Transcription
Today's number, guys, is 10, as we have just witnessed something very rare in markets. Both technology stocks and transportation are going up for 10 consecutive sessions together. Yes, this is not something we see every day, and it brings into question whether we're getting a massive change in market dynamics post the Fed rate cut, as jobs numbers start to look really bad in the US. Could it mean that QE is coming? Well, one thing's for sure, there's a lot of volatility, and it looks like Wall Street is behind all of it. So, join us today in our special weekend edition as we cover stocks, commodities, and cryptos in what you need to know right now about these markets. And boy, oh boy, are there some big moves coming. See you soon.
Well, welcome back, everyone, to the special weekend edition. My name is Thomas Atinson, and in today's video, we'll be covering everything from the macro to the data that you need to know, to what is Wall Street up to, and where have we been seeing a couple of large dark pool trades. But I think we need to kick things off here with the biggest story at the moment, which is obviously the cash burn of OpenAI. After the founder has now gone to code red and said that they need to play catch-up and stay ahead of the game. It looks like the cash burn may be even accelerating. And this is, of course, leading into so many crazy markets, including the RAM prices right now to buy new computers. If you're not familiar, that might have been the best trade of the last 100 days, going up in some cases 250% in terms of market and movement going on. And this is because, of course, it is estimated that potentially these AI companies are gobbling up RAM that could lead into late next year. Yes, it doesn't look like any of this is going to fix anytime soon.
So, why is this so important? Well, of course, to build innovation takes a cash burn. This is nothing new. Uber burnt tons of cash between 2009 and '22. It's just this is on a whole different scale. And I think this chart here from Deutsche Bank really shows you that there is a high-stakes game going on. And remember, the latest MIT survey said that 95% of AI businesses are not going to be profitable. So, there are going to be so many bankruptcies in the future. And of course, it is just a matter of time until some of these can't fund new capital.
Now, why is this important? Well, we're starting to see some pretty big concentration at the top when it comes to markets. We've already talked for a long time about how all the exchange-traded funds coming into the markets, 70% of them are targeting pretty much 10 stocks. But have a look here at the weight of the top 10 positions in median hedge funds' long portfolios. It's now back to those peak pandemic kind of areas where we saw basically 70% plus of the market being overall in just a few stocks. Why is this important? Well, whenever you get to a concentrated market, it means that we're incredibly reliant on them to continue their earning story. And for now, everything has been doing so. But what if Nvidia slows down? What if we see semiconductors start to weaken in 2026? These are the questions that we'll be asking on this channel. So definitely subscribe if you haven't already, and of course, answering throughout the next year, as 2026 is shaping up to be one of the most important years ever recorded when it comes to traders' and investors' journeys. Why? Well, everyone is incredibly concentrated and incredibly stuck in this potential rally here of AI. And you can see, based on the latest Jurian Trummer chart, that this is exactly what happened back in 1998. Yes, we are following the same game plan as the dot-com bubble in many ways, and the market is actually following the exact same pickup that we've been flowing on all year. This is pretty much exactly what we've thought all year, and it brings up to question how much volatility are we about to see in markets. Remember, we have structure coming up later in today's video that realistically shows something very similar: a rally here, a fall-off somewhere next year, and then a real question of whether we're actually about to bubble pop or we're going to continue on. And of course, that will be the biggest deciding point.
