Good afternoon. I am Jeff Hirsch, editor-in-chief of the Stock Trader's Almanac and publisher of the Almanac Investor newsletter, and welcome to Wealthwise on Biz Talk Today TV, brought to you by Cross Media. We are live on YouTube and Xpaces. For my latest picks and analysis, go to stocktradersalmanac.com and click on log in in the upper right corner up there, and there'll be a link for a free trial. Today, my friend Michelle "Mish" Schneider joins me. But first, here's a little bit of what's on my radar.
Russell 2000 was looking at an intraday high midday, but didn't make it. It is the closest it's been to the November 24 and November 21. Ironically, those are November's. We can talk about that. We didn't get there though. If it does confirm and go through, that'll be bullish. If not, Mish, talk about a potential double top and other things. But this, you know, movement in the Russell is perfect timing for our new small cap recommendations. We put out a basket to new subscribers last week. So if you want to check those out, go to stocktradersalmanac.com.
The Fed cut a quarter point as expected. That's what we've been looking for. Everybody was looking for it. Seems to be a bit of sell on the news towards the end of the day. Dow gave back about half of the gains, up about 260. Some negative numbers marginally from Dow, from S&P and NASDAQ. As we said, the Russell was higher during the day. Interesting to me, new Fed Governor M — is it Miran, right? That's how you say it. He dissented, the only one looking for half a point. That's what he was expected to do.
Still not surprised for a little bit of potential for a selloff here in September. We've got the end of Q3 weakness with the portfolio restructuring that leads into the October 31st mutual fund deadline that we've talked about. And it's also triple witching September, one of the weakest of them. The Friday, triple witching Friday, expiration Friday in a couple days, is down 12 of the last 13 for the S&P.
The week after triple witching, down 27 of 35 with some nasty hits. And of course, there's the old adage, sell Rosh Hashanah, buy Yom Kippur, which I'll be posting up probably tomorrow with the stats on there. That happens next week with Rosh Hashanah. I guess the first day is Tuesday. Mish is nodding for me there. Yes. So Shana Tova to all of my L'chaim out there.
And also the 2026 Stock Trader's Almanac is here. You may have seen me post on it while we were at Future Proof. 59th edition, same age as me. It's available. I think today is the official Amazon release date. So without further ado, let's bring in my friend Mish. She is a former special education teacher. Very special.
Interesting. I don't think I knew that.
One of the first female floor traders on the New York Commodities Exchange at the World Trade Center. Now she is chief market strategist at Market Gauge, which is a 25-year industry-leading financial publishing company. She's also managing member of Market Gauge Asset Management. You and I have chatted on this. You've got — oh, it's asset managers and RIA. You've got a whole host of other credentials and histories, but thanks for coming on the show. How you been, my friend?
I've been great. And by the way, congratulations on the launch of Stock Trader's Almanac 2026.
I'll have to go get my copy for it.
I can probably arrange that. Maybe I'll see you in Florida.
Are you going to Sarasota?
I'm going to Orlando. Oh, I'm not going to Orlando. I'm going to Sarasota.
Then I'll have to ship you one. But excellent. How's Keith?
He's great. He wanted to say hi, but I'll just have to send his regards for him.
So before we get into the rate cut reaction and your current trades, just tell me how you got into the business a little bit. How did you go from special ed teacher to floor trader and now just, you know, financial expert?
You know, faith is a funny thing, right? I firmly believe in it. But I was a special ed teacher for a long time. I wouldn't say a long time because I was still in my very young 20s, but I thought that was going to be the direction I was going in. However, I wound up meeting a girl who lived in my building who worked on the floor for Merrill Lynch. And so she said, "Hey, you want to come down and see where I work?" And I'm like, "I'd love to." And I didn't know anything about finance. I mean, I grew up in a very modest family, so we didn't exactly talk our stock portfolio at the dinner table. And...
You did, right? Of course, because your dad is famous. My dad was a mailman. Um, famous mailman.
Yeah. Really? So I went down there with her, and I just — like, my brain exploded because I knew this is where I needed to be. And it took a while, but I got a job eventually with Ki Commodities, which was the futures division of Continental Grain. Paul Sarnoff, who wrote the book Silver Bulls back in the day, he's the one who took a chance on me. So I'm forever grateful. May he rest in peace. But anyway, yeah, so I got down to the floor. I'm giving you the very expressive version.
