This Is Absolutely Wild…

Today's number, guys, is absolutely insane. $700 billion being spent by Big Tech around the world, and it's all going into AI data centers. With a market that's now ramped so heavily when it comes to semiconductors, what exactly is going on? And can we sustain both tech being up and also energy rearing its ugly head again?

In today's video, we need to talk about the changes that are being made potentially to IPOs throughout this year. What's going on with the Bank of Japan, and of course the intervention of the last 24 hours. And of course, big earnings continues to show some amazing results. Can we trust the future though, and did we just hit the peak? Let's take a look at stocks, commodities, and cryptos together. Doesn't matter which one you like, we've got a lot to discuss. See you soon.

Well, welcome back everyone to the daily show where we talk about everything to do with markets from the macro to what Wall Street's been up to, to of course the key flows that you need to be watching. What a last 24 hours it was, down a little and then rally with mostly breadth throughout the day. But what you might see is a couple of big reds as earnings comes through and some stocks actually don't live up to the hype and expectations. But to start off with, let's start with the macro storylines and of course some of the big changes to IPOs in the future. And maybe more importantly than all of this, what's going on with central bank intervention.

Let's kick things off here with a chart shared from @barchart over on X, which basically showed that national debt is rising now above GDP, the first time since yes, you guessed it, World War II. Now, why is this important? Well, it basically brings us to a point where historically the US has really never actually been. And although we've seen countries like Bank of Japan and others go well above these GDP thresholds, when you've got the biggest currency in the world, and of course the most important country in the world when it comes to economic growth getting to these levels, it always has people concerned about the sovereignty and debt into the future.

Now, why is this all big? Because debt is the aim of the game here in 2026, and it's all got to do with AI and spend. As we know, there are four major IPOs potentially coming this year, and we wrote a piece over at FX Evolution about this, including what's going on here with SpaceX, OpenAI, Anthropic, and Databricks. And the reason we're not talking about this is because it looks like the S&P and actually the Nasdaq might be changing the rules when it comes to bringing these companies into the indices. Now, why is this important? Well, it could provide extreme amounts of liquidity and extreme hype as well into companies that we're still not really too sure how much they actually burn per user and how they're going to make, let's say, profit into the future. So, this is going to be a huge deal coming through, and yeah, I think it's a story that we're going to be following over this year.

To make the stories even wilder, $700 billion. I actually went through the majors here, including Amazon's earnings report, Microsoft's, Google's, Meta, and then of course what Oracle's planning to do. And combined is over $700 billion of expenditure coming into data centers, energy demand, semiconductors, and networking. So, what we've seen so far is obviously anything to do with hardware is going absolutely bonkers. Anything to do with semiconductors is going crazy. And I guess the question is, where is the energy demand going to come from? Is it uranium? Is it other things? Some of these stocks have already been moving for quite some time, and we've obviously looked at some of them. But this is going to be an important factor because generally when you have any major hardware cycle for a new tech, there is going to be a bottleneck. If I had to guess, it's probably going to be something around energy and infrastructure. But hey, what do you guys think in the comments down below? This is a story that of course is currently follow the flow or follow the money, rather than of course, you know, anything else.

Now, we have seen these types of moves before where markets have gone absolutely hyperbolic off proposed growth. But we do need to remember that all of this money is coming ultimately from debt or the the overall residual cash that some of these Mag 7 stocks actually held. Remember when everyone didn't think or wanted them to spend their money? Well, they have done that now, but of course it's led into, as we know, a market now that is run by AI, and that is really adding so much to the GDP. If you actually split the GDP from the last 12 months, you will have noticed that if you take AI out of it, yeah, the growth is not that fantastic.

