Summing Up The Week

The shortened trading week was looking pretty good for the bulls as stocks shook off tariff fears, Fed minutes which showed no interest rate cuts for now, and a number of other negative catalysts. The S&P 500 just kept popping up by a +0.25% each day, it seemed… until Thursday.

Wal-Mart’s (WMT) warning that their future profits might wane shook the market, casting doubt on the potential for seemingly limitless consumer spending heading forward. Is this the start of a bigger pullback or just a minor speedbump?

Let’s take a look at the news that moved the markets this week…

Market News

Homebuilder sentiment drops to 5-month low

On Tuesday, the Homebuilders Sentiment Index came in at 42 with anything below 50 considering negative and 42 representing a 5-point drop from January’s number, reported CNBC. Homebuilders are sounding the warning alarm regarding the implementation of Trump’s tariffs, particularly since the United States imports much of its lumber from Canada where Trump has promised a 25% tariff in about a month.

“With 32% of appliances and 30% of softwood lumber coming from international trade, uncertainty over the scale and scope of tariffs has builders further concerned about costs,” said NAHB Chief Economist Robert Dietz.

Additionally, while unusual, the mortgage interest rate continues to remain high despite the Federal Reserve’s cutting of the benchmark rate. “Despite Federal Reserve actions to lower short-term interest rates, mortgage interest rates remained elevated in the fourth quarter, which impacted buyer demand as homebuyers continue to face affordability challenges,” said Ryan Marshall, CEO of PulteGroup, in its fourth-quarter earnings release.

Fed worried about tariff impact, rates on hold

On Wednesday, the minutes from the Federal Reserve’s January meeting showed that officials are worried about the potential impact of Trump’s tariffs and most agreed to leave the rates where they are for the time being, reported CNBC.

Most members of the Fed believed the status quo is a good place to pause for reflection as it provides  “time to assess the evolving outlook for economic activity, the labor market, and inflation, with the vast majority pointing to a still-restrictive policy stance. Participants indicated that, provided the economy remained near maximum employment, they would want to see further progress on inflation before making additional adjustments to the target range for the federal funds rate.”

Additionally, the FOMC expressed concerns about “the effects of potential changes in trade and immigration policy as well as strong consumer demand. Business contacts in a number of Districts had indicated that firms would attempt to pass on to consumers higher input costs arising from potential tariffs.” 

Walmart warns profit growth will slow

Most companies don’t move markets when they report earnings, but there are a few key companies who have their fingers on the pulse of the consumer. Wal-Mart (WMT) is one such company, so when Wal-Mart reported earnings on Thursday and warned that its profit growth will slow in the current fiscal year, market participants became concerned that the U.S. consumer is weakening substantially, reported CNBC.

In an interview with CNBC, Chief Financial Officer John David Rainey described consumer spending patterns as “steady” and said “there’s not any sharp changes that we’ve seen.” Yet he acknowledged “there’s far from certainty in the geopolitical landscape.”

Next Week’s Gameplan

Next week is once again filled with juicy economic datapoints that could move markets. On Tuesday, we get the Consumer Confidence Index for February followed by durable-goods orders Thursday.

Finally, on Friday (it’s ALWAYS Friday), we get the Personal Consumption Expenditures (PCE) index for January, the Federal Reserve’s preferred gauge of inflation. We also see retail inventories and existing home sales which could provide some insight into the health of the consumer.

Also, even though it feels like the earnings season has been going forever, we’re not done with the biggies, yet. On Thursday after the close, big mamma-jamma Nvidia (NVDA) reports which will provide a lot of insight into whether or not DeepSeek has killed the artificial intelligence trade.

In addition to Nvidia, my largest holding, there are a lot of other holdings reporting, too:

• Berkshire-Hathaway (BRK.B) always reports over the weekend (which is kinda odd).
• Lemonade (LMND) reports on Tuesday after the bell.
• In addition to the big NVDA, Salesforce (CRM), Snowflake (SNOW), and lowly Virgin Galactic (SPCE) all report on Wednesday after the bell, too.

So, next week promises to be another exciting one so I’ll meet you all back here next Friday, to see what ends up moving the markets this time, friends!

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Crytpo Corner

Bitcoin Price Action

Bitcoin Permabulls are CRAZY!

Don’t get me wrong! I am very bullish on Bitcoin for the long-term. I’ve been in the asset for about 8 years now (nothing compared to my 26+ years in gold and stocks, I know) and I have a very, very long time horizon for my Bitcoin holdings.

However, wow, Bitcoin permabulls are absolutely INSANE!

Early this week, I heard a permabull (this “analyst” has more than 150K followers on X so he’s not small by any measure) talking about how he hasn’t seen sentiment this bad since the FTX collapse. He then said that the bottom was in and he expected Bitcoin to skyrocket from those “oversold levels.”

What? I mean, WHAT?!

At the time, Bitcoin was trading around $96,000 – barely -10% from all-time highs! Even in the world of stocks, a 10% dip from all-time highs is nothing but in Bitcoin and cryptocurrency, that’s not even a dip… that’s just a daily trading range.

