The market is currently pricing in up to three rate cuts this year, which is putting pressure on Magnificent 7 stocks, defined as Apple, Alphabet, Amazon, Meta, Microsoft, Nvidia and Tesla. Due to their global exposure, heavy cash positions and positioning within the growing AI trend, they have been perfectly situated to benefit from a bifurcated and complex macro environment. Because of this, the Mag 7 has significantly outperformed the broad market, and also led it higher for nearly 2 years.

To put this into perspective, the first six months in 2023 was the biggest 6-month rally in Nasdaq history – and since then, over a year ago now, the NASDAQ has plowed through key levels to reach a staggering 72% return in a little over 21 months. It’s not only the returns we’ve seen in 2023 and 2024 that are unusual, but the fact it happened back-to-back. Tech investors can thank the Mag 7 for this spectacular outperformance.

However, we are now getting evidence that a change is happening. As excitement over reduced rates has investors rotating into beaten down small caps and consumer facing stocks that have sat out tech’s historic rally.

By not participating, small caps and other pockets in tech that are more traditionally cash-strapped are now undervalued. Optimism around the Fed could spark a continuation of the relief rally in the Russell 2000 and further rotation out of the Mag 7. Below, we look at the pros and cons of a Mag 7 rotation and how we plan to personally handle this shifting landscape.

Why The Mag 7 Worked

The complexity of this business cycle can’t be overstated. On one hand we are seeing one of the longest and steepest yield curve inversions in market history. This signal has a near perfect track record of predicting recession, which is being backed up by a weakening consumer, and a deep and prolonged manufacturing recession that is now filtering into the services sector. On the other hand, corporate profits are healthy, the job market remains relatively tight, and AI is creating a new economy that is driving historic top line and bottom line growth for the AI leader (we think there will be many moremany more beneficiaries beyond Nvidia).

This bifurcation within the economy can be seen in equity markets. For example, markets that are dependent on a strong consumer, thrive with lower interest rates, or in need of cheap money to expand – like high beta tech, small caps, real estate, consumer discretionary – are still well below their 2021-2022 highs.

At the same time, we are seeing markets that have global exposure, flush with cash and are not dependent on the consumer, all well above their 2021-2022 highs. This is most obvious with the Mag 7, who were leading this market higher in early 2023, and continuing into today.

For this reason, we need to take a closer look at select charts within the Mag 7 to get an idea on where the market is going over the short-term, as well as the medium to long-term.

Sign up for I/O Fund's free newsletter with gains of up to 2600% because of Nvidia's epic run – Click hereClick hereClick here

Certain Stocks Within the Mag 7 Continue to Provide Clues

Our broad market analysis in 2024 has been focused on the relative performance of the Mag 7. Without question, these 7 stocks are the most important stocks in the current bull market. Historically, as long as the cycle leaders continue to move higher with the market, all is well. However, as stated in our March Report…

“When the cycle leaders start to underperform, it tends to mark the start of a trend change. The Magnificent 7 have been the undoubted leaders of this bull run, and we are now seeing them start to trend lower against the indexes. More times than not, the leaders on the way up, tend to be the leaders on the way down.”

This was the pattern that warned us about the April selloff, and again in July.

What followed our March report was a 6.3% drop in the broad market. However, high fliers like NVDA and META dropped 22%, TSLA dropped an additional 32% while the rest of the Mag 7 dropped between 15% – 10%.

Since then, the market has recovered and resumed the bull market higher; however, we have seen new leadership emerge from the Mag 7. Since the April 19th low, the S&P 500 is up +12%, while Apple is up 32%, Nvidia is up 64% and Tesla is up 77%. Lead Tech Analyst, Beth Kindig, pointed out on Bloomberg Asia that Tesla was simply trading too low at the time, and to look for a bounce.

What is interesting is that the same pattern that we saw from the Mag 7 in early March, was also warning investors leading into the July 16th high.

Nvidia first started making lower highs on June 10th, followed by Tesla on July 10th, and then finally Apple on July 15th. So, while the broad market continued to make higher highs, it was doing so without its leaders, signaling that trouble is likely ahead.

What The Majority of the Mag 7 is Saying Now

The divergence above within the Mag 7 stocks warned us of the coming volatility. We can use further analysis of these important stocks to help tell us what the market may do next.

Of the Mag 7 charts, Apple, Microsoft, Nvidia, Amazon and Google are the clearest. They all suggest that what we are seeing is a correction within a larger uptrend, and that it is likely that we see higher levels in the coming weeks. While Meta and Tesla can be interpreted in the same way, they are not as clear as the ones we will discuss below. For reference, the 5 stocks below account for ~28% of the S&P 500, and should have a very strong correlation on the direction of the broad market over the coming weeks to months.

Nvidia

Nvidia is the most important stock in the current bull market. Within the most recent bull market, it has gone from a top 25 stock in the S&P 500 to now the 2nd most valuable company in the U.S. due to its positioning within the new AI trend.  Our firm was the first to lay out NVDA’s path to becoming the most valuable company in the world. Now that it has surpassed Apple, we further presented how it has a clear path to becoming a $10 Trillion Company by 2030.

Since the 2022 low, NVDA has been tracing out a very large 5 wave pattern higher. Note the vertical move higher in early 2024. This was met with max volume and max momentum to the upside. This is the marker that you are in the most powerful moment of a trend, which is the 3rd wave. This is also around the halfway point of the entire 5 wave pattern.

The pattern appears to be incomplete. Even though NVDA topped early, the drop is a clean 3 wave pattern within an incomplete uptrend. We still need a 5th wave to new highs in order to complete the larger 5 wave move.

Nvidia may have one more drop into the $113 region before bottoming, but appears to be developing a bottom right now. Look at the momentum indicator below. It is bottoming in the exact same region the April low tagged, and it is doing so while price is much higher. These are the type of bottoming signals we look for when degerming a low is close within a developing uptrend. As long as any further drop holds $103, we expect NVDA to push higher.

Apple

With Apple’s push into bringing AI to the consumer, coupled with the likelihood that the Fed will lower rates soon, Apple has stopped becoming a laggard and is instead one of the leading Mag 7.

It appears to be a bit further along in its uptrend pattern off the 2022 low. While NVDA needs a large degree 5th wave, Apple is missing a smaller degree 5th wave. Like NVDA, the pattern is incomplete while giving us clear bottoming signals.