Let's have a look at the Bank of Japan. They're getting a little bit worrisome about what's going on. It looks like they've got a 160 kind of ceiling now in their currency, and we saw overnight the Ministry of Finance reportedly stepped in to say, yep, we could be making some interventions soon. This led to effectively the dollar index getting crushed and also 160 to 156 support almost instantaneously on the yen. Now, we've seen this before, and on the channel we've often said, ah, it's not that big a deal because they keep doing this. While this is a symptom and inside the problem itself, the thing is it's known, and I think that's important. What has happened in the past though, March '24, July '24, January '25, December '25, is we sometimes see the markets have a little bit of a correction, but that has generally been purchased up. In this case, not many people are talking about it or not that many compared to last time, and that always makes you think, well, have people got complacent towards it? Yes, this is a huge problem. Yes, the Bank of Japan is constantly having to intervene, and there's probably no stopping them. They're going to have to keep doing it until something breaks, but it's not the only issue we have right now. Of course, there are so many going on, but the markets just don't care. It is absolutely all about earnings, and at the moment, the wall of worry is of course being melted up against.

Speaking of which, we've got a market now over the last 5 days. This chart here from Koyfin, go check them out, koyfin.com, basically shows that we have oil services, energy in general, and tech doing the best over the last couple of days, including a little bit of a pick up here in utilities based on I guess the overall energy demand. So, certain companies are doing a little bit better than others, but it has been a two-tone market. We've been looking at energy very clearly over the last week and a half, especially after that number one largest trade. It's done well, but semis has kept pace with it, which is something we just would not have seen a month ago, guys, and it really does change it a little bit here.

When Blue Horseshoe brings out a chart here like this one, I've got to talk about it. This is May seasonality following April. So, give Blue Horseshoe a follow, as you can see over here, over on X. And you can see that basically this is a pretty big one because effectively we have S&P 500 prices above or what they tend to do in May. Now, you often hear this saying in in markets, sell in May and go away. And that came from of course the data stats going back a long period of time ago where May was actually quite weak. Nowadays though, we haven't seen that really. 2022 was the last time we had a sell in May. That was actually a midterm year, which we've already talked about, but the stats have not been strong towards sell in May. What about what tends to happen after April does well though? Goes above 5%. Do we see more sells or do we see a weaker start to May? I guess you could argue we have a mixed result here, but there are a few, you know, weak kind of starts. Uh most of them, if you look at it overall, the average price path, while it can be a little bit weak for the first half of the month or the first 10 trading days, then it usually does lead into stronger. So, I guess based on the structure that we're seeing right now, even if the market dips, it does look like it's usually purchased up based on most other 5% periods. 2026 though is weird, so it is obviously doing different things.

Speaking of weird, well, not so weird, obviously Sandisk. Now, this stock we've looked at a few times. It's had some massive transactions on it, some big dark pool transactions. With if it's the first time here and you're not sure about dark pools, make sure to subscribe, hit that bell icon, guys, because dark pools do tend to really cluster around certain key points. But in this case, what we saw was dark pools came through, weakness on Sandisk, and then it kept climbing after that. And I think what's happened is people can't quite believe uh what this stock is actually achieving. Now, in after hours, they did some big numbers, but still fell. So, the market obviously had priced in some extremely hot numbers. And I'll just give you a couple of stats here. It was estimated that they'd make 4.72 billion, they made almost six. So, that's an incredible beat there. And uh EPS is $23.41 versus $14.51. I mean, just absolutely crazy numbers. And this is just due to the fact that everyone or all the biggest companies in the world are spending astronomical money. $700 billion, guys. This is crazy stuff, and it brings us to this chart, which is of course semiconductor index SOX monthly change.

