The Electric Sector That’s Skyrocketing Without You
What a week! We had a big jobs report, a light CPI number, and momentum stocks falling into quicksand. This song seems to fit: So let’s get into this week’s big stories! 1. Utilities Got Hot Consumer Staples was the surprise sexy sector last week. Utilities took the crown this week. Look at that big fat green bar on the weekly chart for the Utilities Select Sector SPDR ETF (XLU): Plus, on Thursday, we noticed a bizarre stat in the options market. As of about 2:30 pm, 231,546 XLU calls had traded. And just 6,129 puts traded. So we had a put-call ratio of 0.026. 38 calls for every 1 put. Crazy. So it looks like some folks were sniffing out a light CPI report. Because a light CPI (which we did get) could mean lower rates which is good for utilities. But there was another big utilities story that didn’t get much attention this week. We all know that AI is driving higher demand for electricity. But did you know that AI giant Anthropic just said it will pay the costs of upgrading electric grids to accommodate AI data centers? That looks like a surprise source of capex funding for utilities. Sounds bullish to me. And on Friday, those call buyers are smiling with XLU on the upswing. FYI – I’m long and strong XLU and VST so my money is where my mouth is. Now let’s talk about the other big sector story this week: 2. The Semis Won’t Stop The VanEck Semiconductor ETF (SMH) had impressed this week thanks to surges in leaders like: Applied Materials (AMAT) Lam Research (LRCX) KLA (KLAC) NXP Semiconductors (NXPI) Cadence Design Systems (CDNS) We saw big earnings from AMAT and Japanese memory maker Kioxia, plus Taiwan Semi (TSM) reported impressive January sales. So even with Kingpin Nvidia (NVDA) stuck in the mud (I do own it), the AI story still has SMH up 13% YTD: I know you’re asking “but isn’t SanDisk (SNDK) really the 800-pound semiconductor gorilla right now?” Well it’s still the #1 stock in the S&P 50p this year. But it’s actually not in the SMH ETF. That said, you might want to hear what JR Romero said about the stock this week: FYI: Get JR’s training here. 3. Software Is Back Under Pressure Traders are still worried about AI nuking software in the wake of Anthropic releasing Claude Cowork. The iShares Expanded Tech-Software Sector ETF (IGV) just hit its highest monthly volume ever. Less than halfway through the month! IGV had a solid bounce attempt into Tuesday but it crapped out fast as leaders like Microsoft (MSFT) and Palantir (PLTR) slumped. We’re even seeing names like ServiceNow (NOW) and Salesforce (CRM) trade at record low valuations. Salesforce is now trading at just 15X forward earnings: This is a tricky situation because it looks like traders are looking for any excuse to sell software stocks. Even though replacing real software (even crappy stuff) with home-grown AI alternatives is far from easy. Every person I know works with software they hate. But even if they could vibe code a replacement, they wouldn’t. Because no one wants to be responsible for the inevitable glitches. 4. There Is Not Much Fear Out There Countless momentum stocks have been rocked, and things feel shaky. But there’s not much fear out there. The AAII Sentiment Survey shows that 38.5% of investors are bullish on stocks for the next 6 months: This is in-line with the long-term 37.5% average. Meanwhile, options-related sentiment indicators like the CBOE Equity Put-Call Ratio and ISE Sentiment Index remain subdued. I like these indicators because trading options with actual dollars says more about sentiment than a survey. And neither shows an explosion in put option demand, which would be a real sign of fear. 5. It’s Been a Bad Year for Small Cap Short Squeezes Since small caps are outperforming this year, we wanted to see if short squeezes were a favor. So we used KoyFin to screen for US stocks between $500 million and $5 billion in market cap, with short interest of 15% or higher. We came up with 138 stocks, of which: 62 are up this year 76 are down The average return is -1.7% So on the whole, it hasn’t been a great year for small cap short squeezes. That said, here are the top 5: Nektar Therapeutics (NKTR): +89.5% Cable One Inc. (CABO): +37.5% Monro Inc. (MNRO): +25.0% Advance Auto Parts Inc. (AAP): +22.2% Twist Bioscience Corporation (TWST): +21.6% P.S. Don’t forget the market is closed Monday for Presidents’ Day! Here’s next week’s calendar:
Continue Reading -->How David Prince Uses Pivot Levels
David Prince uses pivot levels in his trading daily to give himself an edge over just the moving averages. He breaks down the strategy and the importance of trading with emotional intelligence not just by charts: David goes over: When he switches to pivots instead of moving averages How to use pivots to buy a stock that’s trading above the 8-day The big mistake that pure chart traders often make This lesson was part of David’s group coaching that is offered exclusively to members of the Inner Circle VTF®. Apply to join the group now.
