I/O Fund Portfolio and Game Plan
Going into this year, we advocated for a defensive posture due to various risks in the broad market, as well as within valuations. We outlined these risks each week on our webinars going back as far as October of 2024. As a result, we maintained a very high cash allocation and quickly jumped into our hedge at the first sign of support breaking in January and February.
As a result, we remained largely unscathed in the April drop and deployed nearly all our cash into the lows. In fact, we issued 22 buy alerts between March 3rd and April 7, with 12 of those buy alerts happening between April 4th – 7th. We do not know many out there that were buying these lows as aggressively as we were.
Since the April lows, we have maintained our game plan – reposition defensively into the bounce and let the market tell us what the next move will be. While we did not expect this bounce to go this high, and began positioning defensively too early, we are still adhering to the same gameplan – if the next pullback is a messy/3-wave drop, we will position aggressively for the next trend higher. If instead we see an aggressive/5-wave drop, we will patiently wait for lower levels to position.
This game plan is best expressed by the two counts presented in the chart below:
- Green – We are completing the first leg in a large degree 5th wave. The 2nd leg should take the shape of a 3-wave decline that first breaks below 6200 and then 6105. It will then find support on 5900 – 5500 and must hold 5345. We will then turn higher in a more aggressive 5-wave uptrend to new all-time highs.
- Red – The final 5th wave completed in February of 2025. The bounce off the April low is a large corrective rally within a larger uptrend. The next drop will be an aggressive/5-wave drop that ultimately breaks through 5345.
Note how the current rally is pushing higher with a strong deceleration in momentum and volume. This is a common occurrence when we are close to a trend change. Furthermore, the RSI is still hovering below bear market resistance for the S&P 500, signaling that a return to the level of momentum that we tend to see in strong and lasting bull trends is not yet present.
One additional point is noting how many key markets are currently not participating in the S&P 500’s recent rally to new highs. Key markets that have either led the bull market or are more sensitive to the economy did not confirm the S&P 500’s push to new highs last week.
While divergences can correct, and the trend continue, nearly every turning point – tops and bottoms – shows divergences like the ones shown above. It implies that the higher we go, the less key markets are participating.
While the odds are quite high that we should see some type of reversal soon, we still favor the green count based on the strength of the A.I. market, which appears to be ramping, as expected. The stock market is one of the greatest predictors and leading indicators. For this reason, we will remain open, and risk focused, as we wait for the market to signal the “all-clear.”
Current I/O Fund Portfolio
Our current portfolio is back into a defensive posture. Our game plan is to rebalance our portfolio for the second half of 2025. We are first raising cash around the highs and will issue our buys on the next drop.
As of now, we are heavily tilted toward A.I. hardware, which we plan to maintain. However, we intend to increase our exposure to A.I. software, as well as energy in the coming rebalance.
Regarding crypto, the easy gains are over. We are on the lookout for the top to the current bull cycle in the coming weeks or positioning for one more high into the $200,000 region. Our exposure to crypto will depend on how the next drawdown shapes up. We go into much greater detail in the individual positions below.
Astera Labs (ALAB)
ALAB has been the stock with the most bullish potential since we began investing in it in 2024. This lines up with the fundamental outlook as we discussed in The I/O Fund’s Top 15 Stocks for Q3 2025, which is why it is such a large position. There are two general interpretations of the price data that we are tracking:
- Green – The 2024 uptrend off the low is a large 5-wave pattern. This was followed by a deep 3-wave retrace that made a higher low. We now completed another 5-wave uptrend off the 2025 low, followed by a sideways consolidation for wave 2.
We called out the importance of the $100 – $85 region, as many institutions were active in this region. The breakout move suggests this was accumulation. So, the next drop needs to be 3-waves down, and hold above the $85–$100 region to suggest an imminent breakout.
- Blue – The recent push higher was a 5th wave – aka, bull trap. The coming pullback will break through $85, finding support in the $60s–$70s. We must hold $59 if we see this deeper pullback. This will end wave 2, as we set up for the larger 3rd wave breakout.
Bitcoin (BTCUSD)
The weekly chart on Bitcoin has us definitively in the final 5th wave of the bull cycle that started in 2022. Note that price went vertical in 2024 on max volume and momentum. This is the 3rd wave, which is almost always the most exciting part of a trend.
