Transcription
With everything going on, we're starting to see a major bifurcation, not only in the names, but also we're starting to see them within the sectors themselves. And I think it's really important for us to spend a couple seconds to go through that.
But before we even get into that, I want to go through the S&P and I want to go through the breath of the market. I waited for it to settle. And I waited for it to settle tonight because I think it's really important. We needed to see what the 5-day was going to do. So when people are new to this is a 200 day, this is a 50-day, this is a 20, and this is a five. These are percentages of stocks that are above those moving averages. For our purposes, we're just going to note a couple things before we go any further.
The very first thing that we're going to note is just where the 200 is. And we just come to here and we can see that line very clearly that you're right above that 50%. And since you've been staying on that line and broke above it, what has transpired? Right? You've just kept ripping. And that's pretty much what happens. As long as you're above the 50, you're in good shape and you have a solid foundation.
Now, if we go to the next thing and we go here and we take a look, what do we see happening? You're starting to get a little bit of a divergence on the 50. It's not great, but it's not the end of the world either. It doesn't mean that I need to do anything about it, but I do want to say take a second and just say that we need to stay above 50. And for right now, if we take a look at this, we are.
Now, I want to go down to the 20 and then I want to go to the five. And this is really where the action is. This is really where the cat's pajamas are, as the kids still say. If you take a look at our level down here, you're 36% down. And that 36% on the 20 marked that bottom. Essentially, you have a divergence right here where we made a lower low. And when we made that lower low, what happened? And I'm just going to mark that off right here so you can see it, right? And then from here, you can see the next one, which is right there. All right. Cool. And then you could see how you made a lower low here, but the breath of the market did not make a lower low. Hence, that's a bottom. And you can do this all the time with the 20. If you take a look here, and you take a look here in that divergence, and then all of a sudden, you can see that March bottom and then go from there. So, mini bottom, mega bottom. But what are they decided by? 20-day moving average. And it does a really good job of that. It's definitely better at telling you trough valuations versus peak. In other words, it's hard to use that with a peak, but you could use the slight to kind of give you a skew, but I'd be really careful with that. But for our purposes, we can see we came down here, hit the 45, bounced back over, now we're over 50, and then if we come to this level, and we take a look, where are we? 45. Where did we come to? We were down here in the 30s, and now we're banging a U-turn. And this is exactly what you want to see. More stocks are getting above that level. And I think that's really important.
Here's the other thing we want to pay attention to. In front of you is the NDX. You can see the drop down on Monday. You can see the gap down on Tuesday, which lasted a whopping what, all of 10 minutes before we came back up and closed at the highs. Sure didn't feel like that today for stocks. And so what we're doing is we're rotating within the sectors. It's pretty crazy. And I I'll show you this, but it's pretty crazy what we're seeing out there, and I do want to get to it, but I think it's really important to get this first.
So, here's the NDX, the NASDAQ 100. We can see the Dogee here, and we can see the lift, and we can see the all-time high close. Doesn't matter if we use this. Doesn't matter if we use the Q's. We can see that. What we're going to do is we're going to take NDFI. We're going to take a look at this. And we're going to see that you had this huge breakout yesterday to 65%. That is stocks above the 50-day moving average on a percentage basis on the NDX. Now, why do you care about this? And I'll tell you why I think you should care about this. I think it's really important to take a note here that you're at 57% and you are strong, right? Yes, the market is strong, but what does this mean? Where am I going with this? And I'm going to show you.
If we take a look at the semiconductors, that is a very clean breakout on the socks today. We have this consolidation pattern. We broke out. We did the little undercut here. The old shake and bake came across and then bam, we broke out. It doesn't feel like that we broke out to a lot of people. And why is that? Let's go through this before we go any further.
