Derek Quick
Uranium/Nuclear & Value Stock Analyst, Trader, Coast Guard Veteran
The Nasdaq 100 faces up to 43% downside back to last year's lows as conditions start to look like 1973-style stagflation. A Fed hike is on the table, and AI capex is running into an energy bottleneck. After gains like SanDisk's 4,000% in a year, investors likely want to take profits. x.comÂ
The Nasdaq 100 faces short-term downside because a failed push to a new high leaves crowded bullish sentiment vulnerable to a break below. Despite record institutional accumulation and a long-term bullish position, five months of chop, a failed ATH and an attempted loss of the bullish trend favor hedging rather than adding leverage. x.com x.comÂ
Forward risks matter more than good earnings for the Nasdaq now. The index looks to be topping and has a good shot at 28,000 before a rally after the midterms; tomorrow's PCE and GDP releases are unlikely to help, and this week's lows could break. x.com x.comÂ
Bubbles rarely end when expected and tend to run much further, so the Nasdaq looks to be in a shakeout rather than at the end of its advance. Nasdaq at 40,000 or 50,000 is not out of the question in a melt-up; those who buy this dip will be greatly rewarded if positioned correctly. x.com x.comÂ
Nasdaq-100 downside could accelerate if QQQ falls below $712: dealer positioning at $700 and $690 would fuel the move unless the index reclaims its moving averages and breaks upward. July and September FOMC lows remain untouched, something that has not persisted across two consecutive meetings; taking out at least one in the next week would not be surprising. x.comÂ
Renewed inflation raises the risk of a December rate hike and downside for the Nasdaq 100. Per Wall St Engine, core PCE reached 3.1% year over year, up from 3.0%, and rose 0.3% month over month, up from 0.2% previously. CPI, PPI and PCE are all rising again; a December hike is the bet. x.comÂ
The AI supercycle is backed by real profit growth, not a bubble. Nasdaq-100 earnings-per-share growth just crossed 50%, faster than the post-GFC rebound and every expansion cycle of the last two decades, with revenue growth rising alongside it. Bubbles are built on multiple expansion and nonexistent earnings; this is an acceleration in real cash flow. x.comÂ
US stocks face a potentially bigger selloff as rising inflation compounds concerns about AI spending. PCE inflation reached a four-month high of 3.6%, increasing pressure on the Fed to raise rates; Alphabet shares fell after disappointing earnings, slowing ad growth and more than $51 billion of quarterly capital investment. x.comÂ
Disappointing Amazon earnings make a Nasdaq 100 decline to the bottom of its range near 700 look likely tomorrow. It may be forming a range like the one that preceded the decline into the March low, but a sideways phase lasting as long as that one looks unlikely. x.com x.comÂ
The Nasdaq's momentum selloff looks like a crowded AI trade unwinding into cyclicals, a washout rather than a top. Goldman's high-beta momentum index fell 24% in early July, its worst since April 2009, per @stocktalkweekly, yet the index held as money rotated rather than left, with AI names de-rating even on TSMC's beat. The real risk is financing: AI capex has outrun cash flow and runs on cheap money, debt and vendor paper, so tighter credit could stall the buildout even with strong demand. … Show more
The Nasdaq looks headed lower as the Iran war points to inflation, higher oil prices and rising yields that will force tough Fed decisions. Iran is expected to respond to Ukrainian attacks, China and Russia are acknowledging US struggles, and the Houthis and Iran are hitting regional oil infrastructure, destroying facilities that will take years to rebuild. A Fed hike is 35-40% likely, Mag 7 capex is at record highs, and the index is near support. AI and semis remain bullish longer term. x.com … Show more
