đĽ 2026 Predictions; the AI Boom; a Divided Federal Reserve (and What Comes Next)
2026 Market Outlook; 2025's Winners; Gold's Best Year Since 1979; Bitcoin's Wild Ride; and What it Means
đ Good afternoon my friend, hope youâre having a great week!! Thank you for joining 108,000 subscribers who trust this newsletter to get smarter with money, investing, and the economy. My goal is simple: Make it easy for you to connect the dots on the economy, markets, and investing (in 10 minutes or less!)
đŹ In this issue:
Part I - Markets & Economy:
1. Market Update
2. Important Finance News
3. Chart of the Day
Part II - Investing & Stocks:
4. Stock Market Ideas
5. Today's Trade
6. Fear & Greed Analysis
7. Technical AnalysisEach issue takes many hours to research and write so if you enjoy reading please support us and:
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(1) Market Update & Analysis
đ Everything You Need to Know (in 60 seconds):
Stocks closed 2025 with triple-digit gains for the third straight year. The S&P 500 rose 16-17%, the Nasdaq jumped 20-21%, and the Dow gained 13-14%. This marks only the sixth time since the 1940s weâve seen three consecutive years of double-digit returns.
AI drove everything. Seven of the top 10 S&P 500 performers rode the artificial intelligence wave. Nvidia alone accounted for 15% of the indexâs total return. Data storage stocks like Sandisk, Western Digital, and Seagate were among the yearâs biggest winners.
The Magnificent 7 now control 34.3% of the S&P 500, up from just 12.3% a decade ago. Market concentration has never been higher.
The Fed is divided. Decemberâs meeting minutes revealed three dissenting votes on the rate cut, the most significant pushback since 2019. Several officials wanted to pause. Most traders now expect no cut in January.
Precious metals had a historic year. Gold surged roughly 64-65%, its best performance since 1979. Silver rocketed over 140%, hitting $80 per ounce before pulling back. Platinum gained 146% after the EU reversed its 2035 ban on combustion engines.
Global markets joined the rally. Europeâs Stoxx 600 hit all-time highs (up 16%). The UKâs FTSE 100 had its best year since 2009. Japanâs TOPIX gained 22%, finally recovering all losses from the 1991 bubble burst.
đĄ Andrewâs Analysis & Deep Dive:
Go back twelve months. Experts predicted a recession. Inflation was sticky. Interest rates were elevated. The tariff war was escalating. Every headline screamed doom. And yet here we are, celebrating a third straight year of double-digit gains in the stock market.
During my years on Wall Street, I learned that markets donât move on facts alone. They move on fear and greed. In April, fear won. Investors panicked. Tariff announcements triggered a near-bear market. If you sold then, you missed everything that came after.
The pattern never changes: markets reward patience. Panic rarely pays.
This year proved something important about modern markets. AI isnât just a theme anymore. Itâs the engine. When you have one company (Nvidia) responsible for 15% of the entire S&P 500âs return, youâre not watching a trend. Youâre watching a structural shift in how wealth gets created.
Think about what that means. A decade ago, the Magnificent 7 made up about 12% of the index. Today? Over 34%. Weâve never seen this level of concentration. Thatâs not necessarily bad news for investors, but it does mean your âdiversifiedâ index fund isnât as diversified as you think.
The Fedâs Mixed Signals
Hereâs where things get interesting for 2026.
The December Fed minutes revealed something the headlines missed: this isnât a unified central bank anymore. Three officials voted against cutting rates. Several others were on the fence. Thatâs the most dissent since 2019.
What does this mean for you? Donât count on aggressive rate cuts in 2026. The Fed is watching inflation closely, and sticky prices mean higher borrowing costs stick around longer. Your mortgage rate, your car loan, your credit card APR, theyâre all tied to what the Fed does next.
If youâve been waiting to refinance, waiting for rates to drop, you might be waiting longer than expected.
The Gold Story Everyone Misunderstands
Gold up 64%. Silver up 140%. Platinum up 146%.
Most people think, âOh, inflation hedge.â Thatâs part of it. But hereâs the deeper story: investors are losing faith in traditional safe havens.