Note how the momentum indicator is making a lower low from the June low into today’s low. This is happening while price is making a higher low. This is the type of pattern we see in on-going uptrends, and supports that we should see another swing higher into late summer/early fall. As long as Apple hold over $206, we expect to see this move higher manifest.

Microsoft

Our firm recently closed MSFT for a sizable profit due to valuation concerns. While the chart does suggest it has one more swing higher, we see other stocks within tech having more upside in both valuations and technical targets. For this reason, we have rotated these gains into Nvidia, as well as other AI stocks that we have been targeting for months.

However, like Apple and Nvidia, Microsoft is a bellwether for the broader market and an important stock to cover. It is very rare to see MSFT move against the market, and when it does, it is a sign of a brewing trend change.

The below chart shows a very mature uptrend off the 2022 low. We have a very large 5 wave pattern that is suggesting it has one more swing left. This would be wave 5 of a larger 5th wave, and is estimated to be anywhere between 8 – 15%.

We are seeing similar bottoming patterns in MSFT as we saw in AAPL. Microsoft appears to be completing what looks like a 4th wave drop. As long as any further weakness holds $406, I expect a final 5th wave push in the coming weeks.

Amazon

Amazon looks a lot like MSFT and AAPL. It is tracing out a 5 wave pattern and needs the final 5th wave higher to complete the uptrend. The current drop also appears to be a 4th wave and showing bottoming signals like the above charts. As long as AMZN can hold $174.50, we expect a 5th wave bounce in the coming weeks.

Google

Google is making a lower high while it is at extreme oversold conditions. Like the above charts, it looks like it needs one more high to complete the larger 5 wave pattern. As long as any additional weakness can hold $169, it looks like it needs a 5th wave bounce to complete the bigger uptrend.

Broad Market

The broad market in the S&P 500 is signaling the same push higher that we are seeing in the above key stocks. While it appears that we have another move higher to look forward to, according to the larger pattern in play, the next move will likely be the final move we see before having to contend with, at best, a multi-month and deep correction.

The pattern that the S&P 500 is tracing off the 2022 low is what is called an ending diagonal pattern. It is the only pattern that can account for the messy, overlapping moves that we have seen in both directions. The only question is what degree of a 5 wave pattern is in play, which is what my two counts represent.

• Green – This count has the 2022 bear market as a large degree 4th wave in the secular bull market that started in March of 2009. That would put us in the final 5th wave, which is developing as a large ending diagonal pattern.

  These patterns are 5 wave patterns that overlap. More times than not, the 4th wave will go be so deep, as to move into 1st wave territory. The next swing higher would be the final move in the 3rd wave, which would be targeting 5850 – 6340. Once this 3rd wave ends, the 4th wave would likely be a multi-month drop and on the larger side of a bull market correction. This would set up a tremendous buying opportunity, once completed.

• Red – This count has us in a smaller degree ending diagonal pattern. It has an extended 5th wave that is playing out. The targets would be the same as above, 5850 – 6340 SPX. However, unlike the green count, we would not see a 5th wave to new highs, but instead a lower high in a much larger downtrend.

As long as any further weakness holds over 5375 – 5200, we should continue to see the bull market continue for another move higher. Below this level decrease the odds of this happening. The final support for any pattern that can take us higher would be 5,200. Below this level and the larger period of volatility will have likely begun.

Small Caps

The June CPI numbers came in softer than expected. This coupled with weakening economic data, triggered the market into a rotation based on the expectation that the FED will have to cut rates sooner rather than later. As a result, the Russell 2000 is up about 9% from that moment, while the Mag 7 are down an average of 13%. Furthermore, we are seeing an expansion of breadth into more consumer based value stocks as well as some high beta names.

As stated, it appears that the majority of the Mag 7 and the S&P 500 are supporting another push higher. This is also supported by small caps. The benchmark for small caps, the Russell 2000, for example, appears to be in a 4th wave correction, which is around the halfway point of the move higher. As long as any further weakness holds $211 (IWM), like the rest of the markets and stocks we covered, it should continue higher before putting in a more meaningful top.

The broads Small Cap Index is also suggesting that a low is being put in and we should see another swing higher. The upside pattern is incomplete and likely around the halfway point of the move higher. However, we do still believe this is a stock pickers market, so we have positioned some of our portfolio into select small cap positions that have exposure to AI. While the rotation into small caps may continue, it looks like the bulk of this rotation is complete, as the broad market is setting up the next leg higher.

Realized Volatility

Realized volatility (RV) is a measurement of price swings on a day-to-day basis. The lower RV is, the smaller swings in either direction are to be expected. Ideally, you want to see RV trending lower as price moves higher. This tends to mark a healthy uptrend.

The best way to think about Realized Volatility is as a measurement of liquidity entering or exiting the markets. The more liquidity there is, the smaller the moves we tend to see, as the market continues to grind higher. The higher Realized Volatility goes, the less liquidity is in the market – i.e., big money is raising cash, which can cause larger swings in the market.

What matters to me is how Realized Volatility is trending with the market. This is what we are seeing today. Look at the 10-day, 20-day and 30-day measurement of Realized Volatility is trending up with price. The last time RV hit these levels that we last around the April low. This is significant, as it is indicating that liquidity is leaving the markets while price is much higher.

As long as Realized Volatility continues to trend higher with price, it is a warning that liquidity is exiting. However, this also means that less liquidity can propel the markets higher up to several months.

Note the two most recent periods this happened – 2020 and 2022. Once we saw RV start trending higher with price in 2022, we only saw a 5% move higher over a 1.5 month period. However, in 2020, this trend lasted for +3 months and led to a 10% swing higher in the markets.

Conclusion

In conclusion, the stage is set for a meaningful move higher, if we can see SPX break above 5670. While less liquidity tends to mark the early warning of trend reversals, it also means that any bullish catalyst can propel the markets higher in larger than normal daily swings. This lines up with what the majority of the Mag 7 is suggesting – a 5th wave rally to new highs is needed to complete the larger uptrend.

As long as the supports listed hold, this is what we are expecting. While the next move higher could last anywhere from a few weeks to several months, it’s important for investors who are buying the dip to realize the risks involved within the larger picture. While being nimble can pay off handsomely in moments like this, not having a risk management plan can do the opposite once the market rolls over.

If you are sitting on outsized gains from the current bull market, looking to protect those positions, or interested in owning AI leaders at reasonable prices, join us each Thursday, at 4:30 EST for our premium members webinar. This week we will discuss our risk management plan, buy and trim targets for various AI positions as well as crypto. Learn more about I/O Fund’s premium services herepremium services here.

