đ„ AI Bubbles, Gold & Silver's Surge, and the Crashing Dollar Explained
EXPLAINED: The truth about the Tech bubble; Why the Dollar is crashing; Why gold and silver are soaring
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đŹ In todayâs issue, weâll discuss:
Part I - Markets & Economy:
1. Market Update & Analysis
2. The Most Important Finance News
3. Chart of the Day
Part II - Investing & Stocks:
4. Stocks to Watch
5. Today's Trade
6. Fear & Greed Analysis
7. Technical AnalysisEach issue takes us few days 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:
Stocks drift higher near all-time highs as the S&P 500 rises for a third straight day, helped by a big upside surprise in Q3 GDP at 4.3% growth vs 3% expected, the strongest in two years.
The market is entering the âSanta Claus rallyâ window: the last 5 trading days of December and the first 2 of January, a period that has historically been positive most years.
Bank of Americaâs Bull & Bear Indicator is in âExtreme Bullishâ territory, which in the past often led to a pullback over the next 1â2 months.
Gold and silver both hit fresh all-time highs, as geopolitical tension and rate-cut hopes push investors toward safe havens.
Global markets join the party: Canadaâs TSX, Europeâs Stoxx 600, and the UKâs FTSE 100 either hit record highs.
đĄ Andrewâs Analysis:
This market strength is masking some serious cracks.
When I worked on Wall Street, weâd look past the headline numbers to see whatâs really driving growth. Right now, AI spending is propping up the entire economy. Strip out the $500 billion tech companies are pouring into data centers and AI infrastructure, and GDP wouldâve only risen 1.5% instead of 2.1% through nine months of 2025.
Think about that. Weâre one AI slowdown away from a dramatically different economy.
The Santa Claus rally sounds great, but Bank of Americaâs warning matters. Extreme optimism is a contrarian indicator. When everyoneâs bullish, thereâs nobody left to buy. Markets need skeptics to keep climbing.
The economy has 3 pillars right now: 1) consumer spending (which drove that 4.3% GDP), 2) AI investment, and 3) safe-haven flows into gold and silver.
Pillar 1: Consumer spending looks strong on paper, but dig deeper and youâll see it was juiced by people rushing to buy electric vehicles before tax credits expired September 30. Thatâs not sustainable growth, thatâs pull-forward demand. Consumer confidence just hit its lowest level since April.
Pillar 2: AI spending is keeping us afloat, but as Fed governor Christopher Waller pointed out, it could be masking a spending slowdown everywhere else. About half of AI deals are financed with leveraged debt. If those projects fail, banks get hurt, and when banks hurt, we all hurt.
Pillar 3: Gold and silver surging to records isnât just about geopolitics. Itâs about investors losing faith in traditional assets. When gold outperforms Bitcoin (which barely moved this year), youâre seeing a flight to true safety.
My advice: Donât chase the Santa rally blindly. Use this strength to rebalance. If youâre overweight tech because of AI gains, take some profits. Build positions in assets that benefit from the trends weâre seeing: commodities (gold, silver, copper), quality dividend stocks that can weather a slowdown, and keep cash ready for opportunities when that Bull & Bear Indicator proves right.
The big pattern connecting these events? Weâre in a K-shaped market. Higher-income households with stock portfolios are doing great (hence the rally). Lower and middle-income families are struggling with affordability. Large corporations are investing in AI. Small businesses are getting crushed by tariffs.
This divergence canât last forever. When it resolves, you want to be positioned for either outcome.
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(2) The Most Important Finance News
In this issue we analyze:
(1) Metals Mania: Gold, Silver, and Copper Hit Record Highs
(2) AI Bubble or Revolution?
(3) The Dollar's Rough Year Will Get Rougher
(4) U.S. Q3 GDP At 4.3%: Strong, But Weirdđ€ But first, how are you feeling about the markets?
1ïžâŁ Metals Mania: Gold, Silver, and Copper Hit Record Highs
Gold, silver, and copper all smashed through record highs this week, with silver skyrocketing past $70 per ounce for the first time ever. Gold futures topped $4,500, copper broke $12,000 per ton, and silverâs now the third-largest asset in the world by market cap, surpassing Apple.
Hereâs what makes 2025 different: this isnât just one metal having a moment. When multiple commodities rally together, it signals something bigger.