When the dollar drops nearly 10% in a single year, thatâs not noise. Thatâs signal. Global investors are hedging against American economic uncertainty. Between tariff policy, a changing Fed, and unprecedented government spending, the smart money is diversifying into hard assets.
During my time at Goldman, we used to say precious metals tell you what the bond market wonât. Right now, theyâre screaming that uncertainty isnât going anywhere.
Final Thoughts
2025 proved that markets reward patience over panic. 2026 will likely test that lesson again. Between a divided Fed, AI hype (and skepticism), a frozen job market, and geopolitical risks, thereâs no shortage of reasons to worry.
But thereâs also no shortage of opportunity. Stocks have room to run. Dividends provide income. Precious metals offer hedges. And AI could genuinely transform the global economy for the better.
Your job isnât to predict the future. Itâs to position yourself to win in multiple futures while protecting against the worst outcomes.
What To Do With This Information
1. Donât fight the trend, but donât ignore the risks. Three straight years of gains is historically rare. It can continue. But remember: the market gave you a 19% drawdown in April. If you couldnât stomach that, you need to reassess your risk tolerance before, not during, the next selloff.
2. Understand what you actually own. If youâre in an S&P 500 index fund, youâre making a massive bet on seven companies. Thatâs not wrong, but know what youâre doing. Consider whether some diversification into international stocks, value names, or commodities makes sense for your situation.
3. Watch the Fed, not the headlines. Forget the daily market noise. The real story for 2026 is monetary policy. If inflation stays sticky, rates stay elevated. If the labor market cracks, the Fed pivots. Your investment strategy should account for both scenarios.
4. Precious metals arenât just for doomsday preppers. A small allocation (5-15%) to gold or silver can smooth out volatility in a portfolio. This year proved that. You donât need to be a gold bug to recognize the value of diversification.
5. Cash isnât trash right now. With money market funds still yielding 4-5%, thereâs no shame in holding some dry powder. When the next drawdown comes (and it will), youâll want capital ready to deploy.
The Bigger Connection
Everything happening this year connects to one central theme: weâre in a transition period.
The AI revolution is reshaping which companies win. The Fed is navigating uncharted territory between inflation and growth. Geopolitical tensions (from tariffs to Venezuela) are creating new risks. And investors are responding by rotating into hard assets while still chasing tech gains.
This isnât a market that rewards lazy thinking. It rewards attention. It rewards patience. And it rewards those who can see beyond the headlines.
If you held through 2025âs volatility, youâre sitting on solid gains today. The question now is: what do you do next? The answer depends on your goals, your timeline, and your stomach for risk.
But hereâs what I know from two decades in finance: the investors who win long-term are the ones who stay disciplined when everyone else loses their heads.
Happy New Year. Hereâs to making smart money moves in 2026. Stay disciplined. Stay diversified. And stay subscribed. Iâll keep breaking this down for you every week.
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(2) Important Finance News
In this issue we analyze:
(1) Wall Street's 2026 Predictions
(2) The Magnificent 7, the New Challengers, and the Dogs of the Dow
(3) A Divided Federal Reserve
(4) The "Jobless Boom" Paradox
(5) Bitcoinâs Wild Ride Continuesđ¤ But first, how are you feeling about 2026?
1ď¸âŁ Wall Streetâs 2026 Predictions
Major investment banks have released their 2026 forecasts, and the spread tells you everything about current market uncertainty.
The bull case: Oppenheimer sees the S&P 500 reaching 8,100 by year-end, roughly 18% higher from current levels. Their thesis? AI momentum continues, corporate earnings stay strong, and the Fed keeps cutting.
The bear case: Stifel Nicolaus expects the index to finish at 7,000, just a 2% gain. Theyâre worried about valuation and macro headwinds.
The middle ground: JPMorgan targets 7,500 (up 9%), while Morgan Stanley and UBS land around 7,700-7,800 (up 12-14%).
Hereâs what actually matters: every single one of these forecasts assumes no major surprises. Last yearâs tariff shock, the Venezuela situation, even Fed pivots, none of that was in anyoneâs models.
When I worked at JP Morgan, we had a saying: forecasts are useful for understanding assumptions, not predicting outcomes. The real value here is seeing what Wall Street thinks drives returns (AI, earnings, rate cuts) and stress-testing whether you agree.