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.

Recommended Reading:

• Tesla’s Q2 Deliveries Strong, But What’s To Come?
• How to Participate in Tech: The Million Dollar Question (Video Highlights)
• This AI Stock Could Outpace Nvidia’s Returns by 2030
• The Risk is Higher in the Market than it Feels

Our last broad market report entitled “The Magnificent 7 are Falling Like Dominoes; Only 3 Remain” warned investors that risk was building in the markets. Specifically, it was discussed that the current market leaders, deemed the indestructible “Magnificent 7,” were putting in tops one leader at a time. First Tesla put in a top, then Apple, Google and Microsoft, all started making lower highs, while the broad market kept trending higher.  As we stated in that report, “When these cycle leaders start underperforming, it usually marks the start of a trend change.”

Just days later, the AI powerhouse and market leader, Nvidia, put in a top on March 8th, while the S&P 500 continued higher. This left only Amazon and Meta from the original Magnificent 7 pushing higher with the S&P 500.

Source: I/O Fund

Sure enough, on March 28th, the S&P 500 followed the Mag 7 down, as we are now seeing volatility pick up for the first time in over 5 months. Now, investors are wondering if this is a buying opportunity in a larger uptrend or the start of something more severe?

In this report, we will show that the sentiment readings over the last several months suggest investors should be cautious. This is backed up by our broad market analysis, which indicates that risk is more elevated than most investors may think. This doesn’t mean we can’t push marginally higher. Instead, it is suggesting that the downside is greater than any additional upside. Interestingly, the last two standing from the Mag 7, Meta and Amazon, appear to be giving the strongest clues that we could see more volatility over the coming weeks to months.

Historic Sentiment

The below graph measures the percentile rankings of the weekly AAII Investor Sentiment Survey going back to 1987. The survey simply asks a group of investors where they believe the market will be going over the next 6 months.

Based on the answers, it provides a percentage of those surveyed that have a bullish or bearish outlook about the markets. It then measures the spread between the bulls and bears to provide a comprehensive reading regarding market sentiment.

It is best used as a contrarian indicator. The idea is that the more extreme the readings become, the closer we are to trend change.

Source: I/O Fund

Based on recent volatility, the participants are starting to get more concerned about the future markets, as you can see the increased number of bears over the last 2 weeks. However, look at the highlighted period November 2023 – April 2024. The spread between the bulls vs. the bears during this 22 week period stayed in the 70th percentile of all bullish readings going back to 1987. Out of these 22 weeks, 13 weeks were in the 90th percentile of all bullish readings.

We have not seen a consistent streak of exuberance that lasted this long within the history of this survey. The closest period was December of 1999 – February of 2000, where we had 18 weeks where the spread between bulls and bears were in the 70th percentile, with 14 of these weeks above the 90% threshold.

This level of exuberance warrants cation based on historic readings. Sentiment is a powerful measurement, as investing is not a zero-sum game. For every buyer, there must be a seller, and when everyone piles into the same side of a trade, willing to pay any price to get more gains, there is only one way for the market to go.

Broad Market

The extreme sentiment readings are coinciding with a potential top, of sorts, unfolding in the broader market. The S&P 500 broke out to new all-time highs earlier this year, which means that the 2022 bear market was just a deep correction within a larger uptrend.

The pattern that has unfolded in this new bull cycle has taken the shape of a common technical pattern called an ending diagonal. This is a choppy, and narrow pattern that traces within a channel and always consists of five waves. Most importantly, these patterns only show up in the final 5th wave, which is the end of a trend.

Source: I/O Fund

Note how we are very far along in the 5th wave pattern, and touching the lower boundary of our 5th wave topping zone. We are pushing higher on fading momentum, which is a typical sign that we see in the final 5th wave of an uptrend.

The breakdown, so far, has made a push into the upper regions of the 5th wave target box less likely. However, until we break below 4950, there is a chance we could push higher before rolling over. It would require the market not making a new low, and then breaking out above the 5225 level.

Source: I/O Fund

Based on the current price information, I believe we are still in a downtrend, which is bets shown in the chart below.  The below path in blue shows an overlapping bounce off the recent lows. We can still push higher from here, but as long as we do not see a vertical breakout above 5225, I expect this bounce to fail as we push lower. A break below 5015 will be the first warning, and the final support will be 4950. If we do break below 4950, what my particular style of analysis tells me, is that there is not a path to new highs within the ending diagonal pattern that started in October of 2022. We will need to see a sizable correction, at best, in order to start a new pattern pointing higher. For this reason, it is likely that we see volatility pick up.

Source: I/O Fund

The Mag 2

The final two Mag 7 stocks appear to be supporting the conclusion that a top is in place. Meta, for example, has been tracing the final 5th wave off the November 2022 low. Note how this final move higher has happened on lower momentum. This is common in the final 5th wave of a trend.

Source: I/O Fund

There is a low probability that we hold $406 and turn higher for one more high. However, I find this to be unlikely based on the additional clues within the chart.

The choppy consolidation after their Q4 results resembles a distribution top, which is where we see large institutional trades sell to an eager retail crowd. This was confirmed by the recent earnings report resulting in a large gap below the major trend line, which happened on heavy volume.

Sign up for I/O Fund's free newsletter with gains of up to 370% – Click hereSign up for I/O Fund's free newsletter with gains of up to 370% – Click hereClick here

Also, it’s worth noting the importance of gaps within an uptrend. These are literal gaps between the closing price and opening price, usually on heavy volume. They are key markers within a trend and tend to unfold in 3s: the breakaway gap is the 1st indication that a new uptrend has started, the runaway gap typically happens around the halfway point of the larger uptrend, and the final gap is the exhaustion gap, which tends to happen around the end of the trend. So far, this is exactly what we have seen, and was confirmed with the recent selling gap, which tends to signal a trend reversal.

Source: I/O Fund

Amazon is another Mag 7 stock that is signaling a larger pullback is likely underway. Note the clear 5 wave uptrend off the 2022 low. Just like in Meta, the final 5th wave in Amazon was happening on weaker momentum, signaling that the strength in the uptrend was fading.

Source: I/O Fund

What follows a five wave uptrend is a correction of the same degree. We are unfortunately dealing with a 1.5 year five wave uptrend. If this is what is playing out, this means we should see a multi-month correction, which should retrace most of the final push off the October 2023 low.