The primary question is when did the 3rd wave end? If it was in mid-2024, which is represented by the red count, then we should see a final push into the $125,000 – $135,000 region. If the 3rd wave ended in late 2024, which is represented by the green count, then we can see the 5th wave take us well over $200,000 before ending.
The internals on the weekly chart of Bitcoin are also at a key inflection point. Note that the RSI and the Detrend Oscillator are at the same levels that have marked meaningful reversals in Bitcoin’s trend. This is also happening on decelerating volume. In other words, the higher price goes, the less interest we are seeing from buyers.
If the more bullish green count is in play, all of these internal signals will have to be broken to the upside while momentum and volume will need to expand from here.
Another concern worth mentioning is the current cycle in play with Bitcoin. The below chart shows Bitcoin trending higher into a cluster of large cycles. What matters with cycles is how we trend into them – more times than not, they indicate a reversal of the trend heading into their window.
While the cycle work that I do is secondary to what price does, this chart further supports the precarious spot Bitcoin is in. Ideally, we would see these cycles pointing to a relative low, or period of consolidation before a bigger break out. However, until the above concerns resolve, we will maintain a defensive posture.
On a smaller time frame, the below chart outlines the potential paths that the price action can take. As mentioned above, we will need to see the internals on the weekly chart improve, as well as supports hold into the current cluster of cycles.
- Green – The swing higher is incomplete and should get into the mid $120K to lower $130K range. Once completed, we should see a 3-wave pullback that holds over $105,000. If this breaks, the risk will increase.
The final support for the bullish count will be $93,200 – $86,000. Though the risk will be elevated below $105,000, if we can hold these above support regions, the setup to +$200K will remain intact.
- Red – This scenario was stated above. We are in the final 5th wave of the multi-year bull cycle, which is targeting $125,000 – $135,000. We will then see a larger pullback that will break through $105,000, $93,200, and finally $86,000. If these supports break, it will increase the odds that a renewed bear cycle is underway, with general targets in the $70,000 – $40,000 region.
Nvidia (NVDA)
Nvidia has been a difficult stock to map since the June high in 2024. The reason for this can be seen below. Since, we have seen a series of three wave patterns in all directions, while price is only moderately higher than the June 2024 peak.
There are two counts that I’m tracking with NVDA:
- Green – It is obvious that the bounce off the April low is taking the shape of a 3-wave pattern. So, this would be the end of wave 1 of a large degree ending diagonal pattern. We would see a 3-wave retrace soon, which holds $116 – $111. We will then turn higher toward the $300 – $350 range in the following months.
- Blue – This count also has us in an ending diagonal, but on a smaller degree. In other words, we are already in the 3rd wave, which should be ending soon. The 4th wave drop should hold over $155 – $140 and then turn higher toward $192 – $216. This would complete the final 5th wave in the NVDA uptrend that started in 2022, and we should see a multi-month draw down that follows. If this does happen, it will likely set up a generational buying opportunity.
Bloom Energy (BE)
BE quickly became one of our largest positions on the recent breakout to new highs. There are currently two scenarios that best describe the current price action:
- Green – We have completed a leading diagonal for wave 1. This was followed by a rare and shallow 2nd wave. Today’s breakout was the start of wave 3, which should continue into next week. Any weakness has to hold $26.80–$28.50 or this count will be invalidated. The targets for this move are $66 – $108.
- Blue – This breakout will fail under $26.80, setting up a drawdown to the $24 – $20 region for a larger 2nd wave. We have to hold $18 for any further bullish pattern to continue.
Coinbase (COIN)
We started a position in COIN in late 2024 around the lows. Since then, we have been tracing what appears to be the last large swing in a very large diagonal pattern. This is a 5-wave pattern that has large moves in both directions, causing significant overlaps within the pattern. We are in the 5th wave of this large pattern, and there are two scenarios that best define the price actions:
- Green – I think COIN is going to put in a top before Bitcoin. It needs to hold $370 and then turn higher toward $445 – $476. This will complete a multi-year leading diagonal for wave 1. Wave 2 will take months to a year to play out and will target $149 – $82. This is where the generational buying opportunity lies. It was a good run. We are sitting on sizable gains, and we don’t need to be greedy.
