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The Rotation Out of AI Stocks Just Started [A WARNING to All Investors]
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Entry is the asset's closing price on the publication date. Current is the last close on record.
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Entry $106.32 05 Jul 2026Current $131.11 09 Sep 2026Result +$24.79vs. index +21.0% SPY +2.4% over the same days
I told you last week that these stocks were no-brainers. Absolute no-brainers.
AI-extracted context Now, the MAG 7 and mega cap tech catching a bid. I told you last week that these stocks were no-brainers. Absolute no-brainers. Of course, it is my hope that we get a run in Microsoft, in Service Now, in Meta, in Amazon.
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Entry $582.90 05 Jul 2026Current $653.69 09 Sep 2026Result +$70.79vs. index +9.8% SPY +2.4% over the same days
I told you last week that these stocks were no-brainers. Absolute no-brainers.
AI-extracted context Now, the MAG 7 and mega cap tech catching a bid. I told you last week that these stocks were no-brainers. Absolute no-brainers. Of course, it is my hope that we get a run in Microsoft, in Service Now, in Meta, in Amazon.
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Entry $242.67 05 Jul 2026Current $252.40 09 Sep 2026Result +$9.73vs. index +1.6% SPY +2.4% over the same days
I told you last week that these stocks were no-brainers. Absolute no-brainers.
AI-extracted context Now, the MAG 7 and mega cap tech catching a bid. I told you last week that these stocks were no-brainers. Absolute no-brainers. Of course, it is my hope that we get a run in Microsoft, in Service Now, in Meta, in Amazon.
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Entry $360.45 05 Jul 2026Current $364.38 09 Sep 2026Result +$3.93vs. index −1.3% SPY +2.4% over the same days
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…uld save a lot of money by doing that. And you could buy puts in things like QQQ, or you could buy puts in individual AI stocks like Leopold, for instance. It really depends on what you're holding and how much you need to hedge. All right, some of my favorite stocks right now in the AI buildout pullback in the semis, we have Marll, Broadcom, Intel, Qualcomm. Now, I want you to remember that this is not a video on swing trading. These are not trades. These are not options trades. These are not swing trades. I'm tired of people who have zero business managing their money, buying random tickers, …
some of my favorite stocks right now in the AI buildout pullback in the semis, we have Marll, Broadcom, Intel, Qualcomm.
AI-extracted context All of my favorite stocks right now in the AI buildout pullback in the semis, we have Marll, Broadcom, Intel, Qualcomm.
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Entry $245.29 05 Jul 2026Current $235.01 09 Sep 2026Result −$10.28vs. index −6.6% SPY +2.4% over the same days
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…ou know how crazy this is? That means that Broadcom has been growing at an average annual rate of 25% a year for 10 years. So, a stock like Broadcom to me is not a swing trade, but a stock like Marll, which we did actually swing last week. Shout out to those who took the TQQ swing as well as the Marll swing. And if you want access to all of the swings, all of the portfolio management moves I'm making, as well as the stocks I'm looking at, the stock market analysis in and of itself, individual stocks that I'm looking to buy, as well as go live …
Shout out to those who took the TQQ swing as well as the Marll swing.
AI-extracted context All of my favorite stocks right now in the AI buildout pullback in the semis, we have Marll, Broadcom, Intel, Qualcomm. ... Shout out to those who took the TQQ swing as well as the Marll swing.
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Entry $120.35 05 Jul 2026Current $106.24 09 Sep 2026Result −$14.11vs. index −14.1% SPY +2.4% over the same days
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… off of the 48 EMA. To me, this looks way more like a swing than say something like Broadcom. All that is to say, this right here, these are not created equal. Don't try don't buy these and just expect to make money within the next day. So I'm also in a position on Intel as well which looks good at this breakout and retest of this bull flag. Even though I think Intel does have a high valuation. There is a lot of expectation coming out of Intel. It is expected to be the Taiwan semiconductors of CPUs. Basically a foundry of CPUs that takes other customers chip designs and manufa…
I'm also in a position on Intel as well which looks good at this breakout and retest of this bull flag.
AI-extracted context All of my favorite stocks right now in the AI buildout pullback in the semis, we have Marll, Broadcom, Intel, Qualcomm. I'm also in a position on Intel as well which looks good at this breakout and retest of this bull flag.