So, are AI fears starting to mount? Well, I've often said, only look at the bonds. There's nothing else really to pay attention to, because if the bonds market starts to blink, we need to do a triple blink and potentially start to think about getting out of markets. Well, the 5-year credit default swaps for Oracle have hit 16-year highs, which obviously means that, yes, the bonds market is starting to put like an amber alert on bonds, but in general, you've got to remember the spreads across the board and all corporates are just not really blowing out. So, there's not a fear or a panic in the streets at this point. One thing to note, though, is that we are getting towards investor asset allocations that we usually don't see unless we're about to go into the calm before the storm. So, remember, we are now at low points that we've only seen two other times over the last 30-plus years. And that was just before the dot-com bubble and just before the global financial crisis. And it really just points to the fact that people are underinvested in bonds. So, therefore, most people are just looking for risk. And I would argue if you said to someone right now, "What's a balanced portfolio?" Most of them are going to come in with 80% growth and 20% bonds. Now, balance can go anywhere from 50 to 70 to 80% in terms of growth, and then the rest in bonds and defensives. But it just shows you that most portfolios are going towards all-in whenever possible to get those returns that are required by investors. People want that financial freedom tomorrow, not just in a marathon. It is a sprint right now.
Now let's have a look at the Challenger job cuts data. This one here is really good from Neil over on X and Neil Sethi. And basically, it shows here that there are clearly some job cuts happening in the markets. According to the latest data here from Challenger, it shows that US job cuts are now the highest of any point since November 2022. And if you remember, that was pretty much when we bottomed the market after, of course, going into a 20% plus decline. Now, in terms of which industry is feeling it the hardest, no surprises, it's technology that's feeling it pretty hard, and also the automotive industry. You can see here year-to-date, automotive industry at 29. Obviously, technology though dwarfs everything, 153. Warehousing 92, accelerating big time, and government obviously recently showing up big time in these reports as well. And that was the biggest hirer, you've got to remember, of the last couple of years. So, some interesting data starting to suffer.
But are we again seeing it in the charts? One of the best ways you can kind of look at retail is by using a code such as this in your TradingView or other platforms, which is consumer discretionary versus staples. And what that tells us is whether the market itself is recognizing that the American consumer is weakening. Remember, that's one-third of the economy. So, if we start to see that fall off, then that really shows you that people really have run out of money. What it seems to be happening at the moment, though, is everyone's buying on credit and debt. And remember, people can stay on credit and debt for quite some time until they start to lose their jobs, and then it all comes into play. But at this point, the jobs are only just starting to look like they're weakening. And of course, as we get more data through 2026, that will be the big question.
In terms of daily retail imbalance in single stock ETFs, according again here to Neil Sethi over on X, JP Morgan since November 25th has said that coming into Friday's session, we have seen eight consecutive days of retail net buying, close to or above $2 billion per day, the most over that length since September. So, this means that retail is really buying into the dip. And don't get me wrong, I think it's been an excellent buy so far. So, of course, retail is right in this case, but it does bring up to question whether Wall Street will try to create some kind of flash trap to make money. And we'll look at the options levels a little bit later on today's video to really, I guess, you know, state that.
Now, a lot of you guys know that we've been talking a lot about tightening versus, of course, quantitative easing. And yes, we're in a tight, well, so-called tightening phase. You guys know that I don't believe we've been in one of these realistically. In some ways, yes. But if you look at other sections of the balance sheet, it's actually been pretty liquid, and a lot of liquidity is being provided to the markets. Well, either way, I don't know if we're going to go into a standard QE style form, but do remember, just a week ago, we saw the repo markets being used again. And whenever the repo markets have been used, this is now two times. It reminds us of 2018, 2019, where the market started struggling under the first Trump administration. And what actually had to happen was we needed rate cuts. Sound familiar? And we also needed stimulus in the markets and support. And at the same time, we also got the rise of small caps and the rise of a whole bunch of very speculative style stocks that drove us into, of course, the pre-pandemic period. So, why is this all important? Well, it seems to kind of be happening again. This time around, though, we do see other markets also starting to pick up, which brings into question whether we're getting what we call stagflation. Commodity fund flows are starting to really pick up, and of course, commodities are still very cheap in comparison to gold, silver, platinum. Platinum, the ones that we've liked this year. So, they're looking very exciting on the markets. And we're also seeing the rise of, of course, the rally period, which tends to be better for small caps, which is that December period. So, will we see the same as a normal December? Will we see the Santa rally? This is the one that a lot of people have lost faith in over the years. So, of course, the Santa rally traditionally starts either the 3rd of December or around the middle of the month with the lows around that point, and then we tend to actually rally into the end of the year. Now, traditionally, the real Santa rally is here in terms of the data stat, but you can see why people think it comes early when you have a look at a chart such as this. When you take a look at historical bottoms here from Blue Curlic, you guys can see here that it tends to be either of those periods. But I think the more interesting data here is that this is very normal after a breadth thrust, which, as you would know if you've been watching this channel for a long time, I'm a huge fan of. Why? Because it's one of the best reads in the markets, and it tends to bring the bull, and this time around, it has certainly done so. It also tends to bring the bull for at least 12 months. So, you've got to remember that we're only about 6 to 8 months into this now, and we've still got a lot potentially to go.