My advice: Donât invest based on price targets. Invest based on fundamentals you understand. If AI growth stalls or inflation surges, these numbers mean nothing.
2ď¸âŁ The Magnificent 7, the New Challengers, and the Dogs of the Dow
The Magnificent 7 Report Card: Winners and Losers
Not all Mag 7 stocks are created equal. Hereâs how they performed this year:
The winners:
Alphabet: +65.8% (Gemini 3 Pro changed the narrative)
Nvidia: +39.65% (still the AI king)
Microsoft: +15.67% (Azure growth, $80B AI spend)
The middle pack:
Meta: +13.75% (strong ads, but AI spending concerns)
Tesla: +12.48% (wild year, EV headwinds, Musk drama)
The laggards:
Apple: +9.02% (slower AI rollout, iPhone 17 focus)
Amazon: +5.99% (cloud profits, but high capex and regulatory pressure)
The spread between Alphabet (+66%) and Amazon (+6%) shows something important: the AI trade isnât monolithic. You canât just buy âtechâ and expect uniform returns. Stock selection matters.
During my decade on Wall Street, I watched countless investors chase themes without understanding individual companies. The winners in 2026 will be those who dig deeper than headlines.
My advice: If youâre betting on AI, know which horse youâre riding. Nvidia and Alphabet executed. Others face real questions about monetization.
The Rising Challengers: Beyond the Mag 7
This year quietly belonged to some non-Mag 7 tech names that deserve attention:
Broadcom doubled its stock price, cementing itself as Nvidiaâs most credible competitor. Custom chip partnerships with Google, Anthropic, and OpenAI drove the surge.
AMD rose 78% after landing a massive deal to supply GPUs to OpenAI, potentially adding $4.5 billion in quarterly revenue by late 2026. OpenAI even got warrants to acquire up to 10% of AMD.
Intel staged a surprise comeback (+86%) after a chaotic year. A new CEO, government backing, and Nvidia becoming a strategic investor saved the stock from oblivion.
Palantir doubled again (up 139%) on explosive AI platform adoption. But hereâs the warning: shares are up 2,700% since early 2023 while revenue grew just 104%. Valuation matters eventually.
The lesson: Market leadership changes. The Mag 7 may not dominate forever. The companies building picks-and-shovels for the AI revolution (chips, infrastructure, data) are worth watching.
Dogs of the Dow: Dividend Investingâs Best Year Since 2019
Sometimes boring wins.
The 10 highest-yielding Dow stocks (the âDogs of the Dowâ) returned an average of 17.8% this year, beating the broader Dowâs 14.5% gain. IBM, Cisco, Amgen, and Johnson & Johnson each gained 28-44%.
Why this matters: With rate cuts potentially continuing, dividend stocks become more attractive. When Treasury yields drop, investors hunt for income elsewhere. The Dogs historically outperform in falling-rate environments.
The 2026 lineup shifts: Nike, UnitedHealth, and Home Depot replace IBM, Cisco, and McDonaldâs based on current yields. Verizon (6.7% yield) and Chevron (4.6%) remain the income leaders.
My advice: Donât sleep on dividend investing. In a world of uncertainty, getting paid while you wait has real value. Verizon trading at 8.5x earnings with a 6.7% yield deserves a look.
3ď¸âŁ A Divided Federal Reserve
The Fedâs December meeting showed deeper divisions than expected.
Three officials dissented from the rate cut (the most since 2019). Several others said they could have supported a pause. The updated language signals a higher bar for additional cuts.
Translation: Donât assume rate cuts are automatic. The Fed is genuinely torn between fighting sticky inflation and supporting growth.
Hereâs the number that matters: 85% probability of no cut in January, according to CME FedWatch. And March is basically a coin flip.
The wild card: Jerome Powellâs term ends in May. President Trump wants lower rates (inflationary) while also worrying about cost of living (which lower rates worsen). The next Fed chair matters enormously.
My advice: Build your financial plan assuming rates stay elevated longer. That means: pay down high-interest debt, lock in fixed rates where possible, and donât bank on cheap money returning soon.
4ď¸âŁ The âJobless Boomâ Paradox
The economy is growing, but hiring isnât.