Goldâs 73% gain this year came from a perfect storm: central banks (especially China) buying like crazy, ETF inflows surging, the dollar weakening, and geopolitical chaos from tariffs to tensions with Venezuela. JPMorgan sees gold hitting $5,000 by late 2027. Goldman Sachs predicts $4,900 by next December.
Silverâs 145% explosion destroyed goldâs performance. India, the worldâs largest silver consumer, drove demand through seasonal Diwali buying. But the real story is industrial demand for solar panels and renewable energy. Silverâs not just a safe haven anymore, itâs a critical material for the green energy transition. Analysts see $70 as a new floor, with targets ranging from $70 to $97.85 by late 2026.
Copperâs 38% climb reflects the electrification megatrend. Companies are front-running potential 15% tariffs in 2027, causing US refined copper imports to surge 650,000 tons this year. Citi forecasts copper hitting $15,000 per ton by Q2 2026, driven by electric vehicles, grid upgrades, and data centers.
Long-term significance: Weâre witnessing a fundamental shift in what investors trust. When gold outperforms Bitcoin (which barely moved), it tells you people want tangible assets, not digital promises. When silverâs industrial demand rivals its investment demand, youâre seeing the real economyâs needs, not just speculation.
The pattern? Commodities thrive when paper assets look vulnerable. Thatâs where we are.
Two big ideas here:
This is not only fear. It is also a growth story.
Gold and silver ride safe-haven flows: Venezuela tension, Middle East risk, Russia, and worries about a second wave of inflation.
Copper rides long-term spending on electrification and AI infrastructure. That is productive investment.
We are in the early innings of a longer commodity cycle.
We saw a version of this in the 1970s. Real assets ran during high inflation, messy geopolitics, and big government deficits.
My advice:
If you own no metals at all, consider a small allocation to a gold or silver ETF or a diversified commodity fund, maybe 5â15% of your investable assets, not more.
If you already hold a lot of metals, set rules: decide in advance at what price or allocation you will trim. Parabolic charts look great until they do not.
For stock pickers, look at âpicks and shovelsâ plays: miners with low costs and strong balance sheets, copper producers, and companies that supply the metal value chain.
Mental model: own some assets that benefit if paper money keeps losing trust.
2ïžâŁ AI Bubble or Revolution?
The AI investment thesis has entered a fascinating phase where every single risk gets reframed as bullish.
Stock valuations too high? Wrong. Nvidia trades at just 23 times earnings (Cisco traded at 140 times before the dot-com crash). When you factor in 50% sales growth, Nvidiaâs actually undervalued.
Demand wonât materialize? OpenAIâs ChatGPT just hit 800 million weekly users, a record.
Data centers overbuilt? Great news. Local officials are already capping growth, which acts as a âhealthy natural governorâ preventing excess.
Too much spending? Those tech giants were just letting cash collect dust anyway. Now theyâre spending two-thirds of cash flow on AI to survive the revolution.
Will AI make money? It comes down to monetization through advertising, likely from OpenAI in early 2026.
Hereâs the uncomfortable truth: this is exactly how bubbles talk themselves into existence. Every concern gets dismissed. Every weakness becomes strength. The narrative becomes unfalsifiable.
That doesnât mean AI is a bubble, but it means weâre in the euphoria phase where skepticism disappears.
The big risk nobodyâs discussing: OpenAIâs $1.4 trillion in spending commitments over eight years. Companies like Oracle (with up to $300 billion in cloud agreements), Nvidia, Broadcom, AMD, and CoreWeave are banking on OpenAIâs success. If OpenAI stumbles, the entire AI rally wobbles.
Fed governor Waller pointed out that AI spending could be masking economic weakness everywhere else. Without the $500 billion in AI-related capital expenditures, weâd be close to recession.
Long-term implications: Weâre watching the infrastructure layer (chips, cloud, data centers) print money while the application layer (Adobe, Salesforce, Workday) struggles to show AIâs value. Thatâs normal early in a technology revolution. But it also means the companies profiting now might not be the ultimate winners.
Remember the internet boom? Cisco and Sun Microsystems (infrastructure players) soared, then collapsed. Google and Amazon (application players) arrived later and dominated.
The common thread with the metals story? Money is chasing safety (gold) and infrastructure for the future (AI, copper, silver). Both canât be right forever.
The bulls say:
High capex is good, because it builds the rails of the next economy.
