February 13, 2024

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Trendsters, get ready to transform your portfolio! Today's market rumblings point directly to a seismic shift – maybe the biggest opportunity we'll ever see for explosive wealth creation.

Are those whispers about another tech boom finally turning into shouts? Experts in the know certainly think so. And they're zeroing in on something even more potent than the internet revolution that made countless millionaires. I'm talking AI –  think robots building other robots! Could this be the breakthrough that solves humanity's greatest problems? It's too early to know for sure, but one thing's certain: if you play your cards right, this could be your golden ticket.

And hey, speaking of tickets – Apple seems to have missed its ride to the bull market party. Is the tech giant losing its innovative edge? Our Chart of the Day has the inside scoop on whether it's time to buy, sell, or stash your shares and focus on hotter prospects.

Hold tight, Trendsters, this is shaping up to be a day packed with market-moving news, intriguing insights, and maybe even a sprinkle of financial fun along the way. Let's see what the charts reveal!

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Today's Market Mood: EXTREMELY BULLISH!

The Bear-Bull Meter

The Dow hit another record high today, but broader indices paused their relentless climb as investors nervously await this week's inflation data. With tech stocks looking overheated and earnings season in full swing, the spotlight's shining on the Consumer Price Index (CPI) as a bellwether of future Fed rate decisions.

Here's what shaped today's market:

Profit-Taking After a Hot Streak: After a recent tear, some investors decided to cash in some chips, especially in the tech sector where potential risks seem to be building.

Focus Shifts to Inflation: Upcoming CPI, Retail Sales, and PPI reports could offer critical clues about whether current price pressures are easing or getting sticky.

The 'Overbought' Alarm: Technical indicators point to excessive bullishness, particularly in AI and semiconductor stocks. These stars of the show could fall back to Earth for a brief encore.

Closing Numbers:

S&P 500: Down 4.77 points (0.1%) to 5,021.84

Dow Jones: Up 125.69 points (0.3%) to 38,797.38

Nasdaq: Down 48.12 points (0.3%) to 15,942.55

Beyond the Headliners:  Small-cap stocks showed promising strength today, particularly in retail and banking. Keep an eye on these sectors as potential leaders if momentum shifts.

Strategy Watch: This mixed market may present bargain-hunting opportunities. Consider rebalancing, focusing on undervalued sectors, and perhaps using options strategies to protect your portfolio in case of volatility.

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The Reason Why Will Surprise You.

Remember when everyone panicked about ChatGPT writing their love letters and school essays? Well, investors went full-on Shakespearean drama over the last few days with stocks involved in artificial intelligence.

AI companies surged faster than an overhyped penny stock, reached dizzying heights... and then took a little pause as everyone collectively clutched their pearls, wondering if it was all real or just a machine-generated mirage.

Of course, seasoned investors know a quick pullback after a massive run isn't necessarily a bad sign. Maybe the AI sector just needed a chance to write its own love sonnet or figure out who gets the rose on "The Investor Bachelor".

Now, some trivia to test your stock market smarts: Did you know an ostrich's eye is bigger than its brain?  Think about that the next time you see a stock market frenzy taking over...sometimes investors might need a reminder that long-term strategy beats knee-jerk reactions, regardless of how big and shiny the new trend is.

$APL: Apple Gets Left Behind in the Bull Stampede

Apple seems to have lost its shine in this raging bull market. While the S&P 500 celebrates another record, Apple's stock looks bruised. Is it just some bad press, or a signal that the former tech darling is getting dethroned?

Let's zoom in on the chart:

Hesitation at the Summit: December's price climb looks half-hearted, and January's failed to break further ground. Could a wall of resistance be forming overhead?

The $200 Club Rejection: There's something about that 'round number' psychological barrier...Apple just can't seem to crack it.

Falling Behind the Tech Pack: NVIDIA and Microsoft are riding the bull, but Apple struggles to keep up. This underperformance can spook investors.

Technicals aren't pretty either:

Moving Averages Spell Caution: Both the 50-day and the 8-day EMAs are acting as speed bumps, hinting at short-term bearishness.

$180: Friend or Foe? This support level has held so far. But will it turn into a new battleground?

Keep an eye on Apple – underperformance in a rally is rarely a good sign. It's like a party where the former headliner is looking glum in the corner.

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Let's be honest: we were born into a once-in-a-lifetime opportunity. Artificial intelligence (AI) is about to unleash a wealth explosion that could dwarf even the dot-com era. This isn't hyperbole –  it's an economic reality starting to unfold.

Let's unpack why AI's not just tech buzz, but an economic megaton:

Echoes of the Dot-Com Boom...But Louder: The 90s internet bonanza saw average dot-com stocks soar 35X. But stars like EMC? That's a mind-bending 699X return. Now buckle up, because AI could make those gains look quaint.

Nvidia: Canary in the AI Coal Mine: CEO Jensen Huang gets AI and its future potential like few others. Their recent revenue spike shows even early AI adoption creates staggering impact. This is just the starting line rumble, folks.