Now, we've already talked about how history was made recently in the crazy moves of semiconductors up, what was it, 17 days in a row? Well, now we have a monthly percentage change of over 37% in April. Now, that's of course unsustainable long term, but we know what it's catching. It's catching the upgrades from Wall Street, which we'll see in a moment, uh thanks to Juality Research. But you can see here, this has only happened one other time, and it was actually during the hype train that ended the dot-com boom, and we ended up going into a a hugely volatile period, and then it uh distributed, and actually that was near the end. So, you can see here, only one other time, just around that 2000 period, we saw this type of rally. And that's because it is a lot of hype, and you know, the numbers are showing strong stuff, but we also are starting to get a market that's a little bit disconnected. Energy's going up as we mentioned, semiconductors is going up, tech is going up, and that's not really where we were just a month ago. Obviously, until energy breaks through to new highs, generally the market doesn't care, and that's pretty normal. If it's within the kind of normalized range that's been seen, it isn't something like the fear of the unknown, but boy oh boy, is this market you know, definitely doing incredibly well. We can see why based on earnings here on this chart, but boy oh boy, it's it's one of those things that if this is peak earnings, it certainly kind of looks like it based on the spends. The spends and the debt will have to get even more extreme, and at some point Wall Street's going to say, "Where's the money? How are we going to make money from these crazy set spends? Who is also going to be the winner and the loser?" Because remember, in the dot-com boom, we had so many different search engines, and Google was the winner ultimately out of that. Well, this time around, we're dealing with so much more money. Now, usually speaking, IPOs will be the teller, and we know that a lot of those are actually at the end of this year. So, 2026 could still be up, down, and all around, but I'd say at some point, if I was guessing, I would say that at some point there's going to be concern over where does the profit come from for some of these chatbots, and particularly some of the companies that are very deep in debt, such as Oracle, which has already been of course hit the markets.

S&P 500 quarterly EPS estimates, wow. That is crazy. Look at this one here, duality research Bloomberg data. You can see expectations have been blown past 22.4% overall. That's a really, really big earnings result. So, that's why markets are holding against everything. I don't think many people can believe how crazy the numbers are, and that's just literally following off again, the spend into AI, the spend of governments into deglobalization, deregulation in general, and of course defense. So, all of this stuff with the AI data centers is causing this huge gain, which eventually, of course, will come to an end, but maybe it's not yet.

Let's have a look here at energy stocks. We know that of course we got a massive transaction on it. As we know, the markets have continued to climb a little bit higher, and we'll look at that later on today's video, but big stuff going on there. And I just wanted to kind of bring up again that we have been seeing clusters, and although semiconductors haven't sold off those two kind of candles like this, the gap down, they're still sitting in that range. So, as we often say, semi, semi, semi status, anything to do with hardware, they're probably the most important charts to look at over the next coming months.

Let's have a look at US dollar. It went up perfectly to the zone of resistance and got crushed. Almost like the Bank of Japan was waiting for that moment. So, of course, 160 was hit on US dollar yen. Then we saw a huge rebalance, which ended up crushing the dollar index back down. And if we have a look at US dollar yen, which will load up just here, so you guys can see it, you'll notice it went straight back down to around that critical kind of first support with this left-hand side. So, basically, it's recovering a little bit at the moment, but what this is showing us is the Bank of Japan is willing to defend. We're going to see a lot of central bank intervention. They've already been doing it for years. At some point, this is a problem. Is it right now? Well, the market doesn't seem to care, but of course, it will be still a storyline jumping into of course the month of May, which we now find ourselves in.

