Ivanhoff Capital

MarketSurge powers the charts in this video.

In the scope of two weeks, the Nasdaq 100 went from breaking below its 50-day moving average on EU tariff threats to making new all-time highs back to dropping near its 50-day. In the meantime, former leaders like HOOD, SHOP, PLTR, APP, RDDT, and many others are getting pressured below their 200-day moving average. Volatility and divergences tend to increase at turning points. 

The one trend that has persisted since last December is strength in semis and weakness in software. The thesis is that AI benefits the former and can harm the latter. This theme accelerated in January. Microsoft’s earnings took the software group down further. The semiconductor ETF, SMH, went more than 20% above its 50-day moving average, so it is normal to see a pullback in the following weeks.

The momentum high flyers that seem to defy gravity finally went parabolic. Silver, gold, memory chip, and space exploration stocks dived from their all-time highs, bringing extra havoc and opportunities:

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MarketSurge powers the charts in this video.

Volatility has picked up significantly lately. It is not the good kind of volatility where you have a range expansion that starts a new uptrend or downtrend. It is the messy kind of volatility where you see frequent reversals and chop – if you don’t take your profits quickly, they disappear. 

Small caps (IWM) began the year extremely strong, reaching 10% YTD by January 22nd. They pulled back 2% on Friday – they were overdue for some type of consolidation. The silver lining is that Russell 2k’s pullback coincided with a rise in Big Tech stocks. Rotations are the essence of durable market uptrends as they keep the excesses in check. 

Silver and gold stocks accelerated their ascent, while the US Dollar is under heavy pressure again. Rare earth metal stocks are off to a strong year – some of them are already on their second upward leg. The next one that is likely to break out is

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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.

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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.

Small caps tend to outperform in the first few weeks of the new year. This is exactly what has happened so far. Russell 2k (IWM) is up 8% year-to-date. The Nasdaq 100 is up 1%. The divergence is significant. We don’t get to see it often. The optimists will say that this is just another sector rotation, and QQQ will likely be the next one to break out as small caps consolidate. This scenario wouldn’t surprise me, but I am also leaning on the cautious side. It doesn’t take a lot of buying power to move small caps when compared to large caps, so seeing pullbacks and fading in the latter is a red flag.

In the meantime, the industries that the government defines as strategically important enough to invest directly in them are clearly leading year-to-date – space, crypto, nuclear, rare earth metals, semiconductors, AI tech, energy infrastructure, and drones. Everything else is choppy and lagging…

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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.