Demand is real: ChatGPT usage keeps setting records.
Winners are the infrastructure players: chips, cloud, data centers, and key software tools that sit close to OpenAI and other frontier labs.
The risk story:
If OpenAI stumbles, many of those âkingmakerâ stocks could see estimates cut.
A large part of GDP growth this year came from AI and related capex. That is great while the money flows. It is painful if projects fail or funding dries up.
The Fed now has to guess how much of the âstrong economyâ is AI spend and how much is real broad demand.
Throughout history, the biggest mistakes came when people said, âThis time is different, so valuation does not matter.â That line always shows up around big new tech shifts.
My advice:
a) Separate story from cash flow
Focus on AI names that already show real revenue and customer adoption, not pure promises.
Favor companies that sell the âpicks and shovelsâ of AI: chips, networking, cloud capacity, and monitoring tools.
b) Use a simple risk system
Cap your AI and high-growth tech at a fixed share of your portfolio, maybe 30â50%.
Inside that bucket, mix leaders (Nvidia, large cloud providers) with a few calculated smaller bets.
Review quarterly: if prices run far ahead of earnings, take some profit, not all.
c) Invest in yourself
AI will shape jobs, not just stock prices. Advice:
Learn how AI tools can speed up your own work.
Build at least one small project or workflow that uses AI in your career or business. That is the personal âcapexâ that compounds.
3ïžâŁ The Dollarâs Rough Year Will Get Rougher
The US dollar is headed for its worst annual performance since 2017, down 8.2% year-to-date against other major currencies.
This matters more than most people think.
A weaker dollar makes American companies more competitive abroad (Trumpâs goal), but it also signals investor concerns about US fiscal policy and ballooning debt. Money is flowing out of dollar-denominated assets.
Markets are now pricing in two more Fed rate cuts for 2026, which puts more downward pressure on the greenback. Morgan Stanley expects âa choppy path over the next 12 months, with continued weakening in the coming months followed by a recovery and an end to the dollarâs bear market in the second half of 2026.â
A weaker dollar has mixed effects:
Good for U.S. exporters and multinationals, since their goods look cheaper abroad and foreign profits translate back into more dollars.
Tough for importers and U.S. consumers, since many goods and commodities are priced in dollars and can cost more.
Helpful for emerging markets and foreign borrowers that owe dollar debt, at least for now.
Hereâs the big picture: When gold hits records, silver surges, and the dollar tanks simultaneously, youâre witnessing a loss of confidence in fiat currency. Not collapse, but concern.
Long-term significance: For decades, holding dollars meant holding the worldâs safest asset. Thatâs changing. Central banks are diversifying (hence the gold buying). Investors are hedging (hence the metal rallies). And Americaâs $36 trillion debt makes this trend hard to reverse.
My advice: If youâre 100% in US stocks and bonds, you have dollar concentration risk. Diversify your currency exposure through international stocks, commodities priced in dollars (they rise as the dollar falls), or even holding some cash in foreign currencies through ETFs.
Think of it like this: You wouldnât put your entire portfolio in one stock. Why put it all in one currency?
The pattern connecting to our other stories? Everything points to diversification away from traditional US assets. Metals up, dollar down, investors questioning whether old assumptions still hold.
A simple rule: own things that benefit if your home currency loses some power.
4ïžâŁ U.S. Q3 GDP At 4.3%: Strong, But Weird
US Q3 GDP grew 4.3%, crushing the 3.2% estimate and marking the strongest quarterly growth in two years.
Sounds fantastic, right? Hereâs what the headlines missed.
Consumer spending drove the gain, rising 3.5% versus 2.5% in Q2. But that spike came from people rushing to buy electric vehicles before tax credits expired September 30. Motor vehicle sales dropped in October and November. Thatâs not organic growth, thatâs artificial demand pulled forward.
The report was also delayed by the 43-day government shutdown, making it outdated. The Congressional Budget Office estimates the shutdown could slice 1.0 to 2.0 percentage points off Q4 GDP.
Hereâs the critical detail: Higher-income households are doing the heavy lifting, thanks to stock market wealth. Middle and lower-income consumers are struggling with rising costs from tariffs. Weâve got a K-shaped economy, and GDP numbers hide that reality.
Corporate profits soared $166.1 billion (4.2%), but that wealth isnât trickling down. Meanwhile, consumer confidence just fell for the fifth straight month to its lowest level since April.