GDP hit 4.3% in Q3, the strongest since Q3 2023. Consumer spending remains strong. Yet unemployment sits at 4.6% (highest since 2021), and job seekers describe finding work as âimpossible.â
Whatâs happening: Companies are doing more with less. AI investment is driving growth without creating jobs. Profit margins face pressure from tariffs, so businesses cut headcount instead. Many firms over-hired during the pandemic and are now correcting.
This âjobless boomâ may define 2026. The economy expands, stocks rise, but the labor market stays frozen.
Why it matters for you: Job security isnât what it used to be. Even in a growing economy, layoffs continue in white-collar sectors. Build your emergency fund, diversify your income streams if possible, and keep your skills sharp.
The uncomfortable truth: AI might accelerate this trend. If companies prove they can grow profits without hiring, expect more of the same.
5ď¸âŁ Bitcoinâs Wild Ride Continues
Bitcoin started 2025 hot, riding Trumpâs election victory to break $100,000 for the first time. The president even launched his own memecoin. Regulatory wins followed: the strategic bitcoin reserve, the GENIUS Act, friendlier SEC treatment.
Then reality hit. Aprilâs tariff fears pushed bitcoin to $76,000. Bitcoin spent months bouncing above and below $100,000. Goldâs monster year stole the âsafe havenâ narrative.
Where we ended: Bitcoin peaked around $126,000 in October, sitting near $87,000 now. Still a solid year, but not the rocket ship bulls predicted.
Wall Streetâs 2026 forecasts:
Standard Chartered: $150,000 (cut from $300,000)
Bernstein: $150,000, peaking near $200,000 in 2027
JPMorgan: $170,000
Ripple CEO: $180,000
The real story: Crypto took major strides toward legitimacy. ETFs exploded. Banks entered the space. Regulation improved. But volatility isnât going anywhere.
My advice: Size your position accordingly. If 30-50% drawdowns keep you up at night, youâre overexposed.
đĄ Andrewâs Analysis:
Every story above connects to three big themes:
1. AI is the new oil. Itâs driving stock returns, reshaping job markets, and attracting unprecedented investment. But monetization remains unproven, and bubbles form around unproven technologies. Stay invested but stay skeptical.
2. Uncertainty is the new normal. Divided Fed, tariff risks, geopolitical shocks, crypto volatility, job market freeze. Thereâs no stable equilibrium right now. Your financial strategy needs to account for multiple scenarios.
3. Income and hard assets are back. Dividend stocks had their best year since 2019. Gold and silver had their best year since 1979. When uncertainty rises, proven income streams and tangible value matter.
My advice: Build a portfolio that can handle multiple futures. Some growth exposure for the AI upside. Some dividend stocks for income and stability. Some precious metals or alternatives for hedging. And cash on the sidelines for opportunities.
If you listened when I talked about staying patient through volatility, youâre up double digits this year. The same discipline applies going forward.
The investors who win arenât the ones who predict the future correctly. Theyâre the ones who prepare for multiple futures and stay disciplined when headlines get scary.
đ For daily insights, follow me on X/ Twitter, Instagram Threads, or BlueSky, and turn on notifications!
(3) Chart of the Day
The Three Paths to 2050: Why This Chart Should Terrify and Excite You
đĄ Andrewâs Analysis & Deep Dive:
Todayâs chart comes from the Federal Reserve Bank of Dallas, and it might be the most important visual you see all year.
It shows five possible paths for GDP per capita between now and 2050, depending on how artificial intelligence develops. Let me break down what youâre seeing:
The blue line shows actual historical GDP per capita (adjusted to 1990 dollars) from 1870 to today. Notice the steady upward trend, interrupted only by major shocks like the Great Depression and World War II.
The orange line is the baseline: 1.9% annual growth, what weâd expect without major technological disruption. Boring, but predictable.
The green line shows what happens if AI boosts growth to 2.1% for the next decade. That small difference compounds into meaningfully higher living standards by 2050.
The red line is the âbenign singularityâ scenario. If AI achieves true general intelligence and remains friendly, economic growth goes vertical. GDP per capita shoots toward $128,000 (in 1990 dollars) and beyond.
The purple line is the nightmare scenario. Malevolent AI leads to human extinction. GDP goes to zero.