So let's now take a look at the number of the day, which is 10, because we have seen 10 consecutive up closes of so many different markets. Now, this is the one which gets interesting. What about the equal-weighted technology market? So, this actually is showing us that when we take consideration of, yes, not just the biggest tech, but we also look at all of the tech across the board, everything's running big time. And this is the first time we've had a run such as this in a very long period. This is a massive streak, 10 days up in a row, and you don't usually see an 11th, but it is, of course, possible. Now, when this has happened in the past, and we only really can use eight consecutive up days, then one week later, two weeks later, three weeks later, actually everything looks okay, but three months later, ooh, not so good. And that's actually going to line up very well with the data stats that we've seen when it comes to moving averages and of course, strength into strength into possible weakness.
Now, another thing that was very rare just occurred here, which is that the event of the Dow Transportation Average (DJT), often called the Dow Transports, had posted 10 days straight gains, close to close, while XLK, so obviously the tech sector, had also done this. Now, this has only occurred one to two other times in the past century, and when it has occurred, generally it's actually brought a little bit of extra strength with it. So, let's take a look here, just firstly at the tech sector. So, what tends to happen when we see the tech sector is that we see one day, two days, three days, very patchy here from Subu Trade, but then a few weeks later, pretty damn good across the board. Two months later, pretty good, and then sometimes things actually get a little bit worse as well. So, it kind of points towards everything we've been talking about: a generalized rally into the end of the year, some type of pullback, maybe not very big, and then of course, everything going with the breadth to kind of push this market through. And it comes back to this really, this 50-day moving average. And we've talked about this several times here on the channel, so I won't go into it too much, but basically, we argued a few weeks ago that we would probably see a little dip. That dip would be purchased, then we would go generally further and higher, but it would be very choppy. And then, of course, we would see a potential reckoning around three months away. And that sounds familiar. Well, it starts to look pretty similar to those charts, especially the '98 narrative that we had before, and everything else.
Now, to make matters even more complicated, we have a couple of dark pools coming in. So, you've got to ask yourself, is this a bit of profit-taking? We already showed you from volume leaders here on our previous video. Well, guess what? We've got a second one now. Now, it is possible these are all buys, and the market will just push higher, but it is also possible it will push down a little lower. And of course, if we lose certain levels, we're going to be looking for certain things, such as 6700, which does have tons of puts on it. Is it a time to be concerned, though? Probably not. Based on the structure we've got currently in the market, I don't think it looks too bad.
Another one that was a bit of a sleeper hit here, and I actually missed it for the last video, and apologies about that, because it actually turned out to be a bit of a beast, was a monster position. The number one ever recorded big double-levered Adobe position. Now, Adobe, if you haven't been following it, has been getting thrashed recently, and I don't think it's looked very good on charts, but it did just take a high as of the Friday close, and you can clearly see here the number one largest trade, and then suddenly the markets go ballistic. So, for people that wonder, does dark pool matter? Yes, it does, especially when it's activated with price. So, maybe Adobe is starting to find its second coming when it comes to the lows and the support. You can check that out in the charts. We will have a look at it on Monday together.