Here is Nvidia. It's pronounced Nvidia for those that are asking. And the important part of this is that when we pop over and then we hit that high, we have all these upgrades. And with the stocks hitting new highs, what's happening here? The single greatest stock in that sector is collapsing. Now, you might say, "Well, it's not really collapsing." Well, you have a lower low on the day and the socks is at highs. So, when you start going through this, what they're doing is they're rotating and they're rotating within the sector. So, not only do you have sector rotation, this is really important. Not only do you have sector rotation, but you're now rotating through that sector itself. So, sometimes you're going to see these names rally and then other times you're going to have other names rally. And I'll give you an example. Here's KLAC. Look how that moved today. Take a look at Lamb Research, all-time highs today. How about AAT today? All-time highs today. So, now you're seeing the semiconductor capital equipment manufacturers move up. And I'm going to explain why that's happening.
There is a company in Korea called SK Hynix that you may or may not be familiar with. You are certainly trading in it if you are an active trader. They make DRAM memory. They are a huge company in South Korea just like Samsung. You're familiar with Samsung as well. SK Hynix is actually growing faster. SK Hynix has two X ETFs and those ETFs, those levered ETFs are bigger than Tesla ETFs. Most people are not aware of this. You now are. In that is EWI. Just so we're clear, that is why EWI is moving the way that is. That is why KOU is moving the way that it is. And also, of course, Samsung is in here. So, you have these two companies that are worth trillions and trillions of dollars combined. And this is what they're doing. What does that have to do with the capex that's moving? And this is where it gets interesting.
So, let's go to DRAM. DRAM is a compilation of what? RAM is basically 75% of SK Hynix, Samsung, and Micron. And they're lifting. And here's the thing that you have to understand more than anything about this. SK Hynix, the single biggest company in the ETF space with all the assets under management. And Micron, just so we're clear, has more levered ETF now than Tesla does under assets under management. Just so we're clear, it's no longer Tesla with the levered ETF or levered ETF assets under management and also to TQQ. It is now Micron. It is that is the one that moves it. It is no longer Tesla and this is the first time it's happened and it started this week.
Why do you care about this? Because SK Hynix issued a statement today and in their statement and I'll go through this in the Saturday deep dive. Subscribe, click all notifications. I really want to get to this today. So, I'm trying to get this out as soon as possible because last night's got out late, so it's going to be rolling unedited. Memory came out, this company came out and said, "We are going to double our production over the next 5 years of product." So, just think about that. If everything stayed the same, this is what they're doing. And it's obviously not in US dollars. This is what they're doing. They're going to double that over the next five years. And the statement was even with us doubling it we're still going to be running at a deficit and that's 5 years from now. So ASML you need the machines. SK Hynix offered 15% over sticker. These machines are $400 million. 15% over sticker if you can get them to us within 6 months. That's how bad they need.
So you have trades within trades. So, you have this compute trade that's acting one way and we're seeing that with Nvidia. We're seeing that with ARM today, which I don't know how we're going to complain even though it's flat and it hit a new high today. Very hard to trade for that one today. I think we all felt that way trying to trade it. Long-legged dogeys always make hard intraday trading days.
So, you have this bifurcation going on within the socks. And here's how you can look at that bifurcation. You can start by looking at the ESOC and see that broke out today. You could look at the ASOC. You could see that broke out today. Which one do you think moved more? ESOC moved more. So, when we go through today, before we even get to Marvel when we go through today, we're going to go here and pull this down and we're going to see the ESOX. Now, the ESOC is the equity weighted index. So, when I go through that and I go changes on the day, you're going to see that it's Marvel and you're up after hours. We actually had a great trade in this after hours. I should go through that a little bit.