Long-term significance: You canât sustain 4.3% growth on pull-forward demand and AI spending alone. At some point, the broader economy needs to participate. Right now, itâs not.
The big red flag: If you dig into the report, healthcare spending drove much of the consumer activity (hospitals, outpatient care, nursing homes). Thatâs not a sign of economic health, thatâs a sign of uncontrolled healthcare costs hitting inelastic demand. You need care regardless of price, you just find out the cost later.
My advice: Position yourself defensively: quality over growth, cash reserves for opportunities, and exposure to sectors that benefit from the trends weâre seeing (AI infrastructure, commodities, healthcare) rather than sectors relying on broad-based consumer strength.
đĄ Andrewâs Analysis:
Weâre seeing a market where headline strength hides underlying fragmentation. GDP crushes estimates (but itâs not sustainable). AI spending soars (but itâs financing half with leverage). Metals rally (because people donât trust traditional assets). The dollar weakens (because debt concerns are real).
The common pattern? Divergence. Rich vs. poor. Large companies vs. small. AI vs. everything else. Safe havens vs. risk assets.
The biggest takeaway: In divergent markets, the average doesnât matter. Being selective matters. You canât just buy âthe marketâ and expect good results when half the economy is thriving and half is struggling.
My Advice:
Own productive assets: quality stocks, especially those tied to real cash flows and real demand.
Own some real assets: metals, commodities, and possibly real estate you can hold through cycles.
Guard your personal balance sheet: less high-rate debt, more cash buffer, more skill building.
You cannot control the cycle, but you can choose which side of it you stand on.
đ For daily insights, follow me on X/ Twitter, Instagram Threads, or BlueSky, and turn on notifications!
(3) Chart of the Day
Consumer Sentiment Hits All-Time Low Despite "Strong" Economy:
đĄ Andrewâs Analysis:
The University of Michiganâs Current Economic Conditions Index just crashed to 50.4 points, the lowest level ever recorded.
Let that sink in. Not the lowest since COVID. Not the lowest since 2008âs financial crisis. The lowest in the entire history of the index.
Itâs 5 points below the 2022 inflation peak and 8 points below the 2008 financial crisis. Even more shocking, itâs 11 points lower than 1980, when annual inflation was 13.5%.
Americansâ assessment of current buying conditions for big-ticket items also hit a record low.
Hereâs why this matters more than any GDP number: People know what theyâre feeling better than economists know what theyâre measuring.
When I worked at JP Morgan, weâd always say the data tells you where weâve been, but sentiment tells you where weâre going. Right now, sentiment is screaming that somethingâs wrong.
The chart shows three previous crisis points: Black Monday (1987), 9/11 (2001), the Financial Crisis (2008), and COVID (2020). Each time sentiment crashed, it eventually recovered. But notice where we are now: below all of them.
The disconnect is the story: Stocks at all-time highs. GDP crushing expectations. Unemployment still low. Yet people feel worse than ever.
Why? The affordability crisis. Housing costs have exploded. Groceries cost more. Healthcare is crushing budgets. Yes, you have a job, but your paycheck doesnât go as far.
This is the K-shaped economy in one chart. If you own stocks and real estate, youâre thriving (the market reflects that). If youâre living paycheck to paycheck, youâre drowning (sentiment reflects that).
Long-term implications: You canât sustain a healthy economy when consumer sentiment is this bad. 70% of GDP is consumer spending. If people feel this pessimistic, theyâll eventually spend less, which slows growth, which validates their pessimism.
Itâs a self-fulfilling prophecy waiting to happen.
Historical context: Every time sentiment hit extreme lows in the past, it marked a turning point. Sometimes markets fell (2008). Sometimes they rallied as conditions improved (post-COVID). The key is that extremes donât last.
My advice:
Treat this as a warning sign, not a prediction. When sentiment is this bad, one of two things happens: Either conditions improve and sentiment rebounds (bullish for stocks), or sentiment proves right and the economy weakens (bearish for stocks).
Position for both outcomes:
Keep cash reserves (15-25% of your portfolio). If sentiment proves right and markets fall, youâll have buying power at lower prices.
Own quality defensive stocks that perform regardless of economic conditions. Think healthcare, utilities, consumer staples. Companies people need, not want.
Avoid high-flying growth stocks trading on future promises. When consumers are this pessimistic, those future earnings look less certain.