Amazon’s pattern is an ending diagonal, which is another piece of evidence supporting the final push will be a top for Amazon. As stated earlier, these patterns are tight, with choppy moves higher that trace a trend channel. They happen as the final 5th wave of a move, and when they end, we tend to see a swift drop back to the start of the pattern.

Source: I/O Fund

The above ending diagonal pattern took 21 days to complete and only 6 days to retrace the entire pattern, which further confirms that this is likely an ending diagonal. Since these patterns only occur at the end of a move, we are likely setting up for more volatility into the coming weeks – months. If the current bounce can break above $190, then we could see an extension of this final 5th wave higher before rolling over.

A Note on Google

The divergences discussed in our last report regarding the Magnificent 7 was the clearest signal that a correction was building. Google was the 3rd of the seven to start making lower highs against the market pushing higher. This was the right call, as the market is now in a clear correction.

However, GOOGL recently pushed to new highs in their last earnings report. I believe this push was the final 5th wave within a pattern called an expanding diagonal. This patter is common in 5th waves, and also lines up with the rest of the market. Note below how the  final 5 waves each moved respected the expanding trend channel. If GOOGL closes the recent gap around $157, this will be the first signal that this pattern is in play.

Source: I/O Fund

Regardless, future market leaders will emerge from volatility. They will go down less than the broad market and tend to bottom before the broad market. It is too soon to tell, but this move in GOOGL is one we are watching as a potential market leader when this volatility ends. 

Conclusion:

The last six months have been a historic, and nearly vertical move higher. From November 2023 to March 2024, we have not seen even a shallow pullback — which is uncommon. With that came a level of exuberance that has not been recorded before in the AAII Investor Sentiment Survey. The level of greed in the market has not only created extreme valuations with stocks, but it created a tight rope that the broad market had to walk in order to keep pushing higher.

Once the recent volatility broke below the 5080 – 5055 support zone, the odds tilted in favor of a top being in. As long as we hold 4950 and break back above the 5225 region, we can extend this move higher. However, if 4950 breaks, we will have full confirmation that a top is in as the next move tests the 4800 – 4600 region. Because of this, we believe this market warrants caution.

If you own Tech stocks or are looking to own Tech stocks, consider joining us for our next broad market webinar. Every Thursday at 4:30 pm Eastern, the I/O Fund team holds a webinar for premium members to discuss how to navigate the broad market, manage risk, as well as revealing our various long-term game plans regarding stock entries and exits. We offer trade alerts plus an automated hedging signal. The I/O Fund team is one of the only audited portfolios available to individual investors. Learn more here.

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.

Recommended Reading:

• We Are Raising Our Bitcoin Targets To $106K – $190K
• Investing In AI with Beth Kindig: 1-Hour Video Interview
• Semiconductor Stocks Q4 Overview: AI Gains Heat Up
• Top 3 Ad-Tech Stocks For 2024

In 2023, the Nasdaq-100 saw its best year since 2009 with returns of 54%. Meanwhile, the S&P 500 finished the year up over 24%, which rivaled 2021’s banner year. The question that should be on every investor’s mind in 2024 is – will this performance continue? 

In this article, I lay out both the bull and bear cases for 2024 and beyond. Interestingly, both are calling for a level of volatility in 2024 that will, at least, retrace the rally we’ve seen since November 2023.

Bull Case vs. Bear Case

All trends fit within repeatable patterns. In technical analysis, these patterns repeat in all markets and on all time scales. The only bullish interpretation of the pattern that has developed off the October 2022 lows is what we call a leading diagonal pattern, which generally develops as shown below.

This is a 5 wave pattern that has large and choppy swings in both directions. The key is the 4th wave moving into 1st wave territory, which is what happened in 2023.

If this is what is playing out, then it’s worth noting the 5th wave is coming to an end. This means the larger pattern is almost complete, which should give way to a multi-month correction. The implication here is that the leading diagonal is the 1st wave in a very large 5 wave pattern that will take years to complete.

I have many problems with this scenario, the biggest one is that it does not fit within the context of the secular bull market that started in 2009. That bull market pattern simply does not have room to allow for another multi-year bull run, which makes this scenario a low probability outcome. 

The bear case, which does fit in within the larger context, suggests that 2023 was a cyclical bull market within a secular bear market. In Elliott Wave speak, 2022 was your large A wave, 2023 is the large B wave bounce, and 2024-2025 will be your large C wave drop to new lows.

Regardless of whatever the long-term pattern that unfolds, it’s worth noting that both interpretations are calling for a multi-month drop into mid-2024, which should retrace the bulk of the rally off the November 2023 lows.

Timing the 2024 Top

The pattern that is playing out since the November lows in 2023 can be interpreted in three general ways. Keep in mind, it is part of the larger leading diagonal pattern that started in 2022. This means that there is a limit to how high it can extend from here.

• Red Count – This count suggests that we are in the final 5th wave within the larger uptrend pattern that started in October of 2022. We should see the markets roll over soon once this final 5th wave ends.
• Blue Count – this count has us in a 3rd wave, which should lead to a minor dip, followed by a final 5th wave into the 5000 – 5050 region.
• Green Count – this pattern will see a deep retrace followed by a bullish leg into late March/early April. 

When we analyze other markets, the evidence suggests that the green count is a low probability scenario. The likely outcome will be a complex topping process that starts in late January and lasts into mid/late February.

Intermarket Analysis

The green count is calling for a deep retrace of the November rally, followed by a rally that should be equal in length. The problem with this scenario is that most markets are only showing a potential minor swing higher from current prices before completing their larger pattern.

Dow Jones Industrial Average (DJI)

DJI appears to be in a complex correction that is taking us to new highs. If accurate, once complete, we should see a 5 wave drop that eventually retraces all of the 2023 rally. The current pattern is in the form of a 5-wave move, which has all 5 waves intact. The question is how much farther can this last swing extend?

German Dax

The DAX, which has a history of leading the U.S. markets, also looks like it is in the process of working through the final 5th wave swing to complete the larger uptrend pattern. Note how price is making a higher high on lower volume and momentum. This is classic 5th wave behavior – peak volume and momentum tends to happen on the vertical 3rd wave, with less participants in the 5th wave. The question now is – how much higher can it go? We technically have all waves in place, so the upside is much more limited when compared with the downside potential from here. 

Equal-Weight S&P 500

The Equal Weight S&P 500, which is stripped of tech dominance due to each stock containing equal weighting, looks similar. It needs a 5th wave to complete the larger pattern. If this happens, it will likely be a bull trap for those attempting to buy the breakout to all-time highs.