No, let's go through that really quickly. So, let me just show you something because it was really easy to see and you guys can learn how to do it for yourselves. So, give me one second. I'll just prep it. So, we'll put that here. All right. So, I'm going to show you how to find these targets after hours so that you can do it for yourself. So, what I'm going to show you is that I put this out there and what I was saying it was a five minute bar. This is kind of cloudy. Can't really say it, but you can zoom in on it. There's Dogee here and here. And in between here, there's a dragonfly. And I was saying there's a trade right here over that. And then you can see the dragonfly right here. You know what we'll do? We'll get rid of this. And then we'll go to this. And then you'll be able to zoom in on this and actually see where we're going with this. Right in this area, you're going to see it. Now, what we're doing is we're going to take that low off that. And then you're going to push up into this. So, what you're doing, and then you can kind of see how it falls down in here. So, that's your swing low, and that's your swing high. And we're going to get to this in a minute. It's really hard to see on this, so you're going to have to zoom in, but there's a dragonfly right there. There's another one here, but this one's much bigger, and you can see it. So, what they did was they rallied up, pulled back, tested that the low of that dragonfly, came down again, couldn't do it, and once you closed above the head of the dragonfly, look what happened to the stock. And you could see it left. And so I was just explaining the trade in case it happened so that they would know what to do if they wanted to do it. And then what we're doing is just moving the targets up.
So I'm going to show you how to find these targets for yourself. We're going to go back to a one now. And now you'll see that dragonfly pretty clearly right here. And it's is it perfect? No, Larry. I'm in no mood. And so it's got to get to the top of there. And you can see that the top of that one's actually perfect. But it's not long enough to be a dragonfly. So, and that's a very specific candlestick pattern. That's pretty good. You should be paying attention to them. So, anyway, so we mark off that swing low and then we mark off the swing high. Here's your retest. And then when you break out of that, what you're doing is you're marking these bars and then you're going to put fib extensions. You use fib extensions when you have blue skies. So, when you have blue skies above you, fib extensions are really good areas because they chart human behavior. It's kind of crazy how it works, but I think that they might actually work because we all use them and say that they work, but either way, they work for whatever reason. So, when you can get up to this one, you can see that's exactly where you hit inside bar over, comes back, retests, and then you get to the second one, and then you get to the third one. So, all I'm doing in here is trimming, and then I once it gets up, comes back down, retest, hits the next one, and then I'll just move the stop up to that one. And then when it got up to this one, I thought we had a shot at it because we kept holding that, especially when they flipped support. And then it pushed up into this one. And then I got this bar. I trimmed it. And then I just said, I'm going to use this as the close. And then I closed out of it. But it's a great after hours trade. It looks fantastic. By the way, if you're in this thing, I don't think it's going to collapse. But for me, I spent all day chasing other, you know, I don't know, we'll call them. Don't go chasing waterfalls. Um, and I did was not chasing this one today. and people in the room absolutely slaughtered it with this trade. They've been in this trade for a while. I who knew he was going to do a keynote speech today speech today with him and say that this is the best company that you know in the world. Uh and that's exactly what happened. Jensen did a conference call today at the big meeting in Taiwan and the keynote speaker and Marvel CEO was brought on stage and said this is going to be the next billion dollar or trillion dollar company. They're the cat's pajamas. Yada. Everyone said yay Jensen. And then the stock went up a a lot. I actually thought it would fade on that because I didn't know that he was also doing the keynote to be candid. You know, there's so much going on at that conference. I just was not aware of that. There was so much to know this morning. But nevertheless, this is where you are and this is what's moving and this is exactly what I'm talking about. And this is what I think is happening to a lot of people.
So, I'm going to point this out. You have the Bank of America conference going on as well right now and that is driving a lot of names. You have the bear growth conference that's going on right now that nobody's paying attention to and one of the biggest movers came out of that. I'll show you that in a second. And you want to watch these technology conferences and you want to watch when these speeches are because that it's the fundamentals that set the chart up. We can get into that another video. Let's get to this and get back to it.
So, I'm out here trying to chase ARM off all these different metrics and everything and it's just bonking around. Well, then today's the day that AEHR finally is going to break out. There's no rhyme or reason to what you're saying. They're just slingingshotting you around. It's no different than what you see happening to you in light. Like, oh, all of a sudden, Light's going to break down. This was a perfect short right in here, and then you just get this one part, this one pattern, and that's it. No, we're going to pierce it, and now we're going to hit highs. You need to be really careful of this because it can just as quickly roll back over. But the important part of understanding this, no one's out here saying, "I'm gonna hold this from 800 to a thousand." They're the people that wind up getting carried out in body bags and don't understand why. That's not normal behavior, right? Do you always want to be cognizant of this and aware of it, but when you start to see that the moves do become looking at some of these levered ETFs, they tend to work a little bit better. They keep you in the trade.