Why This Matters For Your Money
This isnât science fiction. These are scenarios serious economists at the Dallas Fed are modeling.
Hereâs the investing framework Iâd take from this:
If you believe AI is transformative (green or red line): You want exposure to the companies building this future. Nvidia, Broadcom, AMD, the cloud giants, the data infrastructure plays. But you also want diversification because nobody knows which companies will win long-term.
If youâre skeptical (orange line): Traditional portfolio allocation still works. Diversify across asset classes, collect dividends, focus on value investing, and let compound interest do its thing over decades.
If youâre worried about downside (purple line): This is where gold, real assets, and non-correlated investments matter. Even if AI doesnât turn malevolent, plenty of paths lead to economic disruption.
The Jobless Boom Connection
Remember the jobless boom story (from Section 2, Part 4, above)? This chart explains why it might continue.
The green line assumes AI boosts productivity enough to grow the economy 2.1% annually instead of 1.9%. But that productivity gain can come without hiring more workers. Companies could produce more with the same (or fewer) employees.
Thatâs already happening. GDP hit 4.3% last quarter while unemployment rose. If AI accelerates this trend, we could see a decade of economic growth that doesnât translate into broad job creation.
What this means: Your career planning needs to account for this possibility. Jobs that involve routine tasks (even white-collar ones) face increasing automation pressure. Jobs that require judgment, creativity, and human connection have more staying power.
Wealth-Building Advice
During my years in finance, Iâve watched technology reshape entire industries. The internet boom. The smartphone revolution. Now AI. Each time, fortunes were made by those who invested early, and fortunes were lost by those who chased hype too late.
Hereâs my advice:
1. Donât bet everything on one scenario. Even the experts donât know which line weâre following. Diversify your investments across multiple possible futures.
2. Stay invested, but stay humble. The green line scenario would be fantastic for equity investors. But the path between here and there will include volatility, corrections, and unexpected shocks.
3. Invest in yourself. Whatever happens to AI, your skills and adaptability matter. The workers who thrive in any scenario are the ones who keep learning.
4. Time horizon matters. This chart goes to 2050. If youâre investing for retirement decades away, you can afford to ride out short-term volatility. If you need money in five years, you need more stability.
Final thoughts
Weâre living through one of the most significant technological transitions in human history. Thatâs not hype. Itâs what the data shows.
The question isnât whether AI will change the economy. It will. The question is how much, how fast, and whether weâre prepared.
This chart should make you think carefully about your financial future. Not to scare you. But to motivate you to build a plan that works across multiple scenarios.
Because hereâs what I know after two decades in this business: the future is unknowable, but preparation isnât optional.
The investors who win arenât the ones who guess right. Theyâre the ones who prepare for uncertainty and stay disciplined when the world gets weird.
And by any measure, the world is about to get weirder.
đ For daily insights, follow me on X/ Twitter, Instagram Threads, or BlueSky, and turn on notifications!
(4) Stock Market Ideas
Top Performing Stocks:
1. Vanda Pharmaceuticals $VNDA up +25% on Tuesday 12/31
2. Sable Offshore $SOC up +19% on Friday 1/2
3. Praxis Precision Medicines $PRAX up +13% on Monday 12/29
4. Baidu $BIDU up +13% on Friday 1/2
5. Sandisk $SNDK up +11% on Friday 1/2
6. Vertiv $VRT up +8% on Friday 1/2
7. ASML $ASML up +8% on Friday 1/21) Vanda Pharmaceuticals $VNDA up +25% on Tuesday 12/31
Vanda Pharmaceuticals surged 25% after the FDA approved tradipitant, a drug designed to treat vomiting caused by motion sickness. This is a significant win for the biopharma company, which develops treatments for nervous system disorders.
FDA approvals are game-changers for small-cap pharma stocks because they transform years of research into actual revenue. Motion sickness affects millions of travelers worldwide, creating a sizable market opportunity. If youâve been following my coverage of biotech, you know these binary events (approval or rejection) create massive moves. This approval validates Vandaâs pipeline and could attract institutional interest.
2) Sable Offshore $SOC up +19% on Friday 1/2
Sable Offshore jumped nearly 19% after a federal court denied a stay requested by environmental groups trying to halt the restart of the companyâs Las Flores pipelines in California. Sable is an oil and gas company focused on reviving dormant offshore production.
