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Hey Trendsters! Get ready, because tech earnings season is upon us, and AI is the star of the show! Big names like Netflix and Microsoft are about to unveil their latest results, and the question everyone's asking is: Can they turn the AI hype into actual profits? Grab tight, because the numbers could make or break some of your favorite stocks. As always, we've got you covered with our 'Chart of the Day' – a deep dive into the SPY's crucial support level. Will it hold? Only time will tell.
And speaking of time, did you know that the first AI research lab opened in 1959? We've come a long way since then! Expect some more fun AI trivia tidbits along with market-moving news throughout the newsletter. Now, let's see what those tech giants have been cooking up... |
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Tackle the Cost of Living Crisis with a Unique Trading Strategy |
Here’s one BIG reason why so many folks feel like they need to target extra income right now. Since the pandemic, the cost of living has gone skyward. It's out of control! In fact, in just the last year alone we saw the average cost of a new mortgage go from $1,427 all the way to $2,047 a month.
That's nearly a $600 increase every single month!
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The bulls are back in town! Markets shrugged off lingering inflation concerns this week, with tech stocks leading the charge. The Nasdaq Composite soared to a record high, fueled by a resurgent semiconductor sector and a better-than-expected PPI report. Mega-cap tech players like Nvidia and Amazon enjoyed sizable gains, signaling renewed investor confidence in the sector.
However, it wasn't all smooth sailing. The Dow Jones Industrial Average saw a slight dip, and financials were mixed ahead of earnings reports from big banks later today. We're keeping a close eye on these reports, which could set the tone for the rest of the earnings season. Here's where the major benchmarks ended:
The S&P 500® index (SPX) advanced 38.42 points (0.7%) to 5,199.06; the Dow Jones Industrial Average® ($DJI) lost 2.43 points to 38,459.08; the Nasdaq Composite gained 271.84 points (1.7%) to 16,442.20. The 10-year Treasury note yield (TNX) rose nearly 2 basis points to 4.578%. The Cboe Volatility Index® (VIX) fell 0.89 to 14.91. The PPI numbers offer a glimmer of hope that inflation could be cooling, though yesterday's CPI report still looms large. This underscores the fact that the path of inflation remains uncertain. While expectations for Fed rate cuts are receding, we still believe cuts are possible later this year - contingent on both inflation and the health of the economy. Strategies to Consider: - Tech Rotation: With the Nasdaq's strong performance, consider rotating some of your portfolio towards tech stocks with solid fundamentals and exposure to long-term growth trends like AI and cloud computing.
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Focus on Earnings: Pay close attention to earnings reports, particularly from the banking sector, for clues about the economy's health and potential market direction.
- Stay Vigilant: The inflation picture remains complex. Keep monitoring key economic data for signs of persistent price pressures, as these could trigger renewed volatility.
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$25,000 into $109,616 in two months? |
Today I want to show you how our research shows you could’ve grown a $25,000 account into $109,616.12 within the last TWO months. You see, former multi-million dollar hedge fund manager Roger Scott spent the better half of 2023 developing what might be the most advanced trading tool that exists… It’s a revolutionary software system that tracks the moves of institutional investors…. in real time… Which means we can now pile into the same exact stocks institutions are buying or selling… as it’s happening. And in the last 2 months, this system has scored an insane 93.5% win rate across 60+ issued trade alerts… Giving over 450 regular traders like you a chance to nail 56 winners out of 60 issued trades.
Now I’m not promising you’ll get the same results… or that you won’t have any losses… But if you want to see how this new trading tool works plus get in on the very next trade…
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Remember when everyone (and their chatbots) thought AI would immediately replace all the stock analysts? Turns out those algorithms need a bit more training. Case in point: last week, an AI-powered investing tool recommended buying shares in a company that went bankrupt...two years ago. Who knew algorithms could be nostalgic?
On the bright side, at least it wasn't an April Fool's prank – those tend to backfire on investors. The takeaway? AI is a powerful tool, but it's no substitute for good old-fashioned human judgment (and a quick Google search, for that matter).
Fun Fact: Speaking of judgment, did you know the "January Effect" is a real thing? Historically, small-cap stocks tend to outperform in January. Maybe all those New Year's resolutions to be bold investors have something to do with it? |
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The SPY's Support Line on Trial |
The SPY's in a precarious position, folks. It's broken free from its recent channel, and the 1D MA50 stands as its last line of defense. Will it hold, or is a bearish breakdown on the horizon?
History might have a hint – past breaches of the MA50 resulted in some nasty drops. And with the CCI flirting with oversold territory, things could get interesting. If the MA50 fails: - Prepare for a potential dip towards the 1D MA100.
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Smart investors might see this as a long-term buying opportunity (around the 495 mark, if history plays out).
Our end-of-May target remains bullish at 524.50, but the ride could get bumpy.