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Entry $176.25 05 Jul 2026Current $176.40 09 Sep 2026Result +$0.15vs. index −2.3% SPY +2.4% over the same days
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…d. And then we have Qualcomm, which is another uh long-term stock that I'm looking at. Although I do not like the chart currently for a swing. And I think that Qualcomm does finally it looks like it it did validate this head and shoulders. I like it from an investment standpoint. I do not like it for a swing here just yet. That could change. Memory. As I said, I issued a buy in the Discord on DRM last week. A pretty big buy on DRAM. It now constitutes 10% of my portfolio as Korea looks like it is recovering from ag…
I like it from an investment standpoint.
AI-extracted context All of my favorite stocks right now in the AI buildout pullback in the semis, we have Marll, Broadcom, Intel, Qualcomm. ... I like it from an investment standpoint. I do not like it for a swing here just yet.
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Entry $12.07 05 Jul 2026Current $10.76 09 Sep 2026Result −$1.31vs. index −13.2% SPY +2.4% over the same days
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… it is recovering from again what I think is just a routine pullback with a bigger mean reversion. So instead of just pulling back to the 921 EMA, every few months it pulls back to something like the 50-day moving average. Now in Photonix, I do like Nokia still. I do think there is a chance that Nokia will get to the 100 day moving average, but I really do like Nokia here. And you can see the last time that it hit close to the 100 day moving average was back in January as the volume continues to g…
I do like Nokia still.
AI-extracted context In Photonix, I do like Nokia still. I do think there is a chance that Nokia will get to the 100 day moving average, but I really do like Nokia here.
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Entry $333.36 05 Jul 2026Current $303.48 09 Sep 2026Result −$29.88vs. index −11.3% SPY +2.4% over the same days
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…is a chance that Nokia will get to the 100 day moving average, but I really do like Nokia here. And you can see the last time that it hit close to the 100 day moving average was back in January as the volume continues to grow in Nokia. And I do like Coherent here as it pulls back to near the 100 day moving average. This to me from a photonic stock perspective, just looking at the trend, this is the one that is upholding the trend the most. If you take a look at Lum, even though I do like some of the things they're doing fundamentally, this stock, you…
I do like Coherent here as it pulls back to near the 100 day moving average.
AI-extracted context In Photonix, I do like Nokia still. I do think there is a chance that Nokia will get to the 100 day moving average... And I do like Coherent here as it pulls back to near the 100 day moving average.
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Entry $215.62 05 Jul 2026Current $240.35 09 Sep 2026Result +$24.73vs. index +9.1% SPY +2.4% over the same days
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…eed to to spread out my holdings over my Photonix holdings over all of these stocks. I could consolidate them into the one that I'm most bullish on, either for a technical reason or a fundamental reason or both. And then data centers here. I still like Nebius. I think they are in the best position. Also added to QQQ. And I do like Wolf here. Something a stock that I haven't owned before, but we did pull back to the 100 day moving average here. And with Coree, I do think it will recover. The chart definitely does not look great here. …
I still like Nebius. I think they are in the best position.
AI-extracted context Then data centers here. I still like Nebius. I think they are in the best position.
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Entry $712.60 05 Jul 2026Current $716.31 09 Sep 2026Result +$3.71vs. index −1.8% SPY +2.4% over the same days
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…ver all of these stocks. I could consolidate them into the one that I'm most bullish on, either for a technical reason or a fundamental reason or both. And then data centers here. I still like Nebius. I think they are in the best position. Also added to QQQ. And I do like Wolf here. Something a stock that I haven't owned before, but we did pull back to the 100 day moving average here. And with Coree, I do think it will recover. The chart definitely does not look great here. I do think that tha…
Also added to QQQ.
AI-extracted context I still believe this is a time to stay hedged the way that I hedge 5 to 10% of my portfolio depending on where we are in the market, but I put in an OTM out of the money puts that expire within 2 or 3 months... Also added to QQQ.
