Tech AI Titans Go Thermonuclear
The OG tech monsters went full Chernobyl mode today in a shocking intraday meltup that should have the Fed's AI models sweating.
After getting vaporized in the morning by a scorching hot inflation print, the high-flying AI/tech trade flipped a completely unnecessary amount of violence. The Nasdaq Composite went supercritical, erupting 2.17% higher to 17,395. The S&P 500 had a nice little chain reaction too, spiking 1.07%.
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The Chips Were Absolute Meltdown Material
Leading the radiated hellscape was the white-hot semi space. Nvidia had a straight-up nuclear reaction, blasting 8% higher after CEO Jensen Huang gave the AI hype reactors a fresh supply of enriched hopium at a Goldman conference. Chip stocks across the board were in full "Ouchers" mode, with the SMH semi ETF vaporizing shorts to the horrifying tune of 5%.
The blistering rally came as traders doubled down on their Fed bet - now pricing an 85% chance of just a 25 basis point "kitten hiccup" next week. They're tuning out the radioactive core CPI read and focusing squarely on decaying inflation levels quickly approaching that cold shutdown we all crave.
Melt-Up Narrative Is Now Cooler Than a Supercomputer
With the market now essentially presuming the Fed's final high-energy rate blast is imminent, chatter of an epic uncontrolled melt-up across the beaten-down tech/AI space is hitting crit mass.
The Nasdaq is still a whopping 15% below its mid-2021 record highs when it experienced its last insane gamma burst. It's trading at just 26x forward earnings - an absolute bargain considering its decade-plus median valuation around 30x. If the Fed signals it's SCRAM-ing out of hike mode, those compressed multiples could get straight-up Fukushima'd higher in a frenzy of AI/momentum algos going full singularity.
All Calculations Hinge on Clearing 17,800
We may have gotten just a tiny whiff of those fission particles today, with titans like Apple, Microsoft and Amazon all erupting over 2% off their lows. If the Fed triggers a "one-and-done" pivot, AI quantum rebels could seize control of the reactor and blast the Nasdaq to new heights before you can say "Grey Goo."
The first major upside level to watch is 17,800 - the Nasdaq's 200-day moving average that's been white-hot resistance. A clean breach there could open a chain reaction across institutional AI funds as they engage in full "buy-everything" protocol.
Of course, if the Fed hits the rug with another semi-unexpected hawkish fuel rod, it's an instant meltdown back to whipsaw chop city. But for today, at least, the tech behemoths were raging hotter than the core of Reaktor4 - putting central bank crisis strategists on literal meltdown notice.
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