Japanese Nikkei

The strongest global market, the Japanese Nikkei, is marching towards what could be one of the largest double tops in market history. the symmetry if this larger 5 wave push lines up with these levels quite well. If accurate, we still need a 4th and 5th wave push into this zone, which supports a limited continuation of the current rally.

I’m showing some of the more bullish markets in the world. What they all have in common is the same scenario – we are looking at a minor swing higher, at most, which could take us into late mid-February – late-March, before we see a bigger pullback into 2024.

Even the bullish scenario suggests that a multi-week to multi-month correction is likely as we move into 2024. How this correction unfolds, and how deep it goes will tell us whether to raise more cash into any following bounce, or to continue to add to our longs. We will update our readers as we progress.

Divergences

When an index breaks out to new highs from a previous correction, a healthy trend would show many markets participating in that move higher. The more markets participating in the new move higher, the more likely it is to last. However, major indexes are breaking out to new highs while other markets are not, it is a warning sign that we are close to a turning point in the trend.

The below chart showing the S&P 500, NASDAQ-100 and Down Jones Industrial Average on the top panels, all are breaking out to new highs. However, on the below panels, small caps, high beta, and transportation stocks, prior leaders in the prior rally, are not confirming this move higher.

More importantly, one of the largest stocks in the S&P 500 and NASDAQ-100 is also not confirming this breakout move. Apple is currently 7% of the weighting in the S&P 500 and over 9% in the NASDAQ-100. This is a big weight within these indexes, which is signaling caution to the on-going bullish trend.

Apple is stalling at the $197 – $200 region, while heading for a triple top potential. The current bounce is happening on less volume and less momentum, while the internal momentum is at a new high without price. These tend to be sell signals.

With that said, we are watching Apple’s earnings results with outsized anticipation given the technical picture just described. On the other hand, a sustained break below $190 will further build the case that the market has likely already begun a larger correction than most anticipate.

What the bulls need to see is Apple break above the $200 region, then retest and hold that level as support. If this happens, then we could see the warnings stated in this report start to get reversed, as the market extends higher.

To reiterate, if Apple fails to break $200 in a meaningful way, and instead turns lower all tech investors should pay close attention.

In conclusion, regardless of what the long-term outlook is in the US markets, the near-to-intermediate term favors a deep retrace into 2024. As shown, most key global markets suggest more upside is likely, but they also support volatility into 2024. With key markets diverging, and not confirming this breakout to new highs, we are likely closer than most think to market reversal.

If you own any FAANGs, especially Apple, or are looking to own any of the FAANGs, we encourage you to attend our weekly premium webinars, held every Thursday at 4:30 pm EST for premium members to discuss how to navigate the broad market, as well as various stock entries and exits. We offer trade alerts plus an automated hedging signal. The I/O Fund team is one of the only audited portfolios available to individual investors. Learn more here.

Disclaimer: This is not financial advice. Please consult with your financial advisor in regards to any stocks you buy.

Recommended Reading:

• Coinbase, Robinhood: Examining The Impact Of Spot Bitcoin ETFs
• Tesla Q4 Earnings Preview: Margins Likely To Slip Again
• Social Media Stocks: One Metric Shows Meta’s Clear Leadership
• Five Top Stocks Of 2023: Year In Review
• My Firm called the Bitcoin’s Bottom; Here is Where the Price Goes Next

This is a complicated market, and there is really no better image to prove this point than comparing the transportation juggernaut, UPS, to the big tech juggernaut, META. While UPS has broken below its October 2022 lows and is currently in free fall, META’s uptrend is incomplete, and needs one more push higher to at least the $370 level before completing.

The majority of other sectors are confirming a continuation of the 2022 bear market, meanwhile, a handful of big tech names, with outsized weighting in the major indexes, suggest that they want to go higher. Though this pattern of narrow leadership where the market is held up by 7 stocks is unsustainable and a warning of an unhealthy market, it can continue, and likely will, at least into late 2023/early 2024. 

With markets continuing a nearly 3-month correction, the consensus is now confirming what we have been saying since July.

“We do not believe a recession is priced into equities, and that it is inevitable. However, this doesn’t mean that we can’t see higher levels from here, before a recession hits.”

In other words, bearish sentiment is now accompanied with the mainstream news is calling for an imminent market crash. This is after flooding the market with non-stop narratives about a soft landing.non-stop narratives about a soft landing.

However, unlike the consensus, we believe this final swing higher in the markets has one more run in it before the secular bear market that started in 2022 commences again.

Five Stocks (Not Seven) Can Lead to New Highs

Nasdaq had the best first 6 months in the index’s history, and this rally was propped up by seven stocks known as the Magnificent 7: Apple, Amazon, Meta, Tesla, Nvidia, Microsoft and Alphabet. Meanwhile, the rest of the market is struggling. Many argue otherwise, but the picture below is worth a thousand words in terms of illustrating the narrow leadership of this market.

What is most concerning is that the equal weighted S&P 500 (RSP), which gives the same weighting to all 500 stocks in the index, is actually negative for the year. This matters because in a healthy economy, all sectors tend to participate, while mid-caps tend to outperform large caps. So, when the equal weighted S&P 500 is outperforming on a relative basis, it tends to be a good sign for the foundation of a new bull market.

The Equal Weighted S&P 500, like many others indexes, has put in a large top, and will likely not see a new all-time high for a long time. Note in the below chart that RSP could not sustain above its February highs, and has now broken through the major trendline in a 5-wave pattern.

If the market is going to continue the bear market that started in 2022 to new lows, it will have to take the form of a 5-wave pattern pointing down. These patterns are fractal, which means that a small one builds into a larger one until we reach our target. So, the fact that the current drop in RSP is taking the shape of a 5-wave pattern is quite concerning, and also confirms that we are likely still in a larger bear market.

However, markets do not drop in straight lines. The current 5-wave pattern is only the first wave (of 5) that should take us much lower. What follows this pattern is always a 3 wave retrace that makes a lower high. So, even though sentiment is prepping for a crash, we still have one more bounce before that happens.

Even with this weakness we are seeing throughout the market, the magnificent 7 stocks account for ~28% of the S&P 500’s total weighting, and nearly ~42% of the NASDAQ-100. It is feasible that even with the broad level of weakness we are seeing, a handful of these stocks can push the bigger markets higher, and even potentially make another high in the NASDAQ-100.

