The AI Repricing
Nick Schmidt
Nasdaq broke to new highs this week making it the fastest recovery I've ever experienced. I pointed out the decisive candles with the green arrows in last week's report, something I have mentioned over the past few weeks that I like to see to indicate the bottom is in. The candle this week looked even more decisive.
QQQ
MA4W·10W·30W
Last year had almost identical action. Big decisive candles indicating follow through. It then went up so fast everyone doubted it, then gapped higher and kept going higher.
QQQ
MA4W·10W·30W
We're extended and we'll pull back for sure but early in a cycle like this with such a sharp recovery by the time it shows up you'd already have built a big cushion being in to withstand it. These early uptrends are the only windows I buy strength just because its the only way to get in.
Whats most important though is this action is being led by growth stocks breaking out of multi-month bases. The participation is broad and we have the stocks leading that are needed to lead.
Semis are the most important group and the breakout to new highs last week in SMH followed through powerfully again. The full AI infrastructure stack every layer is moving together powerfully which indicates a big repricing in AI spend.
For months we have not seen any breakouts stick or follow-through and the past 2 weeks have been a totally different market.
SMH$464.16
MA4W·10W·30W
My Focus
MU$455.07
MemoryMA4W·10W·30W
Focus because of the base, shakeout candle, fundamentals, has all the ingredients. I may add if it pulls and retests the base pivot ~430.
AMD$278.39
SemiconductorMA4W·10W·30W
AMD basing for months with strong breakout. Still buyable, would like to see an inside week like TER had retest base pivot that would make great entry.
CLS$396.01
AI Hyperscalers & NeocloudsMA4W·10W·30W
One of the best base breakouts. Same pattern... push to top of the base came quick and feels extended, then follow-through. Characteristic of this market has been that follow through. Any weakness that shows respect for prior ATH 364 level or deeper but holds base pivot I would buy.
GLW$164.38
Fiber & NetworkingMA4W·10W·30W
Broke to new highs then quiet inside week retest. Same pattern. I would watch weakness to 154 level or another inside week.
SATS$133.21
Space & DefenseMA4W·10W·30W
Break to highs out of a base, retest and trying to go. Similar pattern everywhere. I like this for entry around 126 level. I would have bought this last week if I had the money I got back from NFLX failed trade.
TSLA$400.62
RoboticsMA4W·10W·30W
Earnings this week. Have a feeling Elon will discuss the new Tesla AI chips and could set off the major rally out of the 5 year base. Took a position against my normal weakness-buyer bias because the character matched GOOGL, AMZN, and CRWV earlier in the week. If I cant get enough cushion before earnings I will exit and wait to buy back.
Notable Charts
Semiconductor+10.2% avg
20 names4 notable
This year the bottleneck shifted to the layer making the chips themselves, which is a better setup for the equipment makers.
Names
CRDO+34.4%ALAB+16.8%ARM+12.0%NVDA+6.9%
CRDO$160.69
SemiconductorMA4W·10W·30W
ALAB$174.05
SemiconductorMA4W·10W·30W
ARM$166.73
SemiconductorMA4W·10W·30W
NVDA$201.68
SemiconductorMA4W·10W·30W
The biggest AI leader in the market is breaking out of a long tight base.
Memory+8.1% avg
1 names1 notable
Memory is quietly the biggest way to play AI. The special memory chips AI training needs take up a lot more room in the factory than the regular memory that goes in a laptop, so the factories fill up and all memory prices get dragged higher together. MU is telling customers they can only get about half of what they're asking for. Biggest position in my book.
Names
SNDK+8.1%
SNDK$920.99
MemoryMA4W·10W·30W
AI Hyperscalers & Neoclouds+11.8% avg
7 names5 notable
The bear case on CRWV and NBIS was always that GPUs lose value fast, rental prices come down, and the stocks hurt. The latest numbers show the opposite happening. Rental prices are up 40% since October, every company renting out GPUs is sold out, customers are locking in the higher rates for 5 years, and the stocks still haven't caught up to that. The big AI playerd on top (GOOGL, AMZN, META, ORCL) are also saying they can't buy enough GPU capacity through 2026.
Names
ORCL+26.8%CRWV+14.6%NBIS+8.4%GOOGL+7.7%AMZN+5.1%
ORCL$175.06
AI Hyperscalers & NeocloudsMA4W·10W·30W
CRWV$116.85
AI Hyperscalers & NeocloudsMA4W·10W·30W
30% short and this move has been on big volume. Plan is to sit and let it trend.