So, from the stock market, which starts to look, you know, pretty good still for the next couple of months, then maybe something shaky. What about Bitcoin? Well, we got the latest data here when it comes to... I don't know why I made this red. Now I look at it, you can't even read it. But when it comes to Friday, and it was bad, guys. There were so many outflows. Yeah, I don't think anyone can see that. But maybe if you've got a super OLED monitor, you'll be able to have a look at it here. But let's just say each one of the major funds was down. And of course, the most important one, IBIT, was down big time. So, probably no surprise that Bitcoin has gone back under 90. We didn't quite get 95,000, which I suspected we would get first, and then we would see a pullback. But does it change our opinions on whether we're bullish or bearish on this position? Well, I think it doesn't really change much, because yes, we expected that Bitcoin would probably rally off here. Yes, it is now closed above the daily 20, which we'll look at later on today's video, and then, of course, it's pulled down. The real problem is, is if it takes out this level. So, obviously, if it takes 84K, that is bad. So, we don't want that to happen if you're bullish, because if that happens, you could be looking at 75K very quickly. But for now, it is still holding that higher low. And remember, it did close above the daily 20, which we'll look at soon.
So, let's jump into the charts. We'll start off here with the big stories, which is, of course, the S&P 500 and the NAS Nvidia position. Go through the options, and then we'll go through the leads and everything else. So, first up, Nvidia. I just want to bring this up quickly because, of course, 185 is the key level. This may be one of the most important, well, it is the most important stock on the markets, and it's holding that weekly 20. So, I just wanted to mention it is holding it. It's not really strong, nor is it weak. But remember, unless it takes out this level of 165, you don't really need to worry about it too much.
Onto the S&P. Was it a good weekly close? Yes, it's the highest weekly close ever recorded. You can't say that's bad. So, this is, of course, usually showing signs of strength. Even if we now weaken, we're probably going to find bulls again. And remember, we did just see mean reversion a few weeks ago, which was exactly what we wanted on the channel and what we'd been looking for over the month of November. Remember, we expected weakness there. Seven months up in a row for the NASDAQ. It's going to have a pull down. It did.
What about the overall futures market action? You can see here we closed above 68.50, but ended up closing at 68.70. It would have been nicer if we managed to get above this to really get positive gamma underway, but the market's dull. I wouldn't short it. Key levels to watch: 6700 into the future, because of course, if we do see a little bit of weakness, that's probably where we're going to go down to. 67 does make the most amount of sense when you chuck some indicators on the charts. Let's have a look now at the overall options movements this week. 69 is now the new level. So, we are, of course, more in that structural gain period. 7,000 seems to be the likely target for the end of the year, because you can see here 7,000 is struck so well in the longer-term options, and it goes all the way up until literally the 31st of December. So, it's a very well-struck level. I don't think any of this is looking like bad structure for the stock market at this stage.
Tesla, very nice. If you ended up buying it, you're back in positive gamma, guys. You'd be very happy. 500 is the clear level for this one, and of course, it could be getting there very, very soon.
Now let's move over to the next positions. We have Nvidia, 185 is the key level to watch, which is, of course, that call wall, and IBIT, which is holding a 485049. So, basically, as we open on the Monday, you kind of expect this to be a very key level. And if we do drop it, watch for 43, guys. Because basically, if you're going to lose 48 on IBIT, then it's probably going to go to 43. And you might say, "Why are we looking at IBIT? Why don't you look at Bitcoin?" Because really, what matters now is what Wall Street is doing with this market, because the options are very profitable. It's one of the most traded options in the entire markets nowadays. So, it is very important what's going on with gold. Gold still looks pretty good. 388 to 390 is a call wall, and it does look like a bunch of puts came in as well. So, this is, of course, going to help to hold up gold. So, nothing bad looking for in gold's terms. When we check out the bonds market again, the spreads are not widening, guys. They are literally tightening. That is not a sign of fear. So, it seems to be all green, all good in terms of the stock market at this stage. I don't see any problems there. And we've used that quite effectively this year to really keep us in.