The Macro Backdrop

In late August, we stated that..

“According to the economic trends we are seeing, there is simply no evidence of a recession brewing in Q3 of this year, and this is important for investors to realize this when looking for some type of top.”there is simply no evidence of a recession brewing in Q3 of this year, and this is important for investors to realize this when looking for some type of top.”

This remains true today, as the resilience of the US economy is still chugging along.

Not only has retail sales accelerated for the 6th month in a row, but industrial production gave us the strongest 3-month annualized reading since May of 2022. Most importantly, employment is still quite strong. Once we see a sharp rise in the 4 week average for initial jobless claims, we can start to looking for an imminent recession. Until then, we simply see no sign that the economy is heading into a recession right now.

Furthermore, we warned our readers to be cautious of claiming victory over inflation in June of 2023.

“Peak inflation is behind us, but the real battle will be getting these numbers back to the 2% target. In fact, going back in history, there is no instance where core PCE inflation backs off from an inflation impulse without a recession.”Peak inflation is behind us, but the real battle will be getting these numbers back to the 2% target. In fact, going back in history, there is no instance where core PCE inflation backs off from an inflation impulse without a recession.”

This has proven to be true, as we have seen 2 months in a row of reacceleration in CPI numbers. Most importantly, these numbers have bottomed well above the FED’s 2% targets on a YoY basis. In the below chart, core inflation has remained well above the Fed’s target, while the incredible disinflation that we saw in the Spring/Summer was due to decelerating energy prices.

It has been our view that energy prices would make a run back to the highs in the coming months, and this new uptrend has further confirmed this thesis. However, as stated prior, markets do not move in a straight line. Now that we have a completed a full 5-wave move off the low in crude oil, which would be the 1st wave, we are now seeing the 2nd wave pullback.

Sign up for I/O Fund's free newsletter with gains of up to 221% – Click hereSign up for I/O Fund's free newsletter with gains of up to 221% – Click hereClick here

The most likely path is the count presented in green. We are seeing the end of the first leg in a 3 leg correction. This could take us as low as $76/barrel and could last through November/December. If this plays out, this will relieve pressure from the coming CPI prints, and allow equities to make the next leg higher.

This is further confirmed when we look at the Japanese Nikkei, which has a strange history of leading the NASDAQ. Japan must import all of their oil. So, if oil is moving higher, companies within the Nikkei will see contracting margins, which is not good for stocks. When we look at the Nikkei, much like many of the magnificent 7, it has an incomplete uptrend.

Note how the correction, so far, has been an overlapping mess of a pattern. This is very common in 4th waves. It also implies that a 5th wave rally is needed to complete the larger pattern. If Japan is going higher, oil is going lower, which should propel equities in the US through the end of the year.

What This Means for S&P 500

In mid-September we laid out 3 potential paths that this bull market would to into a major top. From our assessment, the odds of a recession were very low in Q3, which was proven correct. Because of this, if the July high was the actual top, then it would likely be an event that pulls forward the recession.

Our line in the sand was 4245 SPX, which we breached and have continued lower. Because of this, we have narrowed the potential paths to two, and are leaning into our top-is-in count, in red.

This drop in the S&P 500 has gone too low, and lowered the odds of us making a new high. However, at minimum, we are due for a sizable bounce over the coming weeks – months, which we believe will be led by a handful of Big Tech names.

My green count above sees the S&P 500 making one more high, which is not completely off the table. In order for this to happen, we would need to see Microsoft and Apple both present solid reports, and start new uptrends. A lot rides on how the market reacts to Apple’s report. We would also need to see Amazon, Meta, and Nvidia participate, all of which have charts that can allow for one more high. So, it’s not improbable to see the above green count play out with only a handful of stocks leading.

These scenarios are what we are game planning for, while also keeping a cautious eye on the bigger picture – we are likely setting up for a return of the bear market sooner than most think. For this reason we have been quite defensive for most of the year. If we instead see a vertical drop from these levels that takes us below 4000 SPX, we will drop the thesis that we are setting up for a bounce, and assume that we are the central part of this drop.

In conclusion, we have been adamant that we are in a cyclical bull market within a secular bear market. The macro environment as well as weakness outside of the magnificent 7 has only continued to prove this thesis. However, in this environment, we only need 5 stocks to keep the market moving higher. With no recession in sight, and oil relieving inflation fears, the market is setting up for a move higher in the coming weeks/months. Regardless, if we make a new high or a lower high, the next sizable bounce we will use to further de-risk our portfolio

Recommended Reading:

• Big Tech Stocks: Q3 Earnings Preview
• AI Could Be Apple’s Next Chapter
• AI is the Best Investment Opportunity of our Lifetime: Video Interview
• Major Top or One More High
• Where the Market is Headed Next

In last week’s article, we discussed the general path the SPX will likely take into the end of the year. In brief, we are expecting volatility to continue with a test of the 4275 SPX region, then a final push to new highs, which could take us into Q1 of 2024. The current macro environment is not signaling a near-term recession in the US now, so absent of an unforeseen event, we do not see the July top as anything more than a correction.

However, markets do not move in a vacuum. There is always a market ahead of the one you are tracking, and seemingly unrelated markets often drive the very one you are most exposed to. Our portfolio management discipline is to track various key markets, as it’s quite evident that tangential markets are inter-related. When doing so, the picture that emerges is not one that supports an uninterrupted bull market.

The two most important markets that are driving the S&P 500 is oil and the US dollar. Both are suggesting a continuation of the equity rally for another leg higher, but then the also suggest a return to volatility over a longer time horizon. In this article, we will examine the levels that must hold, as well as introduce the important supporting markets to track right now so that one can maneuver any further upside in the markets as well as the coming volatility that may follow.

Growth, Inflation and Recessions

Markets do not crash randomly. They crash as a result of economic growth decelerating below expectations, which simply cannot support equity valuations at the time. With the FED wrapping up one of the most aggressive rate hike campaigns in modern market history, investors are now left wondering if those rate hikes will filter into the economy enough to cause an unexpected decline in economic growth. We believe the lag effect on these rate hikes is giving the illusion of safety, with the effects of this campaign most likely to show up in late Q4 of 2023 – Q1 of 2024. When economic growth decelerates too much, that is usually the environment that we see deep market declines.

That being said, investors betting on a crash now will likely be disappointed. If we examine the trend in US growth, there is simply no evidence of an impending recession. The below graph looks at the 3-month annualized trend in various metrics ranging from the consumer’s health to employment. Simply put, this is not what you see going into a recession, nor do they signal a recession is just over the horizon.