- Red – Either we break below $370, or we make another high, as suggested above. We’ll then drop back into the $324 – $290 region, preferably. However, this drop can go as low as $222 and still be valid. As long as $222 holds, we can turn higher in 5-waves toward the $500 – $800 range.
Chainlink (LINKUSD)
We have been holding off on adding to LINKUSD until we get more clarity in the pattern. Since the December 2024 top, Chainlink went from one of the clearer charts that we track to one of the more confusing.
What cannot be ignored is the very large and clear 5-wave pattern that started off the 2023 low that pushed into the late 2023 high. This large degree pattern strongly suggests a higher resolution, which is why we are hanging onto our sizable LINKUSD allocation.
Based on the price action, the below counts represent the most likely outcomes:
- Green – The April low was the end of a large corrective bounce. Off this low, we got a nice 5-wave pattern, which further confirms a new uptrend is starting. We have also broken through the downtrend angle as we pushed toward the key $18 region. For this count to be in play, I want to see a continuation higher, while holding over $18. The lowest I can give this count is the $16 region. As long as these levels hold, and we keep pushing higher, then we are targeting the $35 – $54 region.
- Red – We are still in the large 4th wave. We will break down below $18, $16, then $11.75, which will setup a final swing lower toward the $8 – $7 region.
Ethereum (ETHUSD)
It’s hard to believe but Ethereum still has not broken above its 2021 high, even though it has risen quite a lot from the 2022 low. The pattern has taken the form of a messy and overlapping bounce, which means that there are two possible scenarios in play:
- Green – We are in a small 4th wave that should hold $3036. If held, we will turn higher toward 4120 – $4675. This will complete a large A-wave, which will be followed by a corrective B-wave. The likely targets for this correction will be $2795 – $2137. However, it must hold $1850. We’ll then turn higher toward $8000 – $10,000 in a final blow off.
- Red – After this next swing higher (or break of $3036), we will start a new bear cycle. We don’t want to own ETH during this.
Taiwan Semiconductor (TSM)
TSM is following a similar path as Nvidia:
- Blue – We are completing the 3rd wave of a small ending diagonal. This would mean that we are due for a pullback that holds over $187. This will be followed by one more swing into the $264 – $315 region.
- Green – We are tracing out a large ending diagonal pattern. Instead of completing the 3rd wave, we are completing the 1st wave. This will be followed by a larger correction that can break $187 but must hold $153.
Super Micro (SMCI)
- Green – SMCI is tracing a very large 5-wave pattern from the 2008 lows. The -85% drop in 2024 completed the 4th wave correction, as we are now setting up for the 5th wave swing.
For this to be in play, any weakness from where we are should see a drop into $42 – $35 region and hold over $31.50. This will set us up for a larger breakout that is targeting $107 – $181.
- Red – We are still in the larger 4th wave correction. The bounce since the November 2024 low has been a corrective bounce, making a lower high, and we are setting up for the final drop to $13 – $9. If we break below $31.50, this count will become the most likely outcome.
Credo (CRDO)
Credo is in the middle of the current Blackwell supply chain, while also having a relatively attractive valuation. It was also a primary target for our buys in March and April. We decided to step aside due to its elevated China exposure, which the market is rightfully looking past. Expect this to be a bigger position, as we strategically layer back into it at key levels.
- Green – We are in the final 5th wave of a leading diagonal pattern. The bounce off the April low was the first swing, which should be followed by a 3 wave retrace. This retrace will break below $93 to signal it is underway and should ideally hold $75 – $67; however, it can go as low as $46 and remain valid. Once this correction is over, we should see an aggressive push to new highs, with tentative targets in the $119 – $173 region.
It's also worth noting that there is evidence that institutions are very active in this stock between $88 – $93. If this level holds, and we see a strong break to the upside, it will negate the expected drop. It is rare to see a stock move as far as CRDO has in such a short amount of time with minimal pullbacks. However, its positioning within the Blackwell supply chain should be considered.
- Red – We already completed the diagonal pattern in the current swing higher. The coming correction will break $46, to confirm this scenario, and could take months to play out.