Continue Reading -->SanDisk: Wall Street Is Dead Wrong
JR Romero announced his new SanDisk (SNDK) price target. It’s much higher than Wall Street’s $688.16 average. JR goes over: Why today’s news from Micron (MU) is good for SanDisk The unique supply-demand dynamic at play in the memory space Why you don’t need to be a rocket scientist to understand this trade The technical pattern that supports his bull thesis on SanDisk The fundamental problem with Bitcoin The problems in the market that must be resolved before Bitcoin can rally
Continue Reading -->These 2 Ugly, Ugly Stocks Are Buys
ATTN: Sami’s next Mentorship is open! Go here to lock in your spot because they are going fast. Sami Abusaad is bullish on this tricky, sidewise market. And he’s very bullish on 2 beaten down names: PayPal (PYPL) and Zoom (ZM): Sami also goes over: Why the SPY looks better than QQQ right now Why it would be shocking if IWM pulls back in The bull case for his old favorite Ericsson (ERIC) 2 climactic setups you need to see Why he is bullish on Zoom’s (PYPL) monthly chart His entry on PayPal (PYPL) Why he piled into crypto late last week And more!
Continue Reading -->AI vs. Software: Who Wins?
What a week. We got Dow 50,000, Alphabet (GOOGL) and Amazon (AMZN) cranking up their capex, a crypto collapse, and metals trading like meme stocks. So let’s talk about the 5 biggest things you need to know right now: 1. Software Got Nuked By AI Software stocks were the talk of the town this week. In a bad, bad way. Anthropic launched its Claude CoWork app and the world seemed to scream “AI is going to eat software.” The way software was eating the world back in 2011, according to Marc Andreessen. And people started creating doomsday scenarios for AI replacing software applications wholesale. Traders developed a newfound obsession with the iShares Expanded Tech-Software Sector ETF (IGV), which had its highest-volume week ever. Below the surface, it looks even worse. The average individual stock in the IGV ETF is -44% below its 52-week high, according to KoyFin data. Here are some examples: Microsoft Corporation (MSFT): -29% Salesforce Inc. (CRM): -44% WDAY Workday Inc. (WDAY): -44% ServiceNow Inc. (NOW): -53% Unity Software Inc. (U): -54% Oracle Corporation (ORCL): -60% Atlassian Corporation (TEAM): -71% And at the bottom of the barrel is Tom Lee’s Bitmine Immersion Technologies Inc. (BMNR) at 88% from its highs. (more on this below) Here’s another fun fact: just three of the 100+ stocks in IGV have made a 52-week high in 2026. They are Zoom (ZM), A10 Networks (ATEN), and Electronic Arts (EA). And EA in only that category because it’s being taken over. Is the bottom in for software? My personal guess is maybe. IGV hit an RSI of 14.84 on Thursday. Hard to go lower than that: I bought the Global X Cybersecurity ETF (BUG) Thursday because it’s also oversold, and security may be more AI-proof long-term. Ironically, software companies may benefit most from AI. Because AI coding tools like Claude may help developers do more work faster. So in this war… both AI and software may win! 2. Why Hardware Is Winning Now We plotted a simple chart comparing IGV to the VanEck Semiconductor ETF (SMH) and the SPDR® Tech Sector ETF (XLK): This lets us compare the software to the semiconductor sector (a good proxy for hardware) and tech overall. So over the past year, SMH is up 60.8% while IGV fell 22.5%. That’s a differential of 83.3%! You’re asking why, right? To me the answer is simple: shortages are sexy. And short-term gyrations aside, the hottest semiconductor names like Micron (MU), Broadcom (AVGO), Lam Research (LRCX), and Nvidia (NVDA) have been supply constrained. The “we can’t make enough stuff to meet demand” message is catnip for traders. That’s why SanDisk (SNDK) is the #1 stock in the S&P 500 this year. (note: SNDK is not in the SMH ETF) This excitement has pushed tremendous investment dollars to the semiconductor side. Software’s just not been as compelling from a story perspective. 