If you were looking at the socks today, the socks had a great day. You didn't have to go out there and figure out which one of the 50 names was going to rip today. Is today going to be semi-testing. You didn't have to go out there and figure that out. You just went long so XL and you had a heck of a day and you probably destroyed 99.9% of traders today just doing nothing but going buy at open. Right? So sometimes we get a little ahead of ourselves with things.
I do want to say this part of it as I say that despite what happens here, the demand for memory, it's not going away. It's only getting stronger and we're seeing that. You're seeing that conference in Taipei. Why I think you should be paying attention to these conferences. There's a couple reasons. One, BlackBerry was one that we bought and we started buying it back here. You'll see it at 11 and a half after hours because now everyone on social media is going to tell you how great it is on Twitter. So, what you're going to see here is you see this breakout, right? And that breakout and these breakouts in here. Why? So this was a conference at CIBC and we let the stock set up and then from there we got involved when we started to see it flagging and we've done exceptionally well with the trade and now they're at Baird doing the kind of road tour the road shows people are starting to catch on to this and after they missed Nokia at 67 and now you know went to eight and this is another one we did really well with hardware to hardware right they're all running but this is not a great example of you want to know what's on these cuz when you see them. You can't miss them. And this one absolutely exploded and did very well as well. And you'll see this all over social media tomorrow. And I think it's got some legs to it at this point. You know, I do I think it can really get up there. I think you can get back into some of these levels. And they have a pretty good story to tell right now. So, if you're people are looking for hardware plays that are AI, I pay attention to this.
You had some really weird movements after hours. And I just want to get to this because not only having rotation there, you're going to have rotation in IGV, which you had today. You saw what happened with Google last night and Oracle selling down. Now, Oracle sold down so much. There was so much selling down that it went had an inside bar right after all that. Look what you got. And it's actually setting up for a three bar pattern tomorrow. So, you might want to watch that. Put a little alert there. Ding. And see how that goes because that can 100% lift tomorrow. And that would be that would just be grand. I think the kids still say that. Anyway, where do we want to go with this? We want you to watch the IGV. I want you to watch CIBR. I thought CIBR would go higher. Crowd Strike after hours lifted, came back down. It's still up. PW was great. And then they started speaking and it was one of those things where you wanted to tell the guy to please stop. Please just stop speaking. Now, it was a really good quarter. They raised guidance, but you came right back to that level and you were holding. So, that's actually a really good sign. But we really started to fall apart. And I did a trade after hours on this. I did okay. I didn't do great. And you could just see from the anchored VWAP that we teach what happened. And since it broke that anchored VWAP, you have to know where to put it. I'll save you a lot of time. Put it on the bar when the news comes out there. You're welcome. And you can see where it broke right in here and then from there it just kind of fell apart. Then you see the CEO always explains how they're going to, you know, light the world on fire and be the best. And then the CFO has to explain and they're the second part of the call. The CFO always has to explain how they're going to pay for it. And that's pretty much what happened. But I'd watch this tomorrow. I do think you're going to see follow-through in some of those semi-names. Specifically, I think you're going to see follow-through in the ASML. It doesn't make sense. So, the reason that ASML broke out today to tie this whole thing together, as always, subscribe. As you can see, these videos are all linked together. Click all notifications. I didn't have time for the fancy opening. I went to get this out ASAP. There's a reason why ASML is going up. If SK Hynix is going to increase what they're going to increase by 2x in production, you can't do it without ASML. You need the equipment. And 79% what is it? No, 39% of Lamb Research's NA their revenues come from DRM and ND. So Lamb Research is pretty much the semicap guy, but you can't do anything without ASML. So that's it.