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Entry $270.89 05 Jul 2026Current $269.28 09 Sep 2026Result −$1.61vs. index −3.0% SPY +2.4% over the same days
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…ir capacity would be throttled during peak internal demand because Meta would obviously prioritize its own products over its customers because it doesn't have SLAs's. So, you can pause this, read it, or go to my X page. And then for power, I like Bloom Energy, VRT, and then TE is a pure play. This to me is still in the range of a penny stock, but it is now consolidating very tight here. And I do think that if TE breaks out, we could start to see that $1516 mark. Now, from a meggaap growth and v…
I like Bloom Energy
AI-extracted context For power, I like Bloom Energy, VRT, and then TE is a pure play.
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Entry $300.53 05 Jul 2026Current $262.89 09 Sep 2026Result −$37.64vs. index −14.9% SPY +2.4% over the same days
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…ir capacity would be throttled during peak internal demand because Meta would obviously prioritize its own products over its customers because it doesn't have SLAs's. So, you can pause this, read it, or go to my X page. And then for power, I like Bloom Energy, VRT, and then TE is a pure play. This to me is still in the range of a penny stock, but it is now consolidating very tight here. And I do think that if TE breaks out, we could start to see that $1516 mark. Now, from a meggaap growth and value stock perspective, I talked a…
I like Bloom Energy, VRT, and then TE is a pure play.
AI-extracted context For power, I like Bloom Energy, VRT, and then TE is a pure play.
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Entry $50.43 05 Jul 2026Current $44.56 09 Sep 2026Result −$5.87vs. index −14.0% SPY +2.4% over the same days
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…nd I think that in your optimized optimal conservative portfolio, obviously, you should be diversified to some degree. How much you are diversified will depend on your risk tolerance, your age, your time to retirement, your needs, etc. But my favorite stocks are the two stocks that I'm holding in healthcare. NVO as well as United Healthcare. And Novo has actually broken out from a very long-term downtrend. Hopefully that continues because it is now smack dab against the longer trend line. So if it breaks out of this longer trend line that it has established since August of 202…
my favorite stocks are the two stocks that I'm holding in healthcare. NVO as well as United Healthcare.
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Entry $425.36 05 Jul 2026Current $393.06 09 Sep 2026Result −$32.30vs. index −10.0% SPY +2.4% over the same days
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…nd I think that in your optimized optimal conservative portfolio, obviously, you should be diversified to some degree. How much you are diversified will depend on your risk tolerance, your age, your time to retirement, your needs, etc. But my favorite stocks are the two stocks that I'm holding in healthcare. NVO as well as United Healthcare. And Novo has actually broken out from a very long-term downtrend. Hopefully that continues because it is now smack dab against the longer trend line. So if it breaks out of this longer trend line that it has established since August of 202…
my favorite stocks are the two stocks that I'm holding in healthcare. NVO as well as United Healthcare.
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Entry $539.39 05 Jul 2026Current $567.50 09 Sep 2026Result +$28.11vs. index +2.8% SPY +2.4% over the same days
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…look at return on invested capital, it's only 8%. price to book is pretty high, but its growth rate and its profitability margin is where it excels and not a lot of stocks fall into that range. I'm not going to go over Mastercard and Visa. These are stocks that I talked about probably last year and picked up and just continue to hold. They are finally catching a bid. Tech go over my last video. Obviously, the Mac 7 is a no-brainer. Netflix is finally catching catching a bid up 10% in the last week. Very similar pattern to Microsoft, by the way. as I said in my last vide…
These are stocks that I talked about probably last year and picked up and just continue to hold.
AI-extracted context I'm not going to go over Mastercard and Visa. These are stocks that I talked about probably last year and picked up and just continue to hold. They are finally catching a bid.
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Entry $362.13 05 Jul 2026Current $367.39 09 Sep 2026Result +$5.26vs. index −0.9% SPY +2.4% over the same days
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…look at return on invested capital, it's only 8%. price to book is pretty high, but its growth rate and its profitability margin is where it excels and not a lot of stocks fall into that range. I'm not going to go over Mastercard and Visa. These are stocks that I talked about probably last year and picked up and just continue to hold. They are finally catching a bid. Tech go over my last video. Obviously, the Mac 7 is a no-brainer. Netflix is finally catching catching a bid up 10% in the last week. Very similar pattern to Microsoft, by the way. as I said in my last vide…
These are stocks that I talked about probably last year and picked up and just continue to hold.