Trillions...Not Billions: Goldman Sachs sees AI boosting global GDP by 7%. Management giants McKinsey put the economic injection at $13 trillion (with a 't') by 2030! To grasp the enormity, this AI-fueled wealth wave would swallow more than TWO dot-com crashes without blinking.

And you wonder if your portfolio is AI-ready?

Sector Spotlight: Biotech + AI = Tomorrow's Healthcare Breakthroughs

Today's drug development is absurdly expensive and painfully slow. Enter AI:  it's poised to transform the biotech field. Think  reduced costs, accelerated cures, and an explosion of new therapies. The $50 billion invested in AI drug discovery is proof it's no longer sci-fi – it's a revolution about to take flight. Want a front-row seat? Consider biotech ETFs like XBI, PBE, or PPH to tap this potential tidal wave.

Think Beyond Biology: AI Software Will Reshape the World

Soon billions of connected devices will flood the world with endless data. Who will tame it all? AI software companies will cash in as businesses clamor to turn that data into insights and profits. From industry titans to new disruptors, this is a lucrative space you ignore at your peril.

It's Just the Start...

And that's the mind-blowing part – we're barely scratching the surface here. This week, watch how top experts spot the most explosive AI investment opportunities on the horizon.

Get ready to embrace the AI revolution, friend. The greatest wealth creation event in history has begun, and your ticket just arrived. Ignore it at your own peril.

It's been a mixed bag today, with analyst calls triggering some sharp moves:

Big Lots (BIG) takes a 28% nosedive after Loop Capital downgrade. Is its budget appeal wearing thin?

Hershey (HSY) feels the squeeze. Morgan Stanley cites weak demand and high cocoa costs for its downgrade. Are chocolate lovers cutting back?

Lowe's (LOW) gets a boost as JPMorgan bets on falling mortgage rates reviving the housing market. Good news for DIY-ers?

Rivian (RIVN) stalls further as Barclays downgrades amidst concern the EV boom is hitting a speedbump.

Teva Pharmaceuticals (TEVA) scores a 7.5% surge after Piper Sandler upgrade. Could their portfolio drive improved returns?

Beyond individual stocks, the market's still flirting with all-time highs. This week's jam-packed earnings calendar adds to the buzz, with Coca-Cola, Airbnb, and more joining the lineup. 

Investors are grappling with some big questions:

• How long can the bull run last? Are some stocks getting a little pricey?
• Are falling prices and a cautious Fed enough to justify the optimism?
• Will AI continue to fuel mega-gains in earnings reports?

This week's inflation and consumer data hold clues about the Fed's next move. While rate cuts don't look imminent, any sharp surprises could trigger volatility.  As one expert puts it, a quick pullback wouldn't be shocking, but neither would a continued climb. Keep a close eye on those reports!

Random Musings

Sometimes I wish my portfolio had an AI advisor to filter out the market noise. "Ignore hype, buy undervalued growth stocks"...is that too much to ask, tech overlords?

Ever wonder if financial gurus of the past would scoff at our AI investments, or be secretly jealous? 🤔

The waiting game before earnings reports feels oddly similar to that scene in sci-fi movies where scientists await first contact…intense, with high stakes!

Do markets sometimes feel like a giant experiment in behavioral economics? We're basically the lab rats of investor psychology…

AI-powered investment tools will be amazing...until the first algorithm starts shorting your entire portfolio just for kicks.

On this day in history, February 13

1825: The Erie Canal charter is granted. New York became an economic powerhouse thanks to this feat of engineering, much like AI promises trade disruption today.

1946: ENIAC, the world's first general-purpose computer, is unveiled. Imagine going from room-sized calculators to AI supercomputers in your pocket! Progress has some serious acceleration...

1955: Israel acquires the first of the Dead Sea Scrolls. Who knew ancient texts and machine learning could have something in common –  unlocking insights buried under layers of complexity.

1960: France tests its first nuclear weapon. A landmark reminder that groundbreaking tech always holds a double-edged sword – progress and peril walking hand in hand.

1923:  World-famous archaeologist Howard Carter peers into King Tut's undisturbed tomb. AI might be on the cusp of 'archaeology' within ourselves, decoding genetic mysteries just as profound.

While we often view tech innovation as a future phenomenon, AI is already weaving itself into our industries and investment portfolios.  Like any new gold rush, this one will have its winners, losers, and the occasional tumbleweed moment.

As we stand on the cusp of the AI revolution, remember this wisdom from famed investor Philip Fisher: "The stock market is filled with individuals who know the price of everything, but the value of nothing." In the current whirlwind of hype surrounding AI, this quote rings especially true. 

Don't let the shiny promise of new tech dazzle you - focus on sound fundamentals and identify companies with actual, real-world applications for AI solutions. It may sound less exciting than a quick buck, but remember – boring investing is where long-term wealth is made.

Thank you for reading, and stay tuned for the next issue of Traders on Trend. Until then, happy trading! 

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