3. Apple Took Over Mag 7, No AI Required I’ve argued that Apple Is Playing the Smartest AI Game of All. Unlike Alphabet (GOOGL), Amazon (AMZN), Meta (META), and Oracle (ORCL), Apple is not blasting hundreds of billions of dollars into new capex spending on AI hardware. Apple’s also not playing financial engineering games with the likes of OpenAI and CoreWeave (CRWV). Apple is simply partnering with Google to enhance Siri with AI. Simple, safe, efficient. Especially since iPhone demand is rampant as it is. And as of Friday morning, Apple was the #1 stock in the Mag 7 this year, by a hair: 4. Consumer Staples Went Parabolic Of all the major index ETFs, the one showing the most power as of late is the Consumer Staples SPDR ETF (XLP). XLP is up 13% YTD vs. a 1% gain for SPY. Its RSI is at 82, which is a record high for XLP (or close to it – my data set isn’t perfect). That’s also the highest RSI of any major ETF. Because stocks like Wal-Mart (WMT), Costco (COST), and earnings winner Pepsi (PEP) have been marching on up. Now, there’s an argument to be made that traders are looking for boring stocks after the wild action in AI, the metals, and cryptocurrencies. But if we look back at the past 10 years, XLP has underperformed SPY by an enormous margin: So there’s an element of catch-up here. Strength in the staples is one reason the Dow Jones Industrial Average just hit 50,000 today. 5. Knives Out for Tom Lee Now, I’m not sure if the crypto market just bottomed. But the hate for Market Strategist and Bitmine Immersion Technologies (BMNR) Chair Tom Lee has been deafening. It feels worse than when everyone threw Ark Invest’s Cathie Wood under the bus in 2022. Tom’s taken a lot of flack for his crazy bullish forecasts on Bitcoin and Ethereum. But I now wonder if Bitmine bottomed at the point of maximum hate: Are you buying? I’m still afraid…
Continue Reading -->I Shorted the #1 Stock in the Market
ATTN: Sami’s next Mentorship is open! Go here to lock in your spot because they are going fast. Sandisk (SNDK) has been the #1 stock in the market. And Sami shorted it this morning at $644.97 because it made a “forever top.” Sami also goes over: The trouble he sees on the SPY and QQQ weekly charts Why the market is in trouble The problems facing gold and silver Why Alphabet (GOOGL) looks good into earnings Why his short ideas are looking better And more!
Continue Reading -->I’m Buying This AI Victim
The SPY remains very bullish, unfazed by the crashes in Gold and Bitcoin, and weakness in select names like Microsoft (MSFT). Meanwhile, QQQ is in breakout failure mode, while IWM is a mess. Add it up, and it’s impossible to pick a near-term direction. But long-term, the trend Sami shows in the video is hard to break: Sami goes over: A software stock he’s buying that was clobbered on AI concerns (6:46 into the video) Why SanDisk (SNDK), Western Digital (WDC), and Seagate (STX) may have topped out Why you must be careful when leaders break down How he makes money without predicting where the whole market is going Multiples names that look ready to break out Why he’s shorting ultra high-flyer Micron (MU) And more!
Continue Reading -->Meet the 4 Horsemen of the AI-pocalypse
What a week! President Trump named a new FOMC chair, the SPX hit 7000, and precious metals turned into meme stocks. So it’s time for the 5 things you need to know right now: 1. SanDisk Leads the 4 Horsemen of the AI-pocalypse Last week, I declared SanDisk (SNDK) “the most dangerous stock in the world… to longs and shorts.” Because it had a parabolic stock price, high short interest, and crazy earnings momentum. The longs won this week when the company delivered blockbuster earnings and guidance, keeping the stock at the top of the S&P 500 leaderboard. Look at the top 4 names year-to-date: SanDisk (SNDK): +172% Seagate (STX) +63% Western Digital (WDC): +60% Micron (MU): +48% *as of Friday morning So the AI trade is dominated by memory and storage stocks. And yes, you know those good old-fashioned spinning hard disk drives? AI data centers can’t get enough of those. The AI game is about SHORTAGES. The bigger the shortage, the bigger the earnings momentum. And right now, 4 horsemen have the best supply-demand dynamics. Because you can’t run data centers without memory or storage. As an illustration, SanDisk guided for Q3 EPS of $12 to $14. That’s triple the $4.33 consensus. And heck, it’s more than Q3 and Q4 earnings estimates COMBINED. But let’s talk about an unlikely AI hero… 2. Apple Is Playing the Smartest AI Game of All Apple’s (AAPL) been criticized for being slow to integrate AI into the iPhone. Which would have everyone switching to Android, right? Which was gonna kill the company, right? WRONG. On