And the Japanese yen is, of course, continuing to see issues when it comes to yields. You can see here when we're looking at yields, they're all spiking up. But as I've said to you guys, it's a great story. It obviously is terrifying. Well, it's not a great story, it's terrifying, but it's nothing new. So, the question then is, when does it become systemic? When does it actually show up in risk? And until that happens, I always say it's better off just ignoring it and chilling and staying optimistic in the markets. I often say, "If it's in the press, it's in the price." And boy, oh boy, is this story in the press. How do I know it's in the press? Because I've never seen the Japanese yield story get 10 million impressions on X. So, it's getting some significant impressions, and that means everyone's talking about it, which usually means it's not going to crash it today. Remember, a black swan may exist in front of us, but it doesn't tend to be a crash until people forget about the risks involved in it. And don't get me wrong, they're there, but until it cracks, we can't really go too far into it.
What about the story of the rotational switch? Well, this is an interesting one. The Qs junior, which is 100 to 200 stocks, they've actually made a new all-time high. And of course, if we look at the Qs themselves, which have now done, you know, very well as well, you can see here that they haven't made an all-time high. So, they've picked up, but they haven't made an all-time high. So, what that's telling us is that smaller companies are now beating out the big ones. And if that continues, remember post-September, remember I told you that it's actually not a good sign. You might say, "Oh, Tom, it's a broadening pattern." Yeah, it looks okay on breadth. Yes, it gives us initial strength, but if we think about it, it kind of comes back to that Blue Curlic chart which said that yes, this is equal to strength right now having that RSPT kind of doing better here, RSPT equal weight, but at the same time, it often does bring weakness a few months later and also bangs into all of those other moving average kind of stats that we've got going on as well.
Nvidia versus the Spy. You can see no strength in Nvidia anymore, and really all the money has been flowing into other semiconductors, as it turns out that maybe Nvidia don't have the stranglehold on hardware as much as it was initially thought. And funnily enough, this is exactly what happened during the dot-com boom. We saw a broadening of technology companies. Everyone thought that the next person had the next best thing, and then it was kind of like speculation across the board, which led into, "Oh, wait, actually, none of these things have any grounds or or markets." And it reminds me tons of EV companies a few years ago. Remember all those businesses that everyone thought were the next coming, like NIO and Rivian and everything else, and they had massive burns, and yeah, okay, they make stuff, but the profit was never there. And that is the story of the stock markets: know when to hold them, know when to get rid of them.
Dollar index, what's going on here? A little bit weaker, obviously. We may be forming a base support here for the dollar, but too early to tell anything there. Gold had a pretty good week in terms of just holding. It obviously had some rejections here, but I would class this as a pit until proven otherwise. That basically means a pullback in time. And we now have a clear level, 4250, to break out of. If we do that, I think we're going to 4350. Think there could be a good trade here.
All right, let's now take a look at the rest of the markets. US oil, we've still got a 61 barrel kind of on that. Remember, one of our favorite sectors of the last two months, oil services, has absolutely blown it out of the water. Why? Because looking through the sectors has been the best call of the last couple of months, not just semiconductors and tech. There are other things out there. And silver ended up closing pretty strongly. Although it did get an overbought, it was a very strong close. It managed to hold that gap up at 58. And I still think it's worth 75 an ounce ultimately, but obviously how it gets there could be a while. 460 is the initial take-profit target for Tesla for the double bottom buyers. So, congrats for you guys if you were brave enough. Well, well done to you, I guess. This actually wasn't too bad. This one here was bravery. 385 was bravery. Could have been at 330, 340 very quickly. But it does prove that it is an options-based stock with TA. That's the way to trade Tesla. And it's not about narratives. Narratives just end up helping you and get you through.