Naturally, I disagreed which, of course, pissed off all the bulls who follow him, pointing out that I felt the sentiment right now is actually boredom, not fear or despair. I mean, come on: I got started in Bitcoin in December 2017 right after Bitcoin made its then all-time high around $20K. For the next 18 months, it collapsed nearly -85% not finding support until $3,130!

Even the FTX collapse (which was nowhere near as bad) Bitcoin dropped nearly –75%!

Does this mean I think Bitcoin will collapse? Not necessarily, but I am absolutely not using current sentiment as support that Bitcoin can only go higher. No, as always, my plan remains the same: I will add to my position if Bitcoin drops to lower levels of support and I will trim at points of resistance.

The Bullish Case

I assume my introduction filled you in on most of what you need to know, but the Bulls feel like the sentiment is so bad that Bitcoin has no choice but to head higher from these levels. Some Bulls continue to predict Bitcoin will hit $250,000 before the end of 2025 with some suggesting the price will hit $150K before the end of March.

The Bearish Case

I’m obviously siding with the Bears a bit right now. Sentiment is not bad in the space right now and the Bears argue that if sentiment does get bad, Bitcoin will finally lose the key $89,000 support level and head lower. Some Bears believe that Michael Saylor of Strategy (MSTR) fame has a cost basis around $75K and, should Bitcoin break through that level, it could mean all-out hell for the price as margin calls on Saylor’s stockpile of Bitcoin send Bitcoin careening to another Crypto Winter. Of course, I’m not that bearish right now, but I do believe we could easily see a retest of the $90K area in the coming weeks if there are no positive news catalysts.

Bitcoin Trade Update

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Not Your Keys, Not Your Crypto…

In light of brokerage failures in 2022, I no longer keep any of my crypto on an exchange and I only keep enough USD on the exchanges I use to execute my next few buys. I use multiple cold wallets from the brands Ledger and Trezor to hold my crypto (click the links to access the direct sites, and I receive no affiliate benefits from these links).

Additionally, I have now divided my allocated USD between two different exchanges – Gemini and Coinbase – in case one (or both) becomes insolvent. Disclaimer: We both receive a bonus if you use my Gemini referral link to open an account.

I do not trust anyone in the space, even with Coinbase (COIN) being publicly traded (and one of my own Investments in Play positions).

No price target is unrealistic in the cryptocurrency space – Bullish or Bearish.

While traditional stock market investors and traders may think the price targets in the cryptocurrency space are outlandish due to the incredible spread (possible moves include drops of -90% or more and gains of +1000% or more), Bitcoin has demonstrated that, more than any speculative asset, its price is capable of doing anything.

Here are some of Bitcoin’s price movements over the past couple of years:

• In 2017, Bitcoin rose +2,707% from its January low of $734.64 to make an all-time high of $19,891.99 in December.
• Then, Bitcoin crashed nearly -85% from its high to a December 2018 low of $3128.89.
• In the first half of 2019, Bitcoin rallied +343% to $13,868.44.
• In December, Bitcoin crashed -54% to a low of $6430.00 in December 2019.
• In February 2020, Bitcoin rallied +64% to $10,522.51.
• In March , Bitcoin crashed nearly -63% to a low of $3858.00, mostly in 24 hours.
• Then, Bitcoin rallied +988% to a new all-time high of $41,986.37 in January 2021.
• Later in January 2021, Bitcoin dropped -32% to a low of $28,732.00.
• In February, Bitcoin rallied +103% to a new all-time high of $58,367.00.
• Later in February, Bitcoin dropped -26% to a low of $43,016.00.
• In April , Bitcoin rallied +51% to a new all-time high of $64,896.75.
• In June , Bitcoin crashed -56% to a low of $28,800.00.
• In November, Bitcoin rallied +140% to a new all-time high of $69,000.00.
• In November 2022, Bitcoin crashed -78% to a low of $15,460.00.
• In April 2023, Bitcoin rallied +101% to a high of $31,050.00.
• In June, Bitcoin dropped -20% to a low of $24,750.00
• In July, Bitcoin rallied +29% to a high of $31,862.21.
• In September, Bitcoin dropped -22% to a low of $24,900.00.
• In January 2024, Bitcoin rallied +97% to a high of $49,102.29.
• Later in January, Bitcoin dropped -22% to a low of $38,501.00.
• In March, Bitcoin rallied +92% to a new all-time high of $73,835.57.
• In August, Bitcoin dropped -33% to a low of $49,050.01.
• In January 2025, Bitcoin rallied +150% to a new all-time high of $109,321.90.

Where will Bitcoin go from here? Truly, anything is possible…

What if Bitcoin’s headed to zero?

DISCLAIMER: Anyone considering speculating in the crypto sector should only do so with funds they are prepared to lose completely. All interested individuals should consult a professional financial adviser to see if speculation is right for them. No Get Irked contributor is a financial professional of any kind.