Ivanhoff Capital

MarketSurge powers the charts in this video.

Last weekend, we observed that the main indexes managed to close above their 20-week moving averages. They followed through and had five consecutive green days. The good mood is back. People are getting excited about a “Santa Claus rally” in December. 

NVDA and PLTR were the undisputed leaders in 2023, 2024, and the first half of 2025. This hasn’t been the case lately. Unlike the Nasdaq 100, both remain firmly below their 50-day moving averages and show notable relative weakness lately. There are new leaders in town – GOOGL and AVGO. The AI data centers component stocks have also recovered relatively quickly and are looking to continue to outperform – some examples include MU, COHR, CRDO, CLS, and VRT.

In the meantime, biotech continues to fly, lifting the small-cap index with it. Small caps outperforming is one of the main risk-on signs. Besides, if a negative reaction to NVDA’s earnings and accusations of creative accounting cannot bring the market down, I don’t know what can, at least for the time being. 

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NVIDIA crushed earnings estimates and raised guidance once again, even while noting that it expects essentially zero sales to China over the next two quarters – a development that anyone familiar with the earnings-estimate game saw coming from a mile away.

What caught most people off guard wasn’t the headline beat, but the violent intraday reversal: a sharp gap higher followed by heavy selling that dragged the entire market lower. Meanwhile, Google (Alphabet) continues trading near all-time highs, up nearly 60% year-to-date. The market has clearly crowned its AI winner – for now.

This feels eerily similar to the DeepMind moment earlier this year, when one breakthrough player’s success was expected to cast a shadow over the rest of the AI ecosystem. The bigger question is whether Google’s aggressive plans to keep doubling its compute and building out massive AI infrastructure will actually require massive ongoing purchases of GPUs and related gear from NVDA, AMD, AVGO, TSM, ANET, MU, and others. In short: don’t be so quick to write off the rest of the AI supply chain. This pullback could very well turn into another attractive buying opportunity in the not-too-distant future.

Despite the recent damage, the broader bull market is not over yet. Both QQQ and SPY successfully tested and held above their rising 20-week moving averages – a level that has served as reliable support multiple times during strong bull runs in the past. This zone remains critical to watch. A decisive break below last week’s lows would put SPY at risk of a deeper 10% correction toward the 600–610 area.

In the meantime, the biotech sector is acting as if the rest of the market’s weakness doesn’t exist. I can’t fully explain the extraordinary relative strength in what is normally one of the riskiest and most volatile parts of the market. If you’re scanning for stocks acting constructively near their multi-month highs, an unusually large number of them are small- to mid-cap biotechs that most investors have never heard of: JAZZ, SNDX, BBNX, TEVA, ADPT, TXG, LQDA, and others.

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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.

When a bull market has been going for a long time and dips have been bought regularly, a trader might become complacent and delude himself into thinking that this will continue forever. At some point, things will change – first quietly and gradually, and then loudly and “all of a sudden”.

The distribution days in tech are increasing. They are happening more frequently. QQQ tested its 50-day moving average three times since September, and every time the bounces have been getting weaker. In the meantime, there has been a rotation into other areas of the market. The hot momentum money has found a new playground – biotech. Even energy is starting to show relative strength. The heavy-volume accumulation days in solar stocks are standing out. I don’t know if those groups are large enough to lead the overall market, but this is where capital has been flowing.

AI-related stocks have been under heavy pressure lately. This is not their first rodeo. Every time the AI-investment thesis has been questioned in the recent past, we saw headlines that have led to a bounce in the field. Last week, AMD’s CEO said she expects 35% annual sales growth for the next three to five years, driven by insatiable demand for AI chips. Nvidia reports earnings on November 19th. What do you think they will say about anticipated growth? Probably something similar. The question is how much of that is already priced in? The market reaction will tell us. If NVDA breaks down, the rest of the market will follow swiftly. The odds are that a pullback to 170-160 will be defended.

Try my subscription service, which 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.