NBIS$157.14
AI Hyperscalers & NeocloudsMA4W·10W·30W
Meta just added $27B in March on top of the existing $17.4B Microsoft deal. Order book stacking.
GOOGL$341.68
AI Hyperscalers & NeocloudsMA4W·10W·30W
Bought this in last weeks wick and it followed-through to a new weekly closing high and almost new all time high. Can use the prior weekly base high to find an entry.
AMZN$250.56
AI Hyperscalers & NeocloudsMA4W·10W·30W
Software+25.8% avg
3 names2 notable
Names
RNG+20.6%PLTR+14.3%
RNG$40.39
SoftwareMA4W·10W·30W
Big moat with camera network and data. Long multi year base potentially about to breakout. Looks similar to DOCN
PLTR$146.39
SoftwareMA4W·10W·30W
AI Power+12.2% avg
9 names3 notable
Names
BE+24.7%IREN+22.4%CIFR+17.2%
BE$207.86
AI PowerMA4W·10W·30W
Top watch but quite extended now from the base. On strength if we open in the wick it could potentially be an in the wick play, or else have to wait.
IREN$48.12
AI PowerMA4W·10W·30W
Group is strong and it looks similar to CRWV into the down trend line. Could buy the break and look for instant follow-through similarly.
CIFR$19.37
AI PowerMA4W·10W·30W
Fiber & Networking+7.1% avg
6 names3 notable
Names
UI+17.2%COHR+12.2%AAOI+5.9%
UI$1084.50
Fiber & NetworkingMA4W·10W·30W
COHR$345.02
Fiber & NetworkingMA4W·10W·30W
AAOI$159.42
Fiber & NetworkingMA4W·10W·30W
Dont see a way in this yet now that its taken off but will keep an eye. Weakness to 130 level that holds is area of interest.
Space & Defense+9.1% avg
8 names1 notable
Strong group strength here shows growth participation broadening. The government is showing up as a big recurring buyer. Idk how the group reacts to SpaceX ipo but looks good now.
Names
RKLB+24.6%
RKLB$84.80
Space & DefenseMA4W·10W·30W
Strong breakout of the tight area. Still a hard name to buy on strength Id watch for inside week retest showing any respect.
Quantum Computing+45.7% avg
4 names3 notable
Group ran together again looking like it could see another big move in quantum. Speculative group for now it trades on catalyst and sentiment so holding any of these means not marrying the position. I treat these more as swings.
Names
QBTS+52.2%QUBT+35.6%RGTI+34.9%
QBTS$21.69
Quantum ComputingMA4W·10W·30W
QUBT$9.57
Quantum ComputingMA4W·10W·30W
RGTI$19.81
Quantum ComputingMA4W·10W·30W
Storage+8.7% avg
2 names
Watchlist
ThemeNamesWeekBreadthLeadersFocus
Quantum Computing
4
+45.7%
100%
IONQ +60.1%QBTS +52.2%QUBT +35.6%RGTI +34.9%
-
Biotech
1
+40.8%
100%
TVTX +40.8%
-
Fintech
2
+33.2%
100%
DAVE +35.2%HOOD +31.2%
-
Software
3
+25.8%
100%
BAND +42.6%RNG +20.6%PLTR +14.3%
-
Robotics
1
+14.8%
100%
TSLA +14.8%
TSLA
AI Power
9
+12.2%
89%
BE +24.7%IREN +22.4%APLD +20.1%CIFR +17.2%
BE, IREN
AI Hyperscalers & Neoclouds
8
+11.9%
100%
ORCL +26.8%CRWV +14.6%CLS +12.7%DELL +10.5%
CRWV, CLS, NBIS, GOOGL
Semiconductor
21
+10.4%
90%
CRDO +34.4%ON +20.9%ALAB +16.8%ICHR +14.3%
AMD
Storage
2
+8.7%
100%
STX +8.9%WDC +8.5%
-
Space & Defense
9
+8.3%
86%
RKLB +24.6%FLY +16.5%RDW +11.3%ONDS +9.5%
SATS
Memory
2
+8.1%
100%
MU +8.2%SNDK +8.1%
MU
Fiber & Networking
7
+5.5%
71%
UI +17.2%COHR +12.2%AAOI +5.9%VIAV +5.6%
AAOI, GLW
Consumer
5
+4.2%
100%
SPOT +12.7%TPR +3.7%AAPL +3.7%WMT +0.6%
-
Materials
1
-10.1%
0%
AA -10.1%
-