NDX Blow Off

The only other times when the tech sector has surged over 4% while overall stocks declined were at the onset and in the middle of the Tech Bust---April 2000 and March 2001.

The largest single-day market cap gains in U.S. stock market history:

1. APPL Nov 2022 $191B
2. AMZN Fed 2022 $184B
3. NVDA May 2023 $179B
4. APPL Jan 2022 $150B
5. MSFT Mar 2020 $144B
6. TSLA Jan 2022

10-year returns

1. NVDA 10,519%
2. AMD 4,342%
3. TSLA 2,756%
4. NFLX 1,010%
5. META 985%
6. APPL 984%
7. MSFT 846%
8. ADBE 816%
9. AMZN 779%
10. GOOG 467%

Riding big theses is an art. Most tend to get involved at a late stage.

“I bought $6 billion worth of tech stocks, and in six weeks I had lost $3 billion in that one play. You asked me what I learned. I didn’t learn anything. I already knew that I wasn’t supposed to do that. I was just an emotional basketcase and I couldn’t help myself. So maybe I learned to not do it again, but I already knew that.”
-Stanley Druckenmiller and his late Dot.com era trade.

The 3 month performance spread between the SPX and the SPX equal-weight is the widest it has been since December 1999….

When Stanley chased.

Most people underestimated the Dot.Com momentum back in 1999. Most managed losing tons of money, first shorting the hype, later chasing it before it all reversed and crashed. If AI is just another hype or not we leave you to decide. But one thing is sure, most people underestimate all big narratives and trends tend to go on for much more than most think possible.

Even if the AI narrative is real, there is one thing a market can’t do which is sit on a spike.

There is lots of time to get on this train in the years to come if it is real.

I don’t think this is the time to chase.

Today, the QQQ will hit our 348 projection having crossed 340 with authority Friday.

The NDX at 14,400 squares the end of May. We’re there.

Related links:

The new bull market in stocks has begun as history shows ...

The Dow Is Officially in a Bear Market. Here's What to Know.