Let's have a look now at the S&P 500. It's a dull market. That is of course a very dangerous market to short, guys. As we often say, the thing about dull markets is well, there's a saying, which is don't short a dull market, and what you're looking for is of course a breakdown if that's going to happen. And it's interesting to see the daily 20 is now 20 moving average is now moving up to that 705 level, which is that major kind of support on the US 500. Let's have a look here. I don't have the new options high lows today, so I'll get them for the weekend for Monday, but just to show you here, you can see the markets themselves still kind of climbing up after those earnings results, and they made it through 7200, which puts us in positive gamma territory. And if we have a look here at the S&P, you can see why it's all at stake. 7200 is a massive call wall, and this actually opens up of course 7300, which funnily enough is Tom Lee's level. Remember, it's up to 7300, and then possibly issues. Is he actually going to be spot-on here? I mean, yeah, it makes some sense to mid-term election years, and often in the mid-terms, as we've shown before in some of our previous videos, you get that April rally, starts off in May, and actually May was where the averages started to look worse in mid-term years. So, hey, interesting. We'll have to look at price action though. Follow the flows is the key stuff, guys. 7200 shows up quite a lot in the next couple of days in terms of transactions there, and you can see here that we have 670 or 666 plus on the cues giving us positive gamma. So, we're in positive gamma on all the markets post the earnings result from Apple, which was pretty good. SanDisk, which did fall, but all the semiconductors went up. And that's the backbone of this market, so it's made everyone feel great as we pretty much see an economy that's doing this, which effectively is over here we have chip companies, they then invest in the mag companies, then the mag companies invest in hardware, which then invest in chip, and it just keeps going around and around and around and around. >> [laughter] >> So, yeah, we're still in the center pivot at this point.

Nvidia, as you can see, 200, not too bad, even though it did fall 4%, but what is interesting is that Nvidia's been the worst of the semiconductors. So, the rest of the semis doing very well. Nvidia's still technically in an upward trend, but nowhere near the strength of the others. And remember, that is the the poster child of semiconductors. So, if it starts to weaken, then that's suggesting that there's something maybe wrong with OpenAI as well. And OpenAI in particular has a ton of debt, and obviously just did a service round. So, we'll be writing about that in our weekend video in terms of some of our thoughts on this stuff. Now, let's have a look, totally free by the way, pin comment down below.

Let's have a look at Tesla, still sitting around that daily 20 moving average, so no real changes there. And I bit, I thought I'd just show you all the expirations on I bit just to show how many calls are sitting at 4445. You know, the crypto market is pretty run by everything to do with options nowadays, and as you guys can see here, we have some pretty big call walls. When we move over to the majors, again, we look here at 43 on I bit, and it looks like that's where the big put wall is. So, hopefully Bitcoin can do a little bit better. We'll check it out in the charts in a moment.

So, let's bring up the key warning signal. Of course, everyone is now focused in on bonds. Why? Well, we're approaching 5% once again on the 30-year. And this is a bit of an issue because it's suggesting that the cuts can't happen. And if they do, that might be a problem. And it's suggesting as well that we've got a breakout of a multi-year high. But if we actually take it out here 3 months, you'll see it's more than just that. The last time we were even at these levels was was like 20 years ago. So, significant kind of interesting zone here for the for the bonds. We'll be looking at some bond stuff on the weekend and checking that out.

Meanwhile, we also have futures contracts. This is oil futures, guys, something that most retail traders don't look at. That's been in a step a steep up up higher high higher low kind of run here, and what we'll note is that it looks like we're going to have a weekly breakout here on this chart, and you can see also a new high. So, that's suggesting higher for longer for oil, and therefore more pressure on food, more pressure on agribusiness, more pressure on the American consumer in general, which so far seems to be living off maybe credit card debt based on the latest data stats. US oil, you can see here is still pulling up. Did have a bit of a sell-off. A lot of people were wondering how that happened. It was a roll contract, guys. Also, there were probably some other things at play, but still the market is, you know, moving up higher, and I think the weekly close will be pretty important on this. So, we'll be checking that out. But at the moment, 112 is kind of the the barrier that needs to be broken through on US oil.

Energy stocks had a pretty good session up 1% after falling a bit, very similar to what we've been talking about. It's a two-pronged market. We've got tech doing well, and then we've got energy doing well, and oil services as well. And speaking of tech, have a look here at the semiconductors. It hasn't taken a new high yet, but it has managed to kind of stop each short so far. So, even with Nvidia going down, it was still managing to eke out a little bit of gains, and that hasn't stopped though people trying to go into bear ETFs, cuz you can see here, semiconductor bear ETFs, the volumes out of control. So, there's clearly two sides to this market right now. Going to be really careful. Risk management's important. And remember, going against the trend, going against the number one spend item, which is basically AI data centers, that's pretty dangerous, and you've got to always be very, very well aware of your risks involved.