AI-extracted context I'm not going to go over Mastercard and Visa. These are stocks that I talked about probably last year and picked up and just continue to hold. They are finally catching a bid.
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Entry $77.65 05 Jul 2026Current $76.03 09 Sep 2026Result −$1.62vs. index −4.5% SPY +2.4% over the same days
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…lly catching a bid. Tech go over my last video. Obviously, the Mac 7 is a no-brainer. Netflix is finally catching catching a bid up 10% in the last week. Very similar pattern to Microsoft, by the way. as I said in my last video, but to me, this is another one of these no-brainer stocks. Consumer staples, Costco finally fell below a,000. Again, this actually looks like a very similar pattern to to Broadcom, but anytime that Costco is under a,000 or under 900, it tends to peique my interest. I already own Costco. I don't ne…
this is another one of these no-brainer stocks.
AI-extracted context Netflix is finally catching catching a bid up 10% in the last week. Very similar pattern to to Microsoft, by the way. as I said in my last video, but to me, this is another one of these no-brainer stocks.
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Entry $951.67 05 Jul 2026Current $902.60 09 Sep 2026Result −$49.07vs. index −7.5% SPY +2.4% over the same days
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…s, Costco finally fell below a,000. Again, this actually looks like a very similar pattern to to Broadcom, but anytime that Costco is under a,000 or under 900, it tends to peique my interest. I already own Costco. I don't need anymore, but this is one of the consumer stable stocks that I like. And then consumer discretionary Tesla. This is one that will likely have a slow summer, but once it breaks out of this, whether it's on an announcement that it is being acquired by SpaceX, I do think Tesla is obviously very overvalued if y…
this is one of the consumer stable stocks that I like.
AI-extracted context Consumer staples, Costco finally fell below a,000. Again, this actually looks like a very similar pattern to to Broadcom, but anytime that Costco is under a,000 or under 900, it tends to peique my interest. I already own Costco. I don't need anymore, but this is one of the consumer stable stocks that I like.
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Entry $38.82 05 Jul 2026Current $45.37 09 Sep 2026Result −$6.55vs. index −19.2% SPY +2.4% over the same days
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… in the AI portfolio as well as go over the regular portfolio. But I want to also manage the AI portfolio at this time when some of these stocks have pulled back beyond the point of comfort for me. So for instance, my view on Nebus, sorry, my view on iron has totally changed. uh not only because this thing broke, you know, it's continuing to make lower highs, lower lows, but it broke a lot of structure as well as the fact that the compensation package by the executives that they handed out, it is pissing off a lot of people. You can read into the story, but the pay package was worth $788 million and they are now spending $50 million a ye…
my view on iron has totally changed. uh not only because this thing broke, you know, it's continuing to make lower highs, lower lows, but it broke a lot of structure
AI-extracted context So for instance, my view on Nebus, sorry, my view on iron has totally changed. uh not only because this thing broke, you know, it's continuing to make lower highs, lower lows, but it broke a lot of structure as well as the fact that the compensation package by the executives that they handed out...
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Entry $390.49 05 Jul 2026Current $491.65 09 Sep 2026Result +$101.16vs. index +23.5% SPY +2.4% over the same days
I told you last week that these stocks were no-brainers. Absolute no-brainers.
AI-extracted context Now, the MAG 7 and mega cap tech catching a bid. I told you last week that these stocks were no-brainers. Absolute no-brainers. Of course, it is my hope that we get a run in Microsoft, in Service Now, in Meta, in Amazon.
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Entry $359.91 05 Jul 2026Current $330.65 09 Sep 2026Result −$29.26vs. index −10.5% SPY +2.4% over the same days
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…e hyperscaler comparison, their debt and earnings outlook, it's very clear if you look at how quickly could they pay off their debt. Each of the hyperscalers, Oracle aside, but each of the hyperscalers in the Mag 7 are either net cash like Alphabet, again my favorite of the MAG7 stocks, or they're able to pay back their debt really quickly because their earnings are growing and they are cash generating machines. So, there's a certain point at which the market is going to accept this and continue to allow these stocks to …
Alphabet, again my favorite of the MAG7 stocks
AI-extracted context If you look at the hyperscaler comparison, their debt and earnings outlook, it's very clear if you look at how quickly could they pay off their debt. Each of the hyperscalers, Oracle aside, but each of the hyperscalers in the Mag 7 are either net cash like Alphabet, again my favorite of the MAG7 stocks, or they're able to pay back their debt really quickly.