I knew nothing. I relied a lot on the kindness of strangers. The men were unbelievably fantastic in helping me because my job was in coffee, sugar, cocoa to get on the squawk box and tell guys all over the world what was going on and who was buying, who was selling. And so I would like run over to a friend and I'd say, "What's going on?" And then they'd tell me. And then within six months they made me an actual member of the Coffee, Sugar, Cocoa Exchange. So I went from a know-nothing to rookie of the year.
And then I went over to COMEX when Ki Commodities went under because of the Hunt brothers when they tried to corner the silver market. They were...
Right. They were clearing all their trades through Ki Commodities. So they went belly up and so did Kanti. So I came in one day and I was out of a job. So I went over and I worked for a pretty famous gold trader at the time, Charlie Federush. He taught me a lot about the metals. And then eventually I went over to NYMEX, and that's where I spent the bulk of my career, was trading crude oil, natural gas and heating oil.
So I mean, great story. I mean, how did — what — there has to be something that clicked in your head. I know when I started working with my dad, there was a moment where he was explaining something to the group of analysts around the table and everyone was like, "What are you talking about, Hirsch?" And I was like, "I got what you're saying, Dad." Was there a moment or something that triggered where, I mean, you go from special ed teacher to like, you know...
amazing trader?
Yeah, I mean, I think I became a special ed teacher — listen, I love special education, and actually it's kind of circling back into my life in a very unique way, which, you know, is a future project that I'm working on right now that involves the markets and my knowledge of education, special education through full inclusion. So it's not like I have any regrets about the path of my life, but I very much followed the path of my life that my parents wanted me to follow.
So when I went down to the floor, I had been really good in math in school. I love problem solving, and I was also an athlete and super hyperactive. So, you know, all of that fit, and it never fazed me that I was in a sea of men. I never even thought twice about that, really. To me, it was all about the price action and fascination of everything that was going on. So it totally engaged me right from the get-go.
And then I started learning about point and figure charts, and I learned from some of the best chartists in the world. I mean, you got those guys down there were the guys back in the day like Paul Tudor Jones. And when I realized how well charting worked, especially for somebody like me who was physically smaller than, you know, when things were going nuts, to be able to get in the pit and really compete with my voice, the charts actually gave me the clue when I'd see a breakout and I would jump in and then jump out.
So it all kind of fit, and it raised me. I learned everything about the world. I had the pulse on everything that was going on with the Middle East at the time, and, you know, Russia and OPEC, and I mean, you name it, you learn it. Even though it wasn't like we have now, social media at our fingertips.
And I also loved being around all those men. Those men raised me, let's put it that way.
Cool. A bunch of uncles and dads and stuff, right?
So you mentioned charts, you mentioned point and figure, which is an incredible art and science. So you consider yourself a technician. I mean, what's your process? Is it all technical or are you looking at other...
No, I'm very fortunate that I use the technical analysis, and I happen to be really good at it, if I, you know, I do say so myself, not to be...
Yeah. No, no, I am. I took to it really well. Those patterns spoke to me. But I also now, after all this time, and even including on the floor, I've been able to have an intuitive sense of how fundamentals are shifting. So sometimes I'll make a statement even now all the time, people will say to me, you know, "How did you know that? How did you pick that bottom?" Because I get a sense of the things that are shifting both from a fundamental and from a psychological standpoint, obviously, but I don't buy that instrument until I see the actual signal on the chart. So I've kind of combined them both.
I like that. So what are you sensing now? I mean, just going to jump right into it. I mean, what's your Spidey sense telling you?
Well, I'm really keen on the energy space. I mean, we've already been involved obviously with certain aspects of it. I mean, solar has done a lot better than people thought it would.
I've been buying natural gas.
I won't touch crude oil right now. Now, it would have to do something a little bit more significant chart-wise, like get through $68 a barrel in WTI, but I'm already long natural gas once it really looked like it was bottoming. And I was writing about it before it bottomed because let's face it, we need natural gas. And that's what we're hearing now.
The original clean energy, right?
Exactly. The clean energy is great, but you can hear a lot of producers now realizing that we're not quite ready to fuel AI, for example, in data centers without what we have available here in the US. And we've got natural gas.
What's your vehicle for trading natural gas?
Well, I used to trade UNG, but I've learned to hate it. So now...
Because of the contango and...
So now I trade BOIL, which is far more volatile, but actually volatility doesn't bother me as much. So yeah, that's the BOIL ETF.
Yeah, it's a little bit more active. It's a great day trading instrument, my goodness, if you're into that, but I'm not. So I have a position. If it breaks the recent lows, then I would be gone. But it looks like it's bottoming. And that supports the narrative of what I was saying from the fundamental side. So there you go. There's a perfect match.