This court ruling removes a major regulatory overhang and clears the path for Sable to begin pumping oil. While litigation continues, the denial signals the company can move forward with operations. Energy stocks tend to rally when regulatory uncertainty lifts. With oil prices climbing on geopolitical concerns, Sable now has both legal tailwinds and favorable commodity prices working in its favor.
3) Praxis Precision Medicines $PRAX up +13% on Monday 12/29
Praxis Precision Medicines gained 13% after BTIG named it a top pick for 2026 and raised its price target to $843 from $507, implying over 213% upside. Praxis is a clinical-stage biotech developing treatments for neurological disorders.
Analyst upgrades with triple-digit upside targets tend to attract momentum traders. The company is still pre-revenue, so this is a high-risk, high-reward play. During my years on Wall Street, I saw countless biotech stocks move on analyst conviction alone. The key question: can they execute on their pipeline? If BTIGâs thesis plays out, early investors could see substantial gains.
4) Baidu $BIDU up +13% on Friday 1/2
Baidu, Chinaâs largest search engine and AI company, jumped 13% after announcing plans to spin off its semiconductor unit, Kunlunxin, and list it on the Hong Kong exchange.
Spin-offs unlock hidden value by letting the market price each business separately. Kunlunxin makes AI chips, putting it at the center of Chinaâs tech independence push. With U.S. export restrictions limiting access to Nvidia chips, domestic Chinese chipmakers are seeing massive demand. This move positions Baidu to capitalize on both AI software (through its search and cloud business) and AI hardware (through Kunlunxin). The stock now trades near its 52-week high.
5) Sandisk $SNDK up +11% on Friday 1/2
Sandisk rose 11% as the new year kicked off, building on a monster 2025 that saw shares climb nearly 560%. The company, spun off from Western Digital in February, makes flash memory products for data centers and consumer electronics.
AI is driving insatiable demand for data storage. Every AI model needs massive amounts of data, and that data lives on storage drives. Sandiskâs addition to the S&P 500 in November brought institutional buying. If you listened when I talked about the AI picks-and-shovels trade last year, you understand why data storage companies are winning. The AI boom needs more than chips. It needs places to put all that information.
6) Vertiv $VRT up +8% on Friday 1/2
Vertiv gained 8% after Barclays upgraded the stock to overweight, citing recent volatility as creating an attractive entry point. Vertiv provides critical infrastructure for data centers, including power management and cooling systems.
You canât run AI without keeping servers cool and powered. As hyperscalers (Amazon, Microsoft, Google) pour billions into AI data centers, Vertiv supplies the picks and shovels. Barclays believes upside to earnings estimates will drive further gains. During my decade in finance, Iâve seen infrastructure plays consistently outperform when a technology buildout is underway. Vertiv is a pure play on AI infrastructure spending.
7) ASML $ASML up +8% on Friday 1/2
ASML popped 8% to start the year, building on a 54% advance in 2025. No specific catalyst was announced, but momentum carried the stock higher. ASML is the only company in the world that makes the extreme ultraviolet (EUV) lithography machines needed to manufacture the most advanced chips.
ASML is a monopoly in the most important equipment for chipmaking. Every semiconductor company, from Nvidia to Intel to TSMC, depends on ASMLâs machines. This is one of those rare stocks where the competitive moat is nearly impossible to breach. The AI chip race requires cutting-edge manufacturing, and that manufacturing requires ASML.
đĄ Andrewâs Analysis:
Three themes dominated this weekâs biggest movers:
1. AI Infrastructure Keeps Winning
Sandisk, Vertiv, ASML, and Baidu all benefited from AI-related tailwinds. The trade isnât just about Nvidia anymore. Data storage, cooling systems, lithography machines, and Chinese AI chips are all part of the ecosystem. The smartest investors look beyond the obvious plays. Who supplies the suppliers? Who benefits when the hyperscalers spend billions?
2. Regulatory and Policy Catalysts Create Instant Moves
Sable Offshore jumped on a court ruling. Vanda surged on FDA approval. In todayâs market, headlines create opportunities. These arenât random moves. Theyâre the market repricing assets as uncertainty lifts. If youâre waiting for âthe perfect entry,â youâll miss these catalysts. The prepared investor already has watchlists ready.