Now, what about 500? Could it happen? Yes. And it certainly is currently in positive gamma. So, looking a little bit better. I wouldn't say high, high conviction now at the resistance, but price action is still looking fine. Chinese markets still look fine. Again, they still look bullish at this point, and that's on a macro story. And of course, we looked over the NASDAQ before, but generally speaking, the Qs and the miners and stuff, all of these companies seem to be improving. And this is kind of coming through everything at the moment. You'll kind of notice that when you look at things like ARC, which we kind of had a buy level on November 26th, that since done okay. You know, it has been a risk-on environment. We're not quite back to the super risk-on from the October 25th. So, some people think that's the high of the markets in terms of the risk-on, but what I would say is that if you look outside of ARC and you go to the Qs and the J, the juniors, they've got an all-time high. So, again, you don't want to be generally super bearish at all-time highs when they've just been made. You could see them having temporary weakness, but you don't usually want to go against that too much.
Guys, let's have a look now at Bitcoin. So, it hit 93, 94. We thought we might be able to get to 96 first, 95, 96. We weren't able to hit that level. We did close above the daily 20, which I think is still significant. So, we have a look here and we go, significant, significant, significant. We saw huge outflows. Of course, that's delayed. That's happened in price now. And what you guys want, if you're a bull, is just 94K plus. And I don't think 96 is going to stop it anymore, because remember, if this now has already sold off in this supply, the whole thing, supply, then when we come back up, we're probably going to blitz that, and I'm thinking we're going into this area. Let me just tell you, there are a couple of zones in here should we start bouncing up that I've got to chuck on the charts. So, we'll obviously update that should we see a nice rally. But at this stage, I don't think 96 is going to stop it should we take out 94 now, because of the way it's reacted. Now, if you're a bear on this, you just want it under 84. Under 84? Oh, bad. 75K probably incoming. And in the crypto world, this is the most important to watch. Although, I was looking as well at Solana and a few other majors just to show that there were quite a few little bull signals here. This one, Solana, barely trickled my buy signal. Didn't get a good close, which could save you, I guess, but I wouldn't blame people for scaling a small amount there and maybe going like a quarter or a third of a position, waiting for close, obviously now not doing anything, but it did seem to be forming base bottoms, and we had quite a lot of that across many different cryptos.
Into the week ahead, the big story this week is going to be, well, partially for the Australians with the RBA statement on cash rate, whether we're going to get a cut or a hike next. But for the Americans out there and everyone else that actually pays attention to the world of economies, we are looking at the federal funds rate. It's a biggie story. Will we get the cut that everyone now expects, 3.75? We'll have a special about that after the Monday close. And then, of course, we have further information coming out as well. So, the main thing is that we are, we are really in a market where we are at the mercy of what is the Federal Reserve going to do? We're basically in the wall of worry. Yes, we've got some good signs in the economy. We have many bad signs, and it looks like unemployment versus Fed is going to be what it is. So, unemployment, it's on the rise. Now, will the Fed come in and support? I would say yes. How will they do it? Probably a few cuts and also some form of liquidity. So, most people are betting on that. If we don't get it, the market will sour quickly, and it's all about earnings of the top 10, guys. That is 2026 in a nutshell. Top 10 earnings. Top 10 earnings. Top 10 earnings.
If you enjoyed today's video and you enjoyed what we do, please remember to follow us over on the other platforms and subscribe down below. Obviously, check us out on Twitter. Check me out, Thomas Atinson, on LinkedIn. And of course, I hope you have a wonderful weekend with your family and friends. Guys, set alerts in the markets at the moment. The best thing to do is to be patient. Wait for those alerts to be hit. And I've got to say, come from the abundance mindset. This year has been a bonanza when it comes to outside of the tech sector. Yes, tech has done well, but my goodness, have you done well in metals? Metals have been insane for us. And also, we've seen some incredible strength recently in oil services, incredible strength recently in other sectors such as healthcare. Please be aware there's more than one market. And I know it doesn't sound cool when you're talking about a weird pharmaceutical business. No one likes that. But at the same time, if the setup is there and it's repeatable, then why wouldn't you be doing it? Thanks so much, guys.