Furthermore, we tend to see initial unemployment claims spike relatively close to market tops. As of now, this metric is signaling that the July top is likely nothing more than a correction within a larger trend higher. Employment is not weak enough, nor is the consumer weak enough to suggest that a recession is just over the immediate horizon.

While the US economy has remained resilient for most of 2023, we have also seen a high level of disinflation, as well. While the YoY CPI numbers are still a far cry from the FED’s 2% target, coming in recently at 3.7%, the 3-month annualized trend is an encouraging step towards that goal. Keep in mind, in order to get to the YoY target, you need to see several months in a row of the 3-month annualized trend come in at, or below your target. So, this trend is encouraging.

However, when you dig under the surface of what’s driving the current level of disinflation, a concerning picture emerges. There are only three general drivers within the CPI print – energy, food, core inflation.

The 3-month annualized trend in core inflation has remained within the 4% – 5% for over a year, with our first move towards 3% – 2% in the last print two prints. While this is a move in the right direction, keep in mind that the YoY print for Core CPI is 4.3%. This is still more than double the FED’s target.

This falls in line with what market history has taught us about inflation and recessions. Once core inflation gets out of control and moves well above the FED’s target for that business cycle, it requires a recession to get it back in line. More importantly, there is no instance in modern market history where core inflation has naturally gone back to the FED’s target without the help of a recession. The last two shoes to drop in the business cycle are always employment, then inflation, which is exactly what we are seeing right now.

So, while the trend in core inflation is promising, a current YoY reading of 4.3% is still too far away from the FED’s target of 2%. This means that energy has been the primary driver of the current disinflation trend, which is obvious in the graph above. For this reason, oil prices are crucial right now in confirming what equity prices have priced in – the FED pausing further rate hikes. If oil continues higher, inflation will certainly come back, forcing the FED to continue raising higher than equity valuations are currently priced.

Oil

From its high just under $130/barrel in March of 2022, to its low just above $63/barrel on May of 2023, crude oil has seen a +50% drawdown over 14 months. This deceleration in oil caused the disinflation that equity prices are celebrating, as core inflation remained virtually unchanged during that time

However, since the May low, crude oil is up over 30%, making its first series of higher highs and higher lows in over a year. What this means for future inflation readings is that energy will actually hurt the disinflation narrative, meaning that core inflation will have to decelerate to pick up the slack. Considering the health of the consumer, coupled with the lessons in history, we find this to be unlikely.

However, it’s important for investors to understand that equities are forward looking. As oil prices broke out to a new high in early August, equities topped one week prior, causing the drawdown we are currently in. Technically, the odds favor a larger uptrend in oil prices over the coming year; however, we just completed a 5-wave pattern off the May low. What follows this pattern is usually a 3-wave retrace of the same degree.

In other words, the 5-wave uptrend took about 4 months to complete. So, I’d expect at least a 2-3-2 month retrace over the coming months. If oil gives us a proper pullback, which it seems likely, expect equities, especially tech, to continue higher. This sets us up for that final push higher into early 2024.

The US Dollar

My favorite means of tracking the US dollar (USD) is through the dollar index (DXY). This is simply an index of popular currency pairs to the USD that has a lot of price history to analyze. What is undeniable in this market is the inverse relationship between DXY and US equities.

The reason for this relationship is based on the abundance of global debt denominated in the US dollar. Some estimates claim that $12 Trillion of global debt is denominated in the US Dollar, while others have claimed its even as high as $65 Trillion. This would be debt in US dollars coming from non-US banks and shadow banks. These figures are in relation to a global GDP of $104 Trillion.

Regardless of the actual denomination, with so much global debt priced denominated in dollars, when the dollar goes up in value, compared to a country’s own currency, the cost to service this debt is also going up. This drains liquidity from that foreign economy, which is less money to spend on stocks. Adversely, the opposite is true, which is one of the reasons why we have seen such a sharp increase in US equities. As the dollar has dropped sharply from its high, global liquidity has also bottomed and slowly trended up.

If we analyze DXY, it appears to be in the final stages of the corrective rally within a larger correction. It hit the lower target around $105; however, the structure looks like it can extend towards $107 in the coming weeks.

Sign up for I/O Fund's free newsletter with gains of up to 221% – Click hereSign up for I/O Fund's free newsletter with gains of up to 221% – Click hereClick here

As long as DXY goes up, expect volatility to continue in the markets. However, what is encouraging is that once this corrective rally terminates, we should see a final leg lower in DXY, which will also support another rally in equities.

Broad Market Levels

It is our belief that we are about to start the final leg higher in equities before topping. This is supported by two of the most important markets that have a significant effect on equity prices. The catalyst for a larger top will likely be a recession. Absent of an unforeseen event, our timing of this recession is November 2023 – March of 2024. The above supporting markets also line up with this thesis – Oil and DXY should see a multi-month decline, which will support equities moving higher. However, these moves will be a correction in much larger trends.

Regarding price levels, our belief is that the broad market is in a correction, which should make another move lower into late fall/early winter. Confirmation of this move will be a break below 4430 SPX, and our targets for the last leg in this correction will be around 4275 SPX. This is laid out in the green count below.

However, I cannot ignore that the bears have, so far, been unable to take advantage of the setup pointing us lower. For this reason, I’ve added the red count to the chart, which suggests a direct push towards 4700 – 4800 SPX. If we see the market breakout above 4516 SPX, this will become my primary expectation.

The final alternative count is in blue. This will not be considered until we see a break below 4245 SPX.  If this does happen, it will make the probabilities of a major top being in, and we will risk manage accordingly. As I do not see any evidence of a recession brewing now, this blue count would likely be the market picking up on some type of event.

In conclusion, there are three broad market levels investors need to focus on in order to best risk manage their portfolios into the end of the year. We do believe that we are marching towards a recession, but that recession is not in the data now, which favors higher levels. But, based on the trends in oil and the US dollar, which are key markets driving equity returns, any additional upside should be met with caution until the macro environment changes.

Due to these dynamics, we believe the odds of a final swing higher are quite high. If we get confirmation of this move, we will target 4700 – 4800. Our plan is to trim substantially when we get to this region, and play defense until the market and economy proves otherwise. If we see a continuation of the current correction we are in, we consider it to be a buying opportunity as long as we stay above 4245 SPX. Below this level, and a major top is likely in.