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Entry $112.73 05 Jul 2026Current $115.28 09 Sep 2026Result +$2.55vs. index −0.1% SPY +2.4% over the same days
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…know how many times I could tell you guys about Hood and it seems like every time I mention Hood, it keeps taking itself out of the hood because I mean this stock has just been an absolute monster both technically as well as fundamentally. I bought more on each of these pullbacks. Again, I'm not talking about options here, just talking about shares. But Hood is a rule of 40 monster. And if you don't know what the rule of 40 is, it is a way to really evaluate stocks that are hyperrowth stocks because the traditional …
I bought more on each of these pullbacks.
AI-extracted context I don't know how many times I could tell you guys about Hood and it seems like every time I mention Hood, it keeps taking itself out of the hood because I mean this stock has just been an absolute monster both technically as well as fundamentally. I bought more on each of these pullbacks.
Full Transcript
Is the market finally starting a great rotation where money flows back into the mega cap tech that have taken a beating all year? And as AI stocks pull back majorly, what are the best setups in the market right now in the AI buildout? Last week, I told you that some of these stocks were too cheap to ignore and a lot of these have finally caught a bid within the last week. So, let's dive deeper into the topic of whether this is a true rotation that you need to be aware of so that you can maximize the amount of money that you make in this market cycle as we enter the most bullish period historically for stocks. Let's get right into it. So, before I get into the stocks both in the AI buildout as well as the general stock market, mega cap growth and value stocks that I'm looking at right now, let's dive into what is going on here. So, is this a true rotation? First, I want to talk about the pullback in and of itself, the pullback in AI and some of the money inflowing into the Mag 7. There were reports of companies that were seeking out memory from Chinese companies, Chinese memory companies due to the cost, the high cost of Korean memory as well as supply constraints. Remember that the memory providers keep saying we don't have enough supply to meet the demand. Now, this caused a mini DeepSseek like moment in the AI buildout. Starting with memory, you could see that DRM, which is the ETF that keeps a lot of these memory stocks, was down 27% from peaks. And as of the time of this recording, this looks up over 10% right now. And we did take a big position in DRM last week. On July 2nd, added my full position in the ETF. But if we take a look at the Korean index in and of itself, the Cosby, you could see here that from highs, the Cosby was down 21% and ended up closing down 17.4%. And at the same time, if you take a look at stocks like Microsoft, you could see that Microsoft from the bottom was up about 12%. If you take a look at stocks like Service Now from the bottom, this stock is up now almost 19%. And if we take a look at the MAG 7 ETF, you could see from the bottom that we established at the end of June, right now we are up about 7 12% on the total MAG 7. And this is why you're hearing discussions of whether a rotation is happening or not. So is this a real rotation? Is money going to come back flowing into the MAG 7 and the AI trade just going to completely crash from here? Because we want to know what we need to do with our money, right? In my opinion, it's extremely stupid to call something a rotation when we are experiencing pullbacks to very wellestablished support levels. In this case, whether they are support resistance levels or down to the moving averages. The Korean index in and of itself is very volatile because a lot of it is comprised of these memory stocks. Back in February and March, we had a drop of 20% to the 50-day moving average before rallying again. And now we had a drop of about 17% to the 50-day moving average. Now vertical moves like the ones that you see in in AI obviously reflect a burst of optimism and definitionally they can't sustain their own rate of change. So a mix of rebalancing, profit taking, deleveraging, etc. as well as momentum will often cause mean reversion mechanisms. Now, when you're dealing with uh high beta stocks, that mean reversion could be in the tens of percentage points. So, a stock like Coherent for instance, which is in photonics, if this thing drops 25% and is still in trend, that's not a big deal. If Apple dropped 25%, it would be a huge deal. And just a quick tip, if you Google what is your stock's beta, you can see how violent this stock moves with relation to the market. So a beta of two means that a stock moves twice as violent as the broad market. That's what we mean when we talk about high beta stocks. Now mean reversions, pullbacks to moving averages even though we still have a sustained trend headlines such as the Chinese memory scare. These to me are not indicative of a true rotation. Have the fundamentals changed with the AI buildout? Has capex