Laden...
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Small Account Challenge: $5k to $10k Licia Leslie will leading a group of traders in a challenge to double a $5k trading account. Licia will be using her expert level charting and options trading experience to grow the portfolio in 6 months or less. Jojn us live this Wednesday, January 29th @ 7pm to learn more! Click here to get your name on the list!
Hey Traders,
Yesterday, investors are learning a valuable lesson that farmers and commodity traders learned long ago.
The AI Selloff: A Narrow Event
Nvidia, the king of AI stocks, took a pretty intense haircut, impacting other AI heavyweights like Taiwan Semiconductor, Broadcom, and Micron. However, the selloff was not widespread. The Dow Jones Industrial Average is actually up, and the S&P 500 Equal Weight index, which provides a more balanced market view, is only slightly down.
While the tech sector (XLK) is taking a hit, and sectors like utilities and energy are also suffering due to their AI-related exposure, the broader market remains relatively stable.
The Farmer's Lesson: Finding Alternatives
Just as farmers adjust their crops when corn prices rise, seeking alternatives like soybean oil or olive oil, the AI market is likely to see similar adjustments. Competitors like AMD, Qualcomm, and Intel are heavily investing in AI, and alternative solutions are likely to emerge.
While Nvidia's dominance may diminish, it is unlikely to go bankrupt. However, its current $3 trillion valuation may be unrealistic.
Why This Selloff Doesn't Scare Me
Money is not leaving the market; it's simply shifting. Many stocks are green today, including Apple, China, Costco, CRM, and others. Companies that build on top of AI, such as CrowdStrike, CRM, Apple, and Meta, may benefit from lower AI development costs in the long run.
The VIX and Market Outlook
The VIX, a measure of market volatility, likely peaked and should retreat towards the 17s. Some bargain hunting is expected later in the day, potentially pushing the Dow up significantly.
While Nvidia and other AI-centric companies may still experience some downside, this selloff creates buying opportunities in lower PE stocks and companies that leverage AI platforms.
What does this mean for traders?
This is a sector-specific selloff, not a market-wide crash. The AI landscape is evolving rapidly, and competition will intensify. Money is shifting within the market, creating new opportunities for investors.
Opportunties that Licia is planning to take advantage of in her new Small Account Challenge.
She is taking her option shopping trading method and tuning it for this specific challenge.
The goal?
Double the account in less than 6 months.
Join Licia and Hannah's Small Account Challenge on Wednesday at 7:00 PM to find out exactly how you can join the challnge group.
Get you name on the attendee list for tomorrow night right here.
Your Only Option,
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