3. Analyst Upgrades Still Matter (For Momentum)
Praxis, and Vertiv all moved on analyst commentary. Wall Street research isnât gospel, but it influences flows. When institutions get bullish, they put money to work. That buying pressure pushes prices higher, at least in the short term. The question is whether fundamentals justify the optimism.
The Lesson
Donât chase yesterdayâs winners. Use this analysis to understand why stocks moved. Then ask yourself: are these trends continuing or fading?
AI infrastructure spending isnât slowing. Regulatory battles create both risk and opportunity. And analyst sentiment shapes short-term momentum.
Build your watchlist accordingly. The best investors arenât surprised by moves. Theyâre prepared for them.
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(5) Todayâs Trade
Patterson-UTI Energy $PTEN: Bullish Call Spread Signals Confidence
The Setup: Call volume on Patterson-UTI Energy spiked to 5,091 contracts, 100 times the average volume and 500 times the put volume. That 500:1 call-to-put ratio is extreme. Traders targeted the January 16th, 2026 expiration, focusing on the $6 and $7 strike calls.
The Trade: Someone bought 2,500 call spreads (5,000 total contracts) in a single block transaction. They paid $0.30 for the $6/$7 call spread when the market was $0.15 to $0.40. This appears to be a roll-down, where traders moved their long calls from the $7 strike to the $6 strike, adding more directional risk (delta) to their positions.
Whatâs Happening: Patterson-UTI provides drilling and completion services to oil and gas companies. Shares rallied above their 200-day moving average this week and continued climbing Friday. Energy stocks have caught a bid as oil prices rise on geopolitical tensions (including the Venezuela situation).
My Take: Iâm bullish on this trade. Rolling down a call position adds conviction. These traders arenât just holding; theyâre increasing their bullish exposure. The break above the 200-day moving average is technically significant. Energy has been out of favor, but oil prices are climbing and domestic producers benefit from âAmerica firstâ energy policies. A $0.30 risk for a potential $0.70 reward (max profit at $7) offers favorable odds. Patterson-UTI wonât make headlines like Nvidia, but it could quietly deliver solid returns if oil continues higher.
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(6) Fear & Greed Analysis
Neutral trend (mixed), and improving. The Fear & Greed Index is 45 (neutral), up from 44 the prior close, and way up from 23 a month ago.
Hereâs the point: neutral is underrated. Extreme greed is when people overpay. Extreme fear is when people sell good assets at bad prices. Neutral is when the market is calm enough for real investing to work.
What it means long term: the index moving from the low 20s last month to the mid 40s now says the market mood is healing, not euphoric. That often supports a grind higher, but it also means you should stop waiting for âperfectâ prices. The best investors donât need perfect. They need consistent.
What to do (simple system):
If the index is 0 to 25, you add (slowly, on a schedule).
If the index is 75 to 100, you trim risk (rebalance, take some chips off).
At 45, you stick to plan: keep buying quality, keep cash for dips, donât force hero trades.
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(7) Technical Analysis
1) S&P 500 SPY 0.00%â
Positive trend. The S&P 500 is in a rising short-term channel. That says buyers still show up on dips, but the market is close enough to resistance that upside can slow.
A market driven by AI optimism and Fed-cut hopes can keep rising, but itâs also sensitive to inflation prints, Fed messaging, and tariff headlines.
2) Tech Stocks QQQ 0.00%â
Positive trend. The Nasdaq-100 is in a rising short-term channel and is testing support. If it holds, you often see a bounce because buyers defend the trend. If it breaks, it can turn into a quick slide because tech is crowded.
Nasdaq is the purest âAI tradeâ index. Thatâs great when the story is hot. Itâs dangerous when rate expectations shift.
3) Bitcoin $BTC
Neutral-to-positive trend, with breakout levels. Bitcoin broke up from a short-term sideways range and is now between support near 88,000 and resistance near 93,400. RSI rising can hint that momentum is rebuilding, but the range levels matter more than any single indicator.
Crypto still trades like a high-beta asset. It loves falling rates and risk-on mood. It hates uncertainty spikes.
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đFinal Thoughts:
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Lots of great insights and wisdom in this post.