sport football: The Stock Market in Six Charts (Weekend Edition)

Dear Reader:

I hope you're all having a wonderful Sunday.

Let's review the markets in six charts.

1. Moody's Downgrades U.S. Credit Rating

Well, it finally happened.

Moody's just lowered America's pristine credit rating from Aaa to Aa1 for the first time ever. As I said earlier today, it's a joke… but we'll go with the official narrative…

The reason is that the country is +$36 trillion in debt.

Source: Syz Group, CBO

Politicians who'd rather tweet than govern will do that.

The world's starting to question whether Uncle Sam's debt really is "risk-free." The erosion has begun. Foreign central banks aren't stupid. They're already diversifying into gold, digital assets, and (gulp) Chinese sovereign debt. The dollar's reserve currency status? No longer a birthright. That's why I've laid out this plan for investors.

As Benjamin Franklin so aptly put it, "When you run in debt, you give to another power over your liberty."

America's about to learn that structural privilege has an expiration date.

Prepare for a multipolar reserve system and higher risk premiums.

2. Jim Cramer Called the Market Bottom Again

You can't make this up.

Jim Cramer went weepy in October 2022, saying he got Meta wrong. From that week, Meta stock surged toward all-time highs…

Now, we revisit the early April 2025 "Black Monday" call. It happened precisely when U.S. equities bottomed out, and the market has been ripping ever since.

Source: Barchart, Syz Group

The "Inverse Cramer" indicator strikes again.

Beyond the memes and Twitter dunks lies a fundamental truth…

Sentiment is often your best contrarian signal. So too… is insider buying. That Cramer call aligned with the strongest period of insider buying to selling on dollar amounts in months…

There is a distinct pattern to the markets… and we've laid it out… This is how I warned investors and guided them through the most recent downturn.

Source: Me and the Money Printer

When headline-grabbing TV personalities start screaming apocalypse… It's time to buy with both hands.

The same goes for when corporate executives start buying stocks with their own money.

The lesson?

Noise isn't strategy.

When financial entertainment personalities have emotional breakdowns on live TV, it's your cue to get greedy.

The Cramer Bottom isn't just hilarious… It's profitable.

3. Nasdaq Surges Back Into Overbought Territory

Tech stocks are officially partying like it's 1999 again.

The Nasdaq has surged into overbought territory.

Please pay close attention to the Relative Strength Index. It's screaming "too much, too fast. This could mean we're either due for a pullback or entering the euphoric phase where logic goes to die.

Source: Finviz

But you also must watch… the Money Flow Index. We want to know if BOTH of these are into overbought territory for clues of a possible selloff.

Yes… this is a frothy market…

This froth coincides with Moody's downgrade, persistent inflation, and rising costs to insure against U.S. default.

For traders, it's a classic dilemma: momentum is undeniable, but vertical moves rarely end in gentle fades.

4. Pros Miss Rally While Retail Goes All-In

This makes me feel good.

As markets rose, professional fund managers slashed equity exposure to two-year lows, creating Wall Street's most sadistic pain trade.

Now they face a choice: chase performance at higher prices or risk career problems by sitting out. They're quite under-positioned… at a time

Source: Barchart

Retail traders have gone wild, dumping a record $50 billion into stocks since April. Even more mind-blowing? These Robinhood warriors now control 36% of the entire U.S. equity market—THREE TIMES their historical footprint.

Zero-commission trading and 24/7 financial content have transformed retail flows, creating a bid powerful enough to move large caps and front-run institutions.

The result?

A market climbing a wall of worry, where professional skepticism becomes rocket fuel. History tells us that things get explosive when disbelief transforms into performance anxiety. However, with over a third of the market now controlled by emotionally reactive traders, volatility will amplify brutally in both directions.

Watch fund flows closely—this could morph into a full-blown melt-up before the inevitable bloodbath.

5. Put/Call Ratio Drops to 0.62 — Lowest Since December 2020

The put/call ratio has collapsed to 0.62—the lowest since December 2020, when stimulus checks were funding Robinhood accounts and "stocks only go up" was gospel.

This extreme reading screams complacency.

Source: Barchart, Syz Group

Careful… Investors have abandoned downside protection in favor of leveraged upside exposure. This is concentrated in cultish names like Nvidia and Tesla, where options volumes are absolutely bonkers.

The backdrop—Moody's downgrade, spiking credit default swaps on U.S. debt, and persistent geopolitical dumpster fires—makes this especially insane.

Yet traders are piling into calls with abandon, as if risk management is some outdated concept.

FOMO is reaching pathological levels. Retail inflows are breaking records, institutions are scrambling to catch up, and tech leadership is creating an illusion of safety.

Low put/call ratios don't predict crashes, but they do precede pain. This chart isn't just bullish—it's delusional. Brace for whiplash.

6. Tesla Surges Over 50% in Three Weeks

Tesla just rocketed 50% higher in three weeks…

That'd be impressive for a penny stock, let alone one of the world's most heavily traded large caps.

What's remarkable isn't just the speed but the timing. EV sales are slowing globally, competition from Chinese automakers is brutal, and interest rates remain elevated.

Yet Tesla defied gravity, propelled by AI hype, margin improvements, and a technical breakout that absolutely slaughtered short sellers.

Here's what I continue to argue… VERY GOOD THINGS happen when you trade Tesla above the 20-day moving average… and let it go if it falls under.

Source: Finviz

I talk about this every single day when I'm live… and look for companies like it…

At that level, we tend to see options activity explode.

Gamblers are snatching up OTM calls like lottery tickets.

Musk's vague comments about Tesla's AI and robotics potential provided enough narrative fuel for the faithful.

This is pure reflexivity.

Rising prices strengthen the bull case, fundamentals be damned.

For traders, the lesson is clear: Respect momentum but stay grounded. Parabolic moves rarely end with gentle landings, and Tesla's rally isn't finished until it breaks.

Again, I'll be live tomorrow at 8:45 ET… right here.

As I've noted, I'll be conducting a full week of focus on institutional investing, covering everything from 13Fs to insider activity.

I'll discuss things like…

Why did hedge fund manager Michael Burry sell every stock except Estee Lauder (EL)?

It's $7… and you'll get three trades out of it… plus a full month of live trading (seven hours a day) at TheoTrade. Plus… I'll be live all week at 8:45 for Market Masters…

So, click the link…

Stay positive.

Garrett Baldwin