Consider bonds or gold for protection. Both tend to hold up when economic concerns materialize.
Donât panic sell everything. Sentiment can be wrong (it often is). Just prepare for the possibility itâs right.
The contrarian opportunity: When sentiment hits extremes, the biggest gains often come to those who position themselves opposite the crowd. If everyoneâs pessimistic but you see signs of improvement, thatâs when you buy. If everyoneâs euphoric but you see cracks, thatâs when you protect.
Right now, weâve got record pessimism in consumers but record optimism in markets (remember Bank of Americaâs Extreme Bullish indicator?).
One of these will be proven right. The question is which one.
Your edge comes from being ready for both.
The chart is telling you that regardless of what headline numbers say, the average American is struggling. That struggle will eventually show up in earnings, spending data, and market performance.
The only question is when.
đ For daily insights, follow me on X/ Twitter, Instagram Threads, or BlueSky, and turn on notifications!
(4) Stocks to Watch
(1) Structure Therapeutics $GPCR up +13% on 12/23
(2) Hycroft Mining $HYMC up +11% on 12/23
(3) Rocket Lab $RKLB up +10% on 12/22
(4) Unusual Machines $UMAC up +9% on 12/23
(5) Novo Nordisk $NVO up +7% on 12/231) Structure Therapeutics $GPCR up +13% on 12/23
Structure Therapeutics, a clinical-stage biopharmaceutical company developing treatments for chronic diseases, jumped 13% riding the coattails of Novo Nordiskâs FDA approval for the first GLP-1 weight-loss pill. This is sympathy momentum at its finest. When the FDA validates a new drug category, it lifts the entire sector because it proves the regulatory pathway exists. Structure is working on its own weight-loss compounds, and investors are betting that if Novo can get approval, others will follow. The GLP-1 market is massive (obesity affects 40% of Americans), and thereâs room for multiple winners.
2) Hycroft Mining $HYMC up +11% on 12/23
Hycroft Mining, a gold and silver producer, climbed 11% following its announcement that its mine in Nevada is yielding better results than anticipated. In mining, operational execution is everything. Better-than-expected yields mean higher profits, longer mine life, and improved economics. With gold and silver hitting all-time highs (as we covered earlier), Hycroft is leveraging perfect timing. The stock was already benefiting from record metal prices, and now operational improvements are adding fuel to the fire.
3) Rocket Lab $RKLB up +10% on 12/22
Rocket Lab, a space launch and satellite manufacturer, soared 10% after winning an $816 million contract to build a missile-defense satellite constellation for the US Space Force. This is a game-changer for Rocket Lab. The company has been building credibility as a SpaceX alternative, and landing a nearly billion-dollar defense contract validates that position. Defense contracts are recurring revenue streams with high barriers to entry. Once youâre in, youâre in. This win positions Rocket Lab for more government work and proves they can compete for large-scale programs.
4) Unusual Machines $UMAC up +9% on 12/23
Unusual Machines, a domestic drone manufacturer, rose 9% after the FCC banned drones and components from several Chinese manufacturers, citing national security risks. This is regulatory-driven opportunity. When the government forces buyers to choose domestic suppliers, American companies win by default. The drone market is exploding (delivery, surveillance, infrastructure inspection, agriculture), and Unusual Machines just got a massive tailwind from Washington. Expect more defense and commercial orders to flow toward US-based manufacturers.
5) Novo Nordisk $NVO up +7% on 12/23
Novo Nordisk, the pharmaceutical giant behind Ozempic and Wegovy, surged 7% after the FDA approved the first GLP-1 weight-loss pill. This is massive. Until now, GLP-1 treatments required injections, which limited adoption despite their effectiveness. A pill form removes the biggest barrier to widespread use. The addressable market just expanded dramatically. Novo Nordisk is already the leader in this space, and being first with an oral option solidifies that dominance. Expect continued strong earnings growth as more patients switch to pill form.
đĄ Andrewâs Analysis:
Two Themes Dominating This Weekâs Winners
Theme 1: The GLP-1 weight-loss revolution is real. Novo Nordisk, Viking Therapeutics, and Structure Therapeutics all surged on the same catalyst. The FDA approval of an oral GLP-1 drug just expanded the addressable market by tens of millions of patients. This isnât hype, itâs a genuine healthcare transformation. The obesity market is worth hundreds of billions annually, and weâre watching the infrastructure get built in real time.