slowed? Have earnings from the mega caps, the hyperscalers that are paying for the AI buildout, has that come in less than expected? Has forward guidance been lowered? No. None of that is true. Now, the MAG 7 and mega cap tech catching a bid. I told you last week that these stocks are nobrainers. Absolute no-brainers. In fact, some of these stocks, as I said last week, it is more risky not to own them at these valuations than to own them. Now, of course, it is my hope that we get a run in Microsoft, in Service Now, in Meta, in Amazon. I hope that we get a run in those stocks along with the AI buildout as well. I would like to see a rising tide, lift all stocks kind of phenomenon. But so far, the theme has been that the AI buildout continues to rise and ride along the trend. And during the periods of pullbacks, that money then flows into the MAG 7. Now the real tell will be earnings guidance and capex. I don't know if Meta, Microsoft, Amazon, Google if they announce in the next earnings. And by the way, earnings are coming up. So if you look at Microsoft earnings, they're coming up on July 28th. If you look at Meta earnings, these are coming up on July 29th. If you look at Google earnings, these are coming up on July 28th. So we will see Mega Cap Tech earnings by the end of the month. And if they come out and say we're spending even more money, does that then smack the mega cap tech back down? Or has the market finally priced in the fact that these companies are going to continue to make money and continue to spend money? So if you look at the hyperscaler comparison, their debt and earnings outlook, it's very clear if you look at how quickly could they pay off their debt. Each of the hyperscalers, Oracle aside, but each of the hyperscalers in the Mag 7 are either net cash like Alphabet, again my favorite of the MAG7 stocks, or they're able to pay back their debt really quickly because their earnings are growing and they are cash generating machines. So, there's a certain point at which the market is going to accept this and continue to allow these stocks to run higher. Is it going to be now? I don't know. But I told you last week that 350 level which was the former all-time high tested as resistance support again. If we look on Alphascope right now, you could see that Microsoft's forward earnings are currently oh 20. Yes, still ridiculous. So in my mind, I cannot call this a true rotation until a few things happen. We have to see the AI stocks break trend. If you look at this, this is SanDisk for instance, still holding the trend really nicely. just reverted to the 48 EMA, something that it has done a couple times this year as well as a couple times last year. If you look at SMH, which is the semiconductor ETF, we reverted down to the 48 EMA. Trend is still unbroken here. A true rotation grinds lower highs on bounces is something that is reflective of a true rotation. And breaking down support levels. So you have to see something like this in a true rotation, not something that mean reverts back to a trend line. And in my view, the AI buildout is far from over, especially if the Fed starts monetary easing next year or starts cutting rates next year. That will even then promote the hyperscalers to spend even more and raise capex even more. I'll believe it when I see either lower earnings on the mega caps, lower than expected earnings. if they lower their guidance significantly and or if they lower their capex and say we're no longer spending money then I think that if if they lower cap if one of the the hyperscalers actually lowers capex I think that will cause a chain reaction that the market is not ready for but I think we are far from that if they lower capex I think the AI names will tank and by tank I mean they are going to crash and I'm not talking about AI names that are mega caps. I'm talking about the photonic stocks. I'm talking about the data centers, memory and storage, and maybe even Nvidia can tank because it is obviously the biggest chip maker in the world. And if capex is pulling back, then Nvidia in and of itself can drag down the market a little bit. But I also think that those names that a lot of these names that I told you about last week, whether it's Amazon, Google, Microsoft, I think those names will rally like no to like no tomorrow. If you tell me that this picture is changing where these companies are not spending any more money, they're not taking out any more debt and they just are now going to generate cash in the way that they did before all of this started. And finally, before I get into the stocks that I'm looking at right now in this market cycle, shout out to this account, Ask Livermore on X, but the periods where SPY outperform tech for at least 45 days in a bull market. This is actually very normal. You could see that almost every year this happens. The average duration is 77 days. And you could see here that tech rallies pretty hard after the spy outperforms tech for 45 plus days and we're still in a bull market. Okay, let's talk about what stocks I'm looking at right now on the pullback both in terms of the AI buildout as well as the broader market. But I want