Thursday after the close, Apple smashed earnings expectations and reported “staggering” iPhone demand. Now, this chart doesn’t look great: But Apple’s now beaten earnings estimates for 12 straight quarters. The business is 100% intact. As I’ve pointed out 859 times, you can put any AI app on your iPhone. Which gives it all the AI capabilities we need. And the company’s teaming up with Google Gemini to reboot Siri. And if you still believe a lack of AI is a problem for Apple, tell your kids “you’re switching from iPhone to Android because you need better AI.” Their reaction will tell you everything. And consider this. Companies like Nvidia (NVDA), Oracle (ORCL), and Microsoft (MSFT) are hitching their fortunes to the very unprofitable ChatGPT maker OpenAI. OpenAI is burning through billions of dollars and facing intense competition from Alphabet (GOOGL). OpenAI is moving into ads even though Sam Altman once called them a last resort. Because they need money. So when the inevitable AI crash happens, Apple will be watching from the sidelines counting those iPhone bucks, not a care in the world. Full disclosure: Apple is my biggest stock position and I’m 100% biased. 3. Gold Went Full SMCI Gold futures hit a ridiculous RSI of 96.00 on Wednesday. It was like the heyday of Super Micro (SMCI) back in early 2024. And that was right before gold and other precious metals collapsed: By the way, David Prince of our Inner Circle VTF® is going to break down his amazing gold short on next week’s webinar. Sign up for it here. As a general rule, it’s hard for anything to sustain an RSI in the 90s, especially a major ETF. Now we’ll see if dip buyers come in with Gold 11% off the highs, and Silver down 24%. 4. Earnings Season Is Going Great Earnings season started pretty stinky with the banks and a whiff from Netflix (NFLX), to the point where the numbers overall were below expectations. That turned around big time this week with beats from a host of giants: SanDisk (SNDK) Apple (AAPL) Meta (META) ASML (ASML) Boeing (BA) IBM (IBM) GE Vernova (GEV) Lam Research (LRCX) Tesla (TSLA) Caterpillar (CAT) Visa (V) Mastercard (MA) Exxon (XOM) Chevron (CVX) American Express (AXP) Regeneron (REGN) So yes, there’s a lot of things in the world to worry about. But corporate earnings are not one of them. 5. Energy Is the Stealth Hero of 2026 Yes, everyone’s still obsessed with the precious metals and hot AI names. But have you noticed the energy stock boom? SPY is up 1.4% year-to-date. Meanwhile, the VanEck Oil Services ETF (OIH) is up 21.3% and the State Street Energy Select Sector SPDR ETF (XLE) is up 13.1%. Iran is a concern, and we’re seeing headlines that OPEC will keep its oil production pause. Yet it feels like nobody’s talking about the steady rise in crude oil: But we’ll give credit to the T3 Live audience. In our year-end survey, energy was the second favorite sector, behind tech.
Continue Reading -->David Prince Just Nailed Gold
The metals trade got even crazier this week as Gold futures went wild overnight on Wednesday. At one point futures rose $120 per ounce and then fell $100 per ounce in just 20 minutes. That was a $1.5 trillion swing in market cap, causing many to compare the move to how small caps or cryptos trade. Inner Circle’s David Prince breaks down how he navigated the trade and what it means for Gold long term: David also goes over: The state of the market at the end of January Meta Platforms (META) earnings + reaction Why Microsoft’s (MSFT) report killed software stocks Why Immunome (IMNM) is headed for $50+ Expectations for Apple (AAPL) earnings And more! Want David’s insight in your trading daily? Join his free webinar on Monday to see how you can join the Inner Circle VTF®.
Continue Reading -->Nvidia: JR’s Price Target Was Just Released
Sandisk (SNDK) has been the #1 AI name since it IPO’d last year. But Nvidia (NVDA) is back in the driver’s seat. And JR Romero has a big and bold price target which he reveals in his new video: JR goes over: Why Nvidia is going to all-time highs Why he is bullish on Iren (IREN), and where it’s going next A ridiculous space name that has “real momo” A semi name that looks ripe for a huge short His favorite nuclear name that can put in a big rally An AI data center name that’s on his buy list Why swing trading has been tricky And more!
Continue Reading -->