Theme 2: Government policy creates winners overnight. Unusual Machines and Rocket Lab all benefited from US government decisions. When Washington picks winners (domestic drones, defense contractors), regulatory moats get built instantly. You canât compete on price if youâre banned from the market.
Advice: Build a watchlist around these themes. GLP-1 plays: Watch the entire supply chain (manufacturers, distributors, pharmacy benefit managers). Defense/domestic manufacturing: Track companies benefiting from national security policies and reshoring trends.
The unifying principle? These arenât speculative bets, theyâre companies with catalysts already in motion. Thatâs the difference between gambling and investing.
đ For daily insights, follow me on X /Twitter; Instagram Threads; Facebook; or BlueSky, and turn on notifications!
(5) Todayâs Trade
Hertz Global Holdings $HTZ: Bullish Bet on Rental Car Recovery
Options traders are making a 9-to-1 bullish bet on Hertz Global Holdings, the rental car company thatâs been through bankruptcy, a meme stock surge, and a painful EV fleet writedown.
Hereâs whatâs happening: Traders are piling into the February 20th $5.00 call options, with 3,966 contracts traded versus zero open interest. That means every single contract represents fresh positioning, not existing trades being closed. The majority were bought in blocks ranging from small to a massive 1,050-contract purchase at the ask price of $1.00, signaling serious conviction.
When someone buys at the ask (instead of waiting for a better price), theyâre saying âI need this position now, and Iâm willing to pay up for it.â Thatâs typically institutional money or informed traders.
What Hertz does: Hertz rents cars. Simple business, brutal economics. You buy cars, rent them out, hope they donât get destroyed, then sell them used. The company went bankrupt during COVID when travel stopped, emerged, got swept up in the meme stock craze, then crashed after losing billions on an ill-timed Tesla fleet purchase.
The bull case hidden in these options: With the stock at $5.80 and traders buying $5.00 calls expiring in February, theyâre betting on a minimum 20-30% move in two months. For that to happen, something has to change.
What could change? Travel demand is strong. Airlines are packed, hotels are full, and rental car rates remain elevated. Hertzâs core business (business travelers, vacation rentals) is actually performing well. The stock trades at distressed levels because of balance sheet concerns and the EV writedown, not because people stopped renting cars.
Second catalyst: Used car prices have stabilized after falling for two years. Hertz makes money two ways: rental revenue and selling off used inventory. If used car values stop falling or even rise slightly, Hertzâs losses turn into gains.
Third catalyst: The company is restructuring under new management after the EV disaster. When youâre trading at basement prices and you stop doing stupid things, the bar for positive surprises is very low.
My take: Cautiously bullish, with a big caveat.
The options activity suggests smart money sees a setup. The risk-reward at these levels is interesting. If Hertz can stabilize its fleet values and show decent Q4/Q1 rental demand, the stock easily runs to $7-8, which would make these February $5.00 calls extremely profitable.
But hereâs the risk: Hertz has a history of disappointing shareholders. The EV fleet mistake destroyed billions in value. The balance sheet is still weak. If thereâs another negative surprise (more writedowns, demand weakness, fleet problems), this stock could easily test new lows.
What Iâd do: This isnât a bet Iâd make with conviction unless I saw evidence of operational improvement in the earnings reports. The options activity is intriguing, but smart money can be wrong (especially with a company that has Hertzâs track record).
If youâre tempted to follow this trade, size it appropriately. Options expire worthless if youâre wrong, so only risk what you can afford to lose completely. A safer approach? Wait for Hertz to prove it can execute for two consecutive quarters, then buy the stock (not options) if the turnaround is real.
The lesson here: When you see concentrated options buying with bullish positioning, somebody knows something or thinks they know something. That doesnât mean theyâre right, but it means you should pay attention. Do your own homework, understand the risks, and never blindly follow options flow.
Sometimes the smart money is early. Sometimes theyâre wrong. Your job is to figure out which one it is before you put money at risk.
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(6) Fear & Greed Analysis
The Fear & Greed Index sits at 59 (Greed), up from 55 at the previous close, 45 one week ago, and a shocking 5 one month ago. One year ago, it was at 30. Thatâs a massive swing from extreme fear to greed in just 30 days.
This is bullish for continued gains in the short term, but itâs also flashing yellow warning lights.