The bottom line: This chart isn't for the faint of heart. Keep a close watch on the MA50, and be ready to shift your strategy if support gives way. |
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A Silicon Valley Insider and former #1 stock picker in America just released this SHOCKING footage from outside the Tesla Gigafactory, in Austin, Texas. |
And it reveals Elon Musk's “A.I. 2.0.” If you’ve been seeing all the news about A.I. but haven’t heard of A.I. 2.0 yet… It’s not your fault. Wall Street and Silicon Valley are hiding this from you and taking all the profits for themselves. But every American citizen deserves to see what Elon is doing… Because Musk himself confirmed that this new project will outgrow Tesla when he said “[A.I. 2.0] has the potential to be more significant than the vehicle business”
Click here now for all the details.
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AI's Earnings Spotlight – Time to Deliver
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The AI earnings train is pulling into the station, and the question on everyone's mind is simple: Can software companies turn the AI hype into real, cold-hard profits? After a year of chipmakers and cloud providers raking in the cash, the focus shifts to the companies actually putting AI to work. Investors have been feverishly buying up software stocks, betting on an AI-fueled growth explosion. Now, it's time to put up or shut up.
Analysts like Wedbush's Dan Ives are bullish, predicting a major AI-driven tech rally. The numbers seem to back him up, with AI spending set to surge this year. But remember, promises and profits aren't the same thing.
Earnings season will be a reality check. Netflix kicks things off, with investor focus squarely on subscriber growth and its ad-supported tier. Microsoft will be closely watched for updates on its AI Copilot software and Azure cloud growth. And don't forget about Amazon, where AI is expected to power a rebound in its cloud business.
But not everyone is riding the AI wave equally. Apple seems stuck in the mud, while Meta's gains could be threatened by soaring AI development costs. Google sits on the edge too – will its search dominance be challenged by chatbots?
The answers are coming soon. This earnings season, it's not just about the hype. It's about proving AI can deliver the profits that investors are so eagerly anticipating. |
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Here's a quick rundown of the stocks making waves and the economic data guiding investor sentiment:
Earnings Reactions: CarMax skids on disappointing results, while Constellation Brands gets a boost from beating expectations. DoorDash sees a brighter future thanks to an analyst upgrade, but Fastenal takes a hit from lower earnings. Nike gets a running start after an analyst sees Olympic-sized potential.
AI Power Play: Nvidia keeps climbing as bullish sentiment around AI and their new Blackwell GPU fuel optimism. Big Banks on Deck: Earnings season heats up for the financial sector. Will they break the underperformance trend, or will fading rate cut hopes weigh them down? Inflation Tango: The PPI report offers a glimmer of hope, suggesting the PCE index (the Fed's favorite) might ease investor worries. But don't get too comfortable – strong jobless claims data shows the labor market remains stubbornly hot.
Key Takeaway: It's a mixed bag as earnings, shifting analyst views, and the ongoing battle with inflation all set the stage for market moves. Keep a sharp eye on those bank earnings – they'll be a crucial indicator for the road ahead. |
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MARKET MUSINGS & TIME CAPSULE |
Random Musings: Financial Fortunes and Follies AI and ethics: As AI systems become more powerful, who decides how they're used? Will it be the tech giants, governments, or a new breed of "AI ethicists"? A fascinating (and slightly troubling) question for our time.
The Turing Test turns 74: Today marks the anniversary of Alan Turing's famous paper on machine intelligence. Have we passed the test yet? Some chatbots argue they have, but human skepticism remains high.
Memory is fallible: Earnings reports are like history lessons – often revised and reinterpreted with hindsight. Just as we shouldn't take every historical account at face value, a strong quarter doesn't guarantee smooth sailing forever.
Efficiency isn't everything: Remember Meta? Their "Year of Efficiency" boosted the stock, but can they sustain growth while cutting back on long-term AI innovation? Sometimes, spending money IS the smartest move.
It's all speculation: Analysts make predictions, but the market is a fickle beast. Those 15% growth forecasts? Treat them like an intriguing novel, not a scientific fact. On this day in history, April 12
1912: The RMS Titanic sinks. A reminder of technological hubris and the unpredictability of markets (and icebergs). 1961: Yuri Gagarin becomes the first human in space. A groundbreaking achievement for AI? Perhaps the first step in machines eventually leaving us humans in the dust. 1983: Microsoft unveils the first commercial computer mouse. Now considered essential, it was once a clunky novelty. Will today's groundbreaking AI innovations seem similarly antiquated in the future?
1994: Amazon, then an online bookstore, sells its first item. AI may be their key to world domination today, but it all started with a humble book order.
2018: Elon Musk announces Neuralink, a venture focused on brain-machine interface development. The stuff of sci-fi novels is becoming reality... which could be either very good, or very scary for investors. |
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"The best way to predict the future is to invent it." - Alan Kay
And boy, are we inventing! AI is here, and it's shaking up the markets. We've seen chipmakers surge, cloud providers soar, and software giants scrambling to catch up. But as earnings season reveals, it's time to separate the hype from the true bottom line.
Some stocks will take flight, powered by genuine AI innovation. Others might prove to be mere Icarus figures – flying high on investor enthusiasm, only to melt as the reality of profits sets in. So, as we dive into the AI earnings whirlpool, remember – innovation is a journey, not a magic bullet. But keep your eyes open – it's going to be one bumpy flight! |
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