What’s Next

If you want to track the potential top in equities, join I/O Fund next Thursday, September 21st at 4:30 pm EST, for our premium webinar. We will go over in detail all possible scenarios, plus the levels that need to hold that can confirm what is likely playing out. We will also go over the specific AI stocks we are targeting for this final run higher, as well as our game plan for when we confirm a top.join I/O Fund next Thursday, September 21st at 4:30 pm EST, for our premium webinar. We will go over in detail all possible scenarios, plus the levels that need to hold that can confirm what is likely playing out. We will also go over the specific AI stocks we are targeting for this final run higher, as well as our game plan for when we confirm a top.

Disclaimer: This is not financial advice. Please consult with your financial advisor in regards to any stocks you buy.

Recommended Reading:

• Major Top or One More High
• Tesla’s Margins: How Low Will They Go?
• Nvidia Stock: How We Plan To Position For Q2 Earnings
• Alphabet Stock: Search Giant Is Just Getting Started
• NASDAQ REBALANCE: WHAT YOU NEED TO KNOW
• This Next AI Trend Could be Worth Trillions

September is widely known to be the worst month for tech as it’s the only month to see negative average returns for the past decade for the Nasdaq 100. Meanwhile, the index is entering September up 42.5% YTD, setting up investors who are sitting on paper gains for potentially a large disappointment.

There are many cross currents driving the markets in 2023, which can make positioning challenging for investors right now. 

On the positive side, the economy grew at a 2.4% annualized rate in Q2, with an early projection for Q3 to be a stunning 5.8% annualized, This is accompanied with a strengthening consumer, and a resilient employment market with room to grow. If there was ever an environment for the Central Bank to pull off a soft-landing, this would be it.

On the other hand, the track record for the FOMC’s ability to pull off a soft landing is not very good. There have been previous instances where low inflation environments allowed them to rescue equities with injections of liquidity, such as the mid-1990s, 2016, 2020. However, there is no instance in market history where they were able to pull off a soft-landing in an environment with heightened inflation. This coupled with the most inverted yield curve in decades, and the Money Supply going negative for the first time since the 1930s, it makes sense to give up some additional gains in any further swing higher, just to be prepared for the coming crash.

With this many cross currents, there is no shortage of well-supported narratives. For this reason, we believe the best means to navigate the current markets is by focusing on price. If we are going to see a major pullback, this will show up in specific price patterns breaking through critical support. Until then, we believe it wise to not fight the current trend, even with the high probability of a recession manifesting within the next six months.

It is our belief that inflation will likely start surprising to the upside in the next three months. We’ve been talking about the strong economy = strong inflation theme for several months, and with energy and food prices in sustained uptrends, this theme will likely start to manifest soon. We also believe the US will enter a recession within the November 2023 to March 2024 time frame. This will cause a top in equities, which is showing up in the charts. The only question is if this top will coincide with a recession, which we will use technical analysis to help guide us.

We have a solid history of using these techniques to identify turning points. For example, between October 12 – November 9th of 2022, we put all of our cash to work in the markets. On October 12th, we timed the bottom perfectly, buying companies like NVDA at $108.October 12 – November 9th of 2022, we put all of our cash to work in the markets. On October 12th, we timed the bottom perfectly, buying companies like NVDA at $108.

Two Scenarios for Potential Tops

There are three general counts I'm tracking into Q1 of 2024. The Green count, or some variation of it, is the most likely. This suggests that we see one more swing into the 4680 – 4730 region after a drop into the 4275 region, which is likely playing out now. The red count will mimic the Green count with the possibility of a larger swing higher into Q1 of 2024. The targets here are 4890 – 5000 SPX. The Blue count has us topping. We would need to see a break below 4245 SPX for confirmation of the Blue count.

I believe that we are marching towards a recession, which will cause a top in equities. This view has become contrarian, as the consensus is now calling for a soft-landing.

Even though this is my thesis, as a portfolio manager, I cannot be too attached to a thesis and must be willing to pivot. This is the reason I put so much weight on price. It is because it is the only metric that ultimately matters, and it will be the final arbiter of what narrative will win out in this market. Price can help you pivot when you are wrong, and also confirm an unexpected scenario is starting to play out.

The reason I say this is because of the Blue count, which suggests a top has already happened. There is no evidence in the macro data suggesting a Q3 recession is underway. However, if we see price break below 4245 SPX, I'll have no choice but to make this the primary count. So, that is the ultimate bail-out for the Green and Red counts.

Sign up for I/O Fund's free newsletter with gains of up to 221% – Click hereSign up for I/O Fund's free newsletter with gains of up to 221% – Click hereClick here

If we zoom into the cyclical bull market that started in October of 2022, we can get some more clarity on where this trend can go. Let's start with the push higher that started two weeks ago. With price breaking below 4478 SPX, it appears that we are starting the next leg lower in this correction, which we have 4275 as a strong target.

In conclusion, as stated earlier, as long as this drop stays above 4245 SPX, we are expecting a push higher into Q4/Q1. This will likely set up a nice buying opportunity for those looking to capture the final swing in the large uptrend that started in October of 2022.

This is the most likely outcome, considering the resilience of the US economy, which is not in threat of going into recession right now. Also, we expect the new uptrend in energy prices to hit CPI data in October. If we start seeing a return to upside surprises in inflation data, it will likely trigger a risk-off environment for equities that is worth monitoring. We will update you as we go along.

Next week we’ll discuss the most important markets to track for a continued push higher in equities.

If you want to track the potential top in equities, join I/O Fund next Thursday, September 14th at 4:30 pm EST, for our premium webinar. We will go over in detail all possible scenarios, plus the levels that need to hold that can confirm what is likely playing out. We will also go over the specific AI stocks we are targeting for this final run higher, as well as our game plan for when we confirm a top.join I/O Fund next Thursday, September 14th at 4:30 pm EST, for our premium webinar. We will go over in detail all possible scenarios, plus the levels that need to hold that can confirm what is likely playing out. We will also go over the specific AI stocks we are targeting for this final run higher, as well as our game plan for when we confirm a top.

Disclaimer: This is not financial advice. Please consult with your financial advisor in regards to any stocks you buy.

Recommended Reading:

• Tesla’s Margins: How Low Will They Go?
• Nvidia Stock: How We Plan To Position For Q2 Earnings
• Alphabet Stock: Search Giant Is Just Getting Started
• This Next AI Trend Could be Worth Trillions