Semiconductors versus spy, it's still completely outperforming here, guys. So, we've got a significant gain still in semis, and the Kospi suffered its first little sell-off in a little while here after we saw Samsung earnings, which were absolutely ballistic. And this will be one I'm still watching. I think data, everything to do with hardware is going to be something we need to check out and watch pretty closely.

Tesla, meanwhile, holding onto the daily. Will we get a gap up? If we have a gap up, then that could suggest a actually well-formed island reversal on the daily. So, something we're watching. Of course, daily 20 in general been a very important point recently. And gold managed to do a little bit of a rebound, changing time frames on small time frames, but not really doing it at, you know, a critical level. So, hmm, I'm not too sure about gold there on the short time frames. I mean, silver did manage to get through the 4-hour 20, which has stopped it each time. So, little bit of improvement here on gold and silver. I think small time frame traders may feel that's, you know, more comfortable with stops under these areas, but again, at the same time, it's it's not really hit what I would think is critical, you know, for gold. I was looking at it the other day and I'm thinking, "Meh." You know, there's not really much holding up gold. Uh you could argue 4,500 super critical, which is what we talked about, but I guess we got very close to it. It's, yeah, we'll see. We'll see. More more structure needs to be formed, I feel like, on that one.

WEM, which is emerging markets, they are continuing to go a little bit higher here, guys. We're also seeing Chinese markets pick back up after kind of flailing around the same point. So, we'll see. Could that be a little head and shoulders towards the negative side soon? Well, hopefully not, but uh at the moment, it's continuing to hold as best it can. And then, of course, we've seen the Nasdaq just crazy, you know, the these things I guess you would say still holding barely on to the 2-hour 50 exponential we've talked about. Slight breakdown here. Uh but it has made higher highs again, which suggests that this is still the level. And for now, it's just continuing to grind higher off what has been a blockbuster earnings week and really history in terms of overall spend expansion spend moving forward and of course, how this market is getting juiced.

When it comes to crypto, Bitcoin and Ethereum, Ethereum not really doing much, just sitting around. Bitcoin also just sitting around. It's not underneath 74K support and it's not above 79 plus. So, stuck in the zone. There's a lot of negative and a lot of bullish people at this area. We have seen in the past some good stats around it, but at this stage, it hasn't broken up or or gone below. So, maybe it'll need a catalyst. Um you know, sometimes those Bank of Japan interventions haven't been so kind to crypto. There's also a lot of people speculating on what's going to happen when Walsh takes over the new Fed chair because new Fed chairs and crypto again have have a bad synergy with them. We'll bring it in in the weekend video.

One thing I thought was really interesting though today in summary is probably the data stat about the acceleration of the semiconductors versus other periods. Now, I have seen even charts that pull back into the 1920s. And supposedly, I think Jason Gotford has one there. And supposedly, that has uh we also saw a similar rally in the 1920s on new tech or innovation and then that acceleration was near the end. The acceleration near the dot-com boom was near the end. And obviously, we've got the same acceleration now. Look, you could say it's justified based on the the overall numbers in the system, but do remember, ultimately, this is going to come from debt. So, the market will say at some point, "Where are the earnings?" Where are the earnings? And if it doesn't present, that's where the problem's going to be. I also think this IPO story has to be investigated further because this is going to provide instant allocation from funds. And that's kind of going to put four big businesses straight into the big tech uh sectors or the big indices. Uh what do you guys think about that? Is that a dangerous move here considering these are all AI businesses or you all for it? Let me know in the comments down below, guys. Make sure to check out newsletter. Follow us on X. Thank you so much for watching. What a week that was. Absolute history made. And we will be back for the weekend with a very good video indeed, I think, covering a whole bunch of stuff. Bye for now.