So what about the overall market? I mean, what's your outlook there? What are you sensing there? We going straight up for the rest of the year? We got a little pullback like I'm looking for maybe. I mean, seasonality for me is becoming a bullish indicator because bearish seasonality didn't happen. So...
Exactly, and that's a — Jeffrey, that's a really good point. You know, we've talked about that here in the office, is that if the seasonality suggests bearish, like with gold, how many gold bears have come out because of the seasonality? And I'm scratching my head going, are you paying attention to all the reasons why gold's going up? So there's your fundamentals, and technically, this massive consolidation that we had that finally broke out of.
So, you know, so it's the same thing with the market. I can't be bearish here, but my natural tendency is to always look for the weak links, right? Because, you know, we climb that wall of worry. That's just the nature of the market. So am I terribly worried at this point? No. I do see potentials.
One of the things that you and I were talking about before we began recording is regional banks, for example, because I remember 2023 in March, we had that flash crash when all of a sudden there was this huge credit debacle. And there are people, some pretty serious people like Ray Dalio, for example, who believes we're going to have some major credit default. Now, I'm not saying he's right or wrong, but what I'm saying is if you look at regional banks, KRE, it hasn't really participated in this rally the way say the S&P 500 has.
And number two is it tested the 50-day moving average yesterday, bounced, but I would keep an eye on that because it collapsed before the rest of the market did in March. And it gave you a great opportunity to get out and wait for the dip to be over. So in that vein, also, we were talking a bit about the Russell 2000 attempt at a new all-time high today.
I mentioned it in my preliminary remarks, and you were thinking maybe we're looking at a double top, and I made the point that we had made the ultimate closing high in November 21, almost touched it — missed it by about 73 cents if memory serves — for November 24. Again, that whole November top thing is very seasonal for small caps for me.
But you're suggesting or thinking maybe if we don't make the new high, we got a double top situation in the small caps. I mean, one, there is a little seasonal push right now around Labor Day for small caps, but that's another story. You're actually even suggesting it could be triple tops if we're looking back at 2021.
And so, you know, I look at the market, obviously tech and growth, that's, you know, been on its own fumes, and that April low was a fantastic opportunity for so many of these stocks. We've seen semiconductors make new all-time highs, SMH, if you're looking at that. And so I always, when I start to see that rubber band stretch where growth is so outpacing the rest of the market, you know, I start to get keen on what could stop the train of the semiconductors or what's going to bring the rest of the market up.
And today was a very pivotal day because a lot of very serious analysts and people who run billions of dollars...
...all said the same thing: a rate cut's going to be great for small and midcaps. Now, small and midcaps have done great to this point in anticipation of rate cuts, and that's been a really great place to be this year is in some of these high-earning small and midcap stocks.
But now that the rate cut happened, and now that we saw more duplicitous talk from Powell today — well, maybe this and maybe that, maybe inflation, maybe bad labor, maybe this was just risk management, maybe we need to do more — you know, it was like, wow, the market doesn't really know. We go to the charts, right?
So if the small caps do not break out of this area that we saw of the high today with any kind of volume, and we see the regional banks turn down, or retail starts to turn down, or transportation, which also hasn't participated, turns down, any of those things, or yields, which started to climb back up, go back up on the face of a rate cut, then I would say I would look to see where would — to me, mean triple or double top. And I think if it breaks down now under, let's say, around 230, that might be an indicator. And I'm just doing this without looking at the chart right now, my memory.
So you mentioned the transports. To me, you know, the relationship between different indexes just invokes the Dow Theory type mentality, where you have a utility, transport confirming industrial, or a small cap. We like to compare NASDAQ, S&P and Dow, you know, sort of that kind of multi-index relationship. Maybe the Russell's like that.
So, you know, I'm pretty bullish. My best case scenario is in play. Concern here for this swirling end of Q3 October period. But the thing about the small caps that everyone's talking about, they're talking about it when the 200 basis points are cut. Small caps outpace large caps by 10%. They're talking about seven times since 1980 where, you know, six of them are up. Seven's not a big statistical set for me. And a bunch of them you have just the small caps going down less.
And a lot of these — I heard somebody mentioning it, a smart person was like on Fast Money or something when I was driving over to the office over here — that those instances were recessionary. And when you do this kind of cutting in a non-recessionary environment, which we're in right now, large caps outperform. So again, I'm with you on the small cap concern. So where else do you see the risks?