Advanced Micro Device (AMD)
Since the 2021 top, AMD has been in a messy consolidation to a very large degree. I think that we are in a very large B wave, which will either end this year or into next year. The below counts represent these scenarios:
- Blue – We are completing the final swing in a 3-wave bounce off the April low. Note how we are pushing up into a very heavy supply zone between $160 – $175, and we are doing so on weakening volume and momentum. We should see a 3-wave drop That holds over $101 – $96 before setting up for the next larger swing higher.
- Green – We had a tiny correction and setting up for a continuation of the vertical bounce off the April lows. If we can breakout over $160 and then $175, we should see a push into the target zone, which starts at $205.
Solana (SOLUSD)
We continue to get confirmation that Solana could be setting up for a large swing to the $400 – $600 region. For one, we have what can be counted as a 5-wave move off the April low. This was followed by a 3-wave correction that has made a higher low. We are now establishing a momentum position into the constructive price action. Below represents the general counts we are tracking:
- Green – We are in a minor dip wave that should target $176 – $152. It has to hold $152. We will then turn higher toward $242, which is where we start taking gains (sell half). We will then need to see either another pullback that makes a higher low, or a vertical breakout through $242 on heavy volume, for confirmation.
- Blue – This count has the push off the late June low as a corrective bounce within a larger correction. We will break through $152 in a more aggressive, and direct fashion, then head toward $125 – $111. We must hold $111 if this count plays out, or it opens the door to $60.
Oklo (OKLO)
Oklo is the first stock that we have included from our Discovery Tier. It is positioned within the A.I. energy space, which we believe, and have been saying, is a more immediate need for A.I. stocks.
- Green – We have a very large 5-wave pattern off the 2024 low. After a 3-wave pullback that made a higher low, we now have another 5 waves higher. The bullish breakout scenario says that we need to see another dip before an explosion higher. This count suggests that we got an unusually small dip and are setting up for an imminent breakout over $77, preferably on expanding volume and momentum. Any weakness before a breakout would have to be a 3-wave pattern that holds over $55.50, or this count will get invalidated.
- Blue – This count has us making a double top. We should see a 5-wave drop from here that breaks through $55.50. The targets for this drop would be between $45 – $30 and must hold $25.
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Meta (META)
META is competing a clear 5-wave push off the April low. Note how we are making new highs on weakening volume and momentum. There are two paths that the price action supports, as of now.
- Green – We will see a 3-wave correction that holds over $582 – $534. We will then need to see a more direct push off this low, which will setup a large breakout.
- Red – We are still in a large degree correction. The current bounce will give way to a 5-wave drop that break below $534. This will setup a target below the April low.
Applovin (APP)
- Red – APP is in a large degree uptrend. The drop in February was a correction within this larger uptrend, which completed into the April lows of 2025. We then saw the start of the next swing higher into the June high, which is being followed by another minor correction that is ultimately targeting the $270 region. Once price moves below $324, it will confirm this scenario. We must hold $240 if this scenario plays out, or we will be targeting the $150s in a continuation of the larger correction that started in February. If the $240s hold on any further weakness, we should see a setup for a breakout move that is targeting the $1000s for the next leg higher.
- Green – APP will hold $324 and instead see a breakout over $393 – $429. This will set us up for a larger breakout toward the overhead target.
Coherent (COHR)
- Blue – Coherent appears to be tracing out a large degree ending diagonal pattern. The April low completed wave 4, which would put us in the final 5th wave swing to new highs. Note how the current bounce has not made a new high. This will simplify COHR, as the next drop has to be a 3-wave pattern, and it must hold over $54. If this happens, the next swing will be a more direct and aggressive pattern that is targeting $136 – $196.
- Green – We had a very shallow B wave and are setting up for a 3rd wave move to new highs. This move should be vertical, ideally occurring on a gap and accompanied by expanding volume. The overhead targets are the same at the blue count.
Mara Holdings (MARA)
- Green – We are completing a minor correction within a larger uptrend. We must hold $15 on any further weakness. If we do, the next move higher will be around $23. We will then break through $23 and trend toward $29 – $42.
- Red – This bounce off the April low is a correction within a larger downtrend. We will either break through $15 imminently or fail on the next bounce under $23.
