Ivanhoff Capital

MarketSurge powers the charts in this video.

AI stocks are back in under-pressure mode. The market might be discounting tighter regulations if there’s a power change in the Senate and the House after the midterm elections. In addition, OpenAI’s leaked revenue is well below estimates, which has likely led some investors to reconsider their allocations to AI-related stocks for now. The semiconductor ETF, SMH, pulled back to its 20-day EMA around 600. If it is going to bounce, this is a great level. Losing it would likely lead to a test of its 50-day moving average around 580.

If you ignore the elevated volatility in anything AI-related, the situation is not dramatic. SPY and QQQ are consolidating near their all-time highs. Crude oil and rates are pulling back slightly. Small caps (IWM) are trying to stabilize near their 200-day moving average.

Meanwhile, capital rotated into software. IGV is still about flat year-to-date, but it has been making higher lows and consolidating near its 52-week highs. Cybersecurity stocks continue to be the leaders in software – CRWD, OKTA, PANW, NET, CIBR, etc.

Brazil had a huge gap after its elections. Similarly to what happened to Argentina a few years ago when Milei was elected, the financial markets tend to react favorably when a more capital-friendly candidate wins. Brazil’s elections are not over. They have a second tour in a couple of weeks, and if there is a surprise, those gaps will be quickly reversed. So far, the leaders in this space are XP, STNE, NU, PAGS, PBR, etc.

My subscription service includes a Discord room and private X feed with options and stock ideas, emails with concise market commentary, real-time market education, the Momentum 40 list of market leaders, and much more. See what subscribers say about my educational service.

Check out my free weekly email to get an idea of the content I share with members. See how my ideas/alerts performed.

You can find my trading books on Amazon here.

Disclaimer: Everything I share is for educational and informational purposes only, and it should not be considered financial advice. Read my full disclaimer here.

MarketSurge powers the charts in this video.

While so many sectors are at or below their 200-day moving average, the Nasdaq Composite is at new all-time highs. AI stocks continue to lead the market. The semiconductor ETF, SMH, gained 4% last week and is now up75% year-to-date. Software stocks are acting constructively – IGV is only up 2.5% YTD and has been choppy, but keeps making higher lows and consolidating in a range between $110 and its 50-day moving average. People are buying even minor dips in tech stocks for multiple reasons – expected growth, enthusiasm about AI, and mainly because it has been the only sector that is trending upwards. Crypto is also consolidating in a tight range near its 3-month highs. There seems to be a lid on it right now – we saw so many upside morning gaps that consistently faded. 

The jobs number on Friday came below estimates. The Fed has a dual mandate – full employment and under 2% inflation. Higher-than-expected unemployment reduces the odds of more rate hikes. If crude oil also pulls back, yields will decline, which would ultimately help more stocks to join the rally. It hasn’t been pretty outside of tech.

The three big catalysts that are likely to shape the price action over the next month or so are Anthropic’s IPO, the mid-term elections, and the war in the Middle East. And the next earnings season starts in a couple of weeks. 

My subscription service includes a Discord room and private X feed with options and stock ideas, emails with concise market commentary, real-time market education, the Momentum 40 list of market leaders, and much more. See what subscribers say about my educational service.

Check out my free weekly email to get an idea of the content I share with members. See how my ideas/alerts performed.

You can find my trading books on Amazon here.

Disclaimer: Everything I share is for educational and informational purposes only, and it should not be considered financial advice. Read my full disclaimer here.

The main theme last week was the follow-through in AI-related stocks. SMH gained more than 4%. Fiber optics and photonics stocks stole the show as the market is pricing in again the increasing importance of networking equipment for AI agents.

CBRZ +48%, 2x short CBRS. Semis might be leading the market right now, but not all semis are going up. The overhyped AI semiconductor IPO, CBRS, tested its new all-time lows last week.

LITX +31%, 2x long LITE. Photonics stocks outperformed by a mile last week, led by LITE, which is right at its all-time highs. 

COHX +28%, 2x long COHR. Another photonics stock that bounced near its 200dma.

AAOX +28%, 2x long AAOI. Another photonics stock that bounced near its 200dma.

AMAU +23%, 2x long AMAT. Semiconductor stock followed through after testing its 200dma last week.

FNG +22%, 2x long FN

HPEL +20%, 2x long HPE

My subscription service includes a Discord room and private X feed with options and stock ideas, emails with concise market commentary, real-time market education, the Momentum 40 list of market leaders, and much more. See what subscribers say about my educational service.

Check out my free weekly email to get an idea of the content I share with members. See how my ideas/alerts performed.

You can find my trading books on Amazon here.

Disclaimer: Everything I share is for educational and informational purposes only, and it should not be considered financial advice. Read my full disclaimer here.