Well, you know, one of the biggest risks, and although I keep having the same conversation with people over and over, is that inflation goes out of control. And a lot of people think that we are heading into a hyperinflation environment like the 1970s. But I like to bring it down to what I call the trifecta of inflation. And so far none of my trifecta inflationary indicators are telling me we're going into hyperinflation. Clearly if we do, I think that stops the train of the market. It does. And we know commodities and equities can go up together to a point.
So what are these three indicators?
Okay. Number one would be the gold to silver ratio. And even though it's come way off from the highs with gold outperforming silver, not nearly as much as it was a few months ago, it still hasn't broken down. Where silver — the 80 is about the number that people like to look on the ratio. If silver starts to go under 80 in terms of its performance to gold, that's inflationary.
Where it's 80% of the gold's performance.
Exactly. And, you know, right now with silver at over 42, in and of itself, that looks pretty strong, but it doesn't necessarily mean inflation. Interestingly enough, people would go, "Well, how can silver at $42 not be inflationary?" It doesn't mean that we're not seeing a stagflation potential, but hyperinflation is something else.
Number two indicator would be the dollar. So what's so interesting is even I have been so negative on the dollar. However, I just looked at the chart today because the dollar bounced after the Fed meeting. April and now in August, we made the same low within a few cents, just like we'd made the same high in the Russells, but within a few cents in the dollar. Is this a giant double bottom? I wouldn't rule that out.
If it is, what does that mean for the market? Generally, not great. Although that may not be a factor. Certainly it means that our debt becomes more expensive because, you know, we want the dollar to be weaker in a certain area — till it's a slippery slope — but it also means that this hyperinflation is probably not going to happen.
And then the third thing, interestingly enough, is something I learned on the floor a million years ago, and that was to watch sugar, because sugar is not just a soft commodity, but it also measures a lot of social unrest. It's what people all over the world reach for when they can't afford to eat better or travel or whatever. You know, sugar becomes your sort of cheap vacation.
And even though there's been so much bad press about sugar, it still applies. And sugar has been stronger than it was, let's say, pre-COVID, certainly a lot stronger, but it hasn't really been able to get back over 17 cents a pound. It's back — in fact, it was down again today. So any of those three factors could flip, but right now I'm not so concerned about the hyperinflation.
And this is a long way of saying so: right now I agree with you that the narrative for stocks is probably more bullish than anything else. But you got to pick your places.
Yeah. My place I'm picking for concern is next year, midterm election year, when I think the tariffs will start to impact inflation or potentially could. And then you've got that weak spot of the four-year cycle with the Q2 and Q3, the midterm year, because you've got that ramping up of the campaign mudslinging battles and the focus going away from the economy and market into Washington, where there's going to be a pretty heavy battle for control of Congress with the thin razor-thin margins they have right now. So that's what I'm thinking. We get a little weakness.
Well, that's possible. Actually, I was on Malaysia radio last night, and I always love to hear the questions they ask me because I try not to get into the political arena at all. But one of the questions they asked me was, did I think that politics are going to impact the market? But they were talking specifically about the shutdown that could now potentially happen in the government.
And I — you know, my answer to them, and I would love to hear your thoughts on that, is that we've had this threat for decades, and only that I can remember was in 2011 where we actually shut down, and it was one of the greatest buying...
Huge bottom. Huge bottom. October 3rd. October 3rd, 2011.
Right. Exactly. So do I think it's going to happen? Well, the percentages would be against it, right? I mean, what do you think?
I don't think it's going to happen. And if it does, it's a buy, and it'll set up amazingly right in, you know, the bargain month, the best month to buy stocks, October. So we're right around here. So I think it's clickbait, basically.
One other thing I have to mention, because I'm very keen on watching the consumer, you know, from a fundamental standpoint, it's 70% of the gross domestic product, right? So we know that consumers have to stay in the game and they have to keep buying. We just had the retail sales. It was stronger than expected. It's actually been up for the last three months. Most people would have thought just the opposite.
So we know that the consumer — a lot of it though is the much wealthier people — but we know the consumer is still in there hanging in there, although nuanced. And that would be another thing, especially seasonally as we get now into the holiday shopping season soon enough. Seems to happen earlier and earlier every year. You know, will the consumer stay strong?
And you know, you talked about 2021. If you look at XRT, which is what I like to use for gauging consumer because it's staples and discretionary, that peaked in 2021, and we are nowhere — and I mean nowhere...