Dell (DELL)
Based on the obvious 3-wave drop from the 2024 high, there are only two scenarios that fit the current price action:
- Green – We are completing the first leg higher in a very large 5th wave. Note the current uptrend is pushing higher on decelerating volume and momentum. This implies that we are setting up for some type of pullback. We should see a 3-wave drop soon that ideally holds $106. However, this drop can go as low at $81 and still maintain this count. The 5th wave target would be around $180 – $200, and potentially higher depending on how shallow the coming retrace is.
- Red – We are in a large degree and complex correction from the 2024 top. The current bounce is a corrective bounce within this larger uptrend and should see one more drop below the April low. The next drop will be a 5-wave pattern that breaks through $77 for confirmation.
Potential New Stocks
We have been reducing risk on the current push higher, raising cash and locking in real gains. When we see a correction, the below names will be considered for inclusion into our portfolio.
Oracle (ORCL)
- Green – I believe that we are setting up for a decent pullback. The signals are plentiful, and once we move below $228, we will be in that correction. It must be a 3-wave pullback that holds: $210, $187, $172, $165. Then we will turn higher toward $350 -$475.
- Blue – We are at all-time highs after a vertical move off the lows. We already had the 3rd wave breakout and are in an ending diagonal. So, we will correct, but hold $228, then head toward $290 – $305 in a 5th wave.
Vertiv (VRT)
- Green – VRT is in a large degree 5-wave uptrend. The recent drop was a correction within this larger uptrend, as we are now setting up for the final swing higher. Note that price is flashing multiple sell signals – the detrend oscillator is at the same amplitude where previous corrections started, momentum continues to fade with volume as price pushes higher. We should see a drop back to $93 – $75, and it has to be a 3-wave drop. If any further weakness holds $65, we should be setting up for the larger breakout to new highs.
- Red – We are still in the large degree correction. The current bounce off the April lows is a corrective bounce within this larger drawdown. The next drop will be an aggressive 5-wave drop and break through $65. The final targets will be between $53 – $42.
Broadcom (AVGO)
- Green – Broadcom has been tracing a very large diagonal pattern since the COVID low in 2020. This count has us completing the first leg higher in the 5th wave. Note how momentum and volume continue to fade the higher we go. We should see a pullback to the $240 region, at minimum. The ideal targets for this correction are between $218 – $180. Once this pullback is over, we should continue to new highs with general targets between $335 – $482.
- Red – The bounce off the April low is a large bounce within a larger correction. We will break through $180, which will shift the odds in favor of this count. The targets for this drop will be $139 – $127, and it will complete a large correction within an even larger uptrend.
Palantir (PLTR)
- Green – We are in an ending diagonal, which should lead to a swift move back to the $121 – $107 region. This will hold and then turn higher toward the $180 – $215 region. This will complete the 5th wave in a very large 33rd wave.
- Red – This move off the April low resembles a 3-wave pattern. It is a B wave and should lead to a 5-wave drop that breaks through $107, and then $96 – $80. The final support will be $66 – $48, and it will complete a very large 4th wave correction within a larger uptrend.
Cloudflare (NET)
NET is a stock that we owned in the past and sold for nice gains. Now that the inference market is heating up, we believe it is worth revisiting. However, the current valuation and stock pattern suggest waiting for better prices.
- Green – We have completed a very large 1st wave in a new bullish uptrend. The drop into the April low was wave 2, and we are now in the early stages of the 3rd wave. We need to see a minor pullback into the $148 – $130 region, and it has to hold $119.
- Red – We are still in the larger 2nd wave. The bounce off the April lows is a correction within the drawdown, and we should see a 5-wave drop that breaks $119. This will set up a final target in the $98 – $67 region.
There are two more stocks that we intend to add in the coming pullback that are in our Discovery Tier. Join us on Monday, August 18th at 4:30 pm, for our first ever Discovery Webinar! We will go over the technical setups in each stock within this tier, including the two that we intend to add.
To subscribe to Discovery with 30% off, please click here to email usclick here to email us or email premium@io-fund.com and mention code DISCOVERY30.
Please note: The I/O Fund conducts research and draws conclusions for the Fund’s positions. We then share that information with our readers. This is not a guarantee of a stock’s performance. Please consult your personal financial advisor before buying any stock in the companies mentioned in this analysis.
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