Hereâs what the 59 reading tells us. Weâre in greed territory, but not extreme greed (which starts at 75). Markets tend to perform best when sentiment is improving but hasnât reached manic levels. Right now, weâre in that sweet spot where investors are optimistic but not yet irrational.
The trajectory matters more than the absolute level. Moving from 5 to 59 in a month is extraordinarily fast. That kind of sentiment whipsaw typically happens when markets rally hard after a period of fear (which is exactly what weâve seen with the Santa Claus rally starting and the strong GDP print).
Long-term significance: When fear turns to greed this quickly, it usually means one of two things. Either (1) the previous fear was overdone and weâre simply normalizing, or (2) weâre setting up for a correction because sentiment is moving faster than fundamentals.
Iâve seen this pattern many times. Rapid sentiment shifts create opportunities, but they also create risk. The opportunity is that momentum can persist (greed breeds more greed as FOMO kicks in). The risk is that when everyoneâs bullish, thereâs nobody left to buy.
Remember Bank of Americaâs Bull & Bear Indicator hitting âExtreme Bullishâ territory that we discussed earlier? Thatâs essentially saying the same thing as this Fear & Greed reading: investors are getting optimistic, and historically, extreme optimism precedes pullbacks.
But hereâs the nuance: weâre at 59, not 75 or 85. Thereâs still room for sentiment to improve before we hit true euphoria. The Santa Claus rally period has historically been bullish, and with GDP crushing expectations and earnings season approaching in January, greed could push higher before reality sets in.
Final thought: Greed rising is positive for continued gains, but the speed of the move suggests weâre closer to a peak in optimism than a bottom.
A simple framework:
When the index is below 25: build a shopping list and add winners.
Between 25 and 75: you stick to your plan, rebalance on schedule, and ignore noise.
Above 75: you tighten risk and avoid new leveraged bets.
đ For daily insights, follow me on X /Twitter; Instagram Threads; Facebook; or BlueSky, and turn on notifications!
(7) Technical Analysis
1) S&P 500 SPY 0.00%â
Trend: positive overall, neutral in the very short term.
The S&P 500 sits near 6,900, inside a rising channel and just under clear resistance around 6,900â6,950. It has closed at record highs as AI and mega-cap tech keep pulling the index up.
What this tells you:
Buyers are still in control.
Short term, the index is close to the âtop of the rangeâ, where small pullbacks are normal.
Longer term, the uptrend remains intact as long as pullbacks stay above prior support levels.
2) Tech Stocks QQQ 0.00%â
Trend: positive but fragile.
The Nasdaq-100 is also in a rising channel, but technicians see a possible head-and-shoulders pattern forming. That is a classic topping pattern where buyers run out of energy near the prior highs.
Key points:
Support sits near 23,900â25,150.
Resistance is close above at around 25,770.
If price breaks below support with high volume, that would confirm the pattern and point to a deeper pullback.
AI leaders like Nvidia and cloud names are still carrying this index. When those few names pause, the whole index can stall even if most stocks do not move much.
3) Bitcoin $BTC
Trend: neutral with rising downside risk, but long term still in a bigger bull cycle.
Bitcoin trades around 88,000, after slipping below 90,000 and breaking out of a short-term falling channel. ETF outflows and year-end positioning have cooled demand, even though 2025 as a whole is still a strong up year.
Here is the picture:
Short term: sideways to lower, with support near 86,000.
Medium term: weak negative, as ETF flows and derivatives pressure create chop.
Long term: prior cycles and ETF adoption still point to higher highs over several years.
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(8) Ban Insider Trading for Politicians
Itâs time to ban insider trading for Politicians. They are supposed to serve the public, not use their power to grow their stock portfolios.
While hardworking Americans struggle to pay their bills, members of Congress are lining their pockets with insider information. If me or you did this then we would be in prison. But when they do it, it's âlegal.â
Members of Congress should work for the people, not for their own bank accounts. It's a CLEAR conflict of interest for lawmakers (with access to non-public info) to profit from the companies they are supposed to be regulating.
Instead of protecting us, theyâre profiting off us. They should not be able to profit from the inside information they get on the job. Their job should be serving the people who elected them.
The solution is simple: Make it illegal.
Itâs time to ban insider trading in Congress.
Do you support this?
Make your voice heard. Sign and share this petition if you support a ban on members of Congress from trading stocks:
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