to keep reiterating this because I don't think it's getting in some of your guys' heads. I really think that people should be separating out their AI buildout portfolios from the more conservative traditional portfolios because like I said it is high beta and a lot of people I think what they did and what they're doing is they're yoloing AI buildout stocks at the top because they're so excited and they see how you know how strong this trend is here that when we pull back to bigger moving averages which is very normal and will happen as you can see here. This right here is coherent pulling back to almost the 100 day moving average. Something that it has done a couple of times this year. These are high beta stocks. A pullback to these simple moving averages could represent 25 30 35% of the stock in and of itself. And if you're not ready to absorb that and you got excited and bought at the top, especially if you're dealing with options, which I am not at the moment, your portfolio is absolutely getting shredded on days where we have these pullbacks or weeks where we have these pullbacks. And I think doing this also allows you to manage risk better and initiates a type of due diligence where you know you have accepted that this portion or or this amount of money here or this percentage of your portfolio your overall portfolio you're okay with that swinging wildly while you still have the traditional conservative portfolio in mega cap stocks in value stocks uh things like healthcare as well as things like consumer discretionary consumer or staples, etc. That is how on days like Thursday, I end up with my AI portfolio looking like this, down 3%, while the bigger, more conservative portfolio is up almost 1%. If most of my portfolio is high beta AI stocks at the top, I'm really going to be dealing in these swings that it may be fine for you. But for someone that is looking to manage the risk and invest properly over time, it's it's not for everybody, to be honest. So in my opinion at this time with this AI pullback, it's time to recognize which sectors and stocks are holding up. They are actually not performing equally. And is it time to consolidate some of your positions? I have an investing call with the group this week where we will go over this in the AI portfolio as well as go over the regular portfolio. But I want to also manage the AI portfolio at this time when some of these stocks have pulled back beyond the point of comfort for me. So for instance, my view on Nebus, sorry, my view on iron has totally changed. uh not only because this thing broke, you know, it's continuing to make lower highs, lower lows, but it broke a lot of structure as well as the fact that the compensation package by the executives that they handed out, it is pissing off a lot of people. You can read into the story, but the pay package was worth $788 million and they are now spending $50 million a year to put their logo on the Golden State Warriors jerseys. And speaking of data centers, I forgot to mention one of the reasons, one other reason that some of the AI stocks were pulling back was because Meta came out and said that they could get into the business of selling compute. So beyond the memory stocks crashing or pulling back, we saw data center stocks actually crash. So iron, core, nebas has pulled back to just the 50-day moving average. So this is what I mean by recognizing stocks and sectors that are still in trend. In my opinion, memory is still in trend. Nebas is still in trend, but not the overall data center stocks as iron as well as coreweave, which I do like better than iron. But, you know, these stocks are breaking down and I do think Core Weef will recover once it gets back into this channel. And it is one of the stocks that I'm looking at. More on that later. So, I have no problem consolidating some of my positions, meaning taking the positions that have broken down or stocks that I don't believe in as much like an iron and say putting that into the rest of the data center category in my portfolio or spreading it into, you know, upweing another category in the portfolio if I'm more bullish on this memory pullback, for instance. I still believe this is a time to stay hedged the way that I hedge 5 to 10% of my portfolio depending on where we are in the market, but I put in an OTM out of the money puts that expire within 2 or 3 months. That way it doesn't drag my portfolio down if the stock market rallies. But if we get a violent push down that then expands the delta of those out-of-the-oney puts, I can save a lot of money. I won't be green in a major pullback, but I could save a lot of money by doing that. And you could buy puts in things like QQQ, or you could buy puts in individual AI stocks like Leopold, for instance. It really depends on what you're holding and how much you need to hedge. All right, some of my favorite stocks right now in the AI buildout pullback in the semis, we have Marll, Broadcom, Intel, Qualcomm. Now, I want you to remember that this is not a video on swing trading. These are not trades. These are not options trades. These are not swing trades. I'm tired of people who have zero business