Big tech in a win-win position - Scott Bauer joins Alpha Trader
This week's Alpha Trader features hosts Aaron Task and Stephen Alpher talking equities and gold with Scott Bauer, CEO of Prosper Trading Academy. The S&P 500 (SP500) has been attempting and failing to bust through the June 8 post-crash high of about 3,230. Bauer fully expects the S&P to not just break out above that level, but to soon challenge the all-time high just shy of 3,400 (the podcast was recorded on Friday morning - the S&P did make it through 3,230, closing at 3,251 on Monday). What's holding the market back, says Bauer, are the negative headlines about Covid cases and the related halt or reversal of economic re-openings. Take advantage of the volatility, says Bauer, who offers up an options strategy to do just that. As to which names will lead the market to new highs, Bauer believes it will be the same mega-cap tech stocks that have already led the surge over the past few months. It's win-win, says Bauer, as these plays are in great position to benefit if the economy shuts down again or if economic growth continues. He's not at all a believer in any sort of significant rotation out of the likes of Amazon (AMZN), Google (GOOG), Apple (AAPL), Microsoft (MSFT) into laggard sectors like energy or financials. In his previous appearance on Alpha Trader in November, Bauer made what turned out to be a very prescient call spread recommendation on gold (XAUUSD:CUR), so we were interested in hearing what he has to say today. He's still bullish, noting the presidential election should team with Covid for plenty of headline risk in coming months. Despite gold's troubles during the March market panic, Bauer believes the metal remains a great place to be should markets go into "risk off" mode. As in November, he's continuing to play with upside call spreads.