managing their money, buying random tickers, and then putting in the comments, "Are you still holding this stock? What is the plan here?" Dude, have a plan before you buy it. Okay? Now, these are not all created equal. Some of these do look better for a swing or for a a more immediate return, such as Marll. Some of these don't, like Broadcom or Qualcomm, for instance. So if you look at Broadcom and Qualcomm's charts, you could see QVGO. If you look at Broadcom's chart here, you could see that it is sitting at the 200 day moving average and it completely broke down this recent trend that it had. However, it is probably sitting at a major Fibonacci level, the golden pocket right here, 200 day moving average. So in my opinion, there is not a technical setup for a swing yet. And I'm not swinging Broadcom at all. However, from an investment standpoint, this stock is trading 18 times forward earnings if you look on Alphascope. And if you look historically at the PE ratio, it typically has a pretty high PE ratio. Typically trading in the 40s, 50s, sometimes 80s with gross profit, revenue, EBIT, cash from operations, net income at an all-time high. And my favorite metric, free cash flows, generating more free cash flows than it ever has before. Return on invested capital of almost 20%. Super solid compound annual growth rate, 10 years, 25%. Do you know how crazy this is? That means that Broadcom has been growing at an average annual rate of 25% a year for 10 years. So, a stock like Broadcom to me is not a swing trade, but a stock like Marll, which we did actually swing last week. Shout out to those who took the TQQ swing as well as the Marll swing. And if you want access to all of the swings, all of the portfolio management moves I'm making, as well as the stocks I'm looking at, the stock market analysis in and of itself, individual stocks that I'm looking to buy, as well as go live with me every single day of market open. Link is in the description below. Come and join us. It's a lot of fun and you get to learn a lot. You won't regret it. But if you look at Marll here, this is holding a bull flag off of the 48 EMA. To me, this looks way more like a swing than say something like Broadcom. All that is to say, this right here, these are not created equal. Don't try don't buy these and just expect to make money within the next day. So I'm also in a position on Intel as well which looks good at this breakout and retest of this bull flag. Even though I think Intel does have a high valuation. There is a lot of expectation coming out of Intel. It is expected to be the Taiwan semiconductors of CPUs. Basically a foundry of CPUs that takes other customers chip designs and manufactures chips for them. And it is an American company backed by the American government. And it's very important for the American government for this initiative to be fulfilled. And then we have Qualcomm, which is another uh long-term stock that I'm looking at. Although I do not like the chart currently for a swing. And I think that Qualcomm does finally it looks like it it did validate this head and shoulders. I like it from an investment standpoint. I do not like it for a swing here just yet. That could change. Memory. As I said, I issued a buy in the Discord on DRM last week. A pretty big buy on DRAM. It now constitutes 10% of my portfolio as Korea looks like it is recovering from again what I think is just a routine pullback with a bigger mean reversion. So instead of just pulling back to the 921 EMA, every few months it pulls back to something like the 50-day moving average. Now in Photonix, I do like Nokia still. I do think there is a chance that Nokia will get to the 100 day moving average, but I really do like Nokia here. And you can see the last time that it hit close to the 100 day moving average was back in January as the volume continues to grow in Nokia. And I do like Coherent here as it pulls back to near the 100 day moving average. This to me from a photonic stock perspective, just looking at the trend, this is the one that is upholding the trend the most. If you take a look at Lum, even though I do like some of the things they're doing fundamentally, this stock, you'd never want to see a stock rounding at the top like this. same as AOI. So this is what I mean by consolidating some of these stocks, right? If you're holding Lmentum, AOI, Nokia, as well as Coherent, you might then say, okay, I don't need to to spread out my holdings over my Photonix holdings over all of these stocks. I could consolidate them into the one that I'm most bullish on, either for a technical reason or a fundamental reason or both. And then data centers here. I still like Nebius. I think they are in the best position. Also added to QQQ. And I do like Wolf here. Something a stock that I haven't owned before, but we did pull back to the 100 day moving average here. And with Coree, I do think it will recover. The chart definitely does not look great here. I do think that that meta headline was just a scare. That to me was just complete BS. As I said on X, by the way, follow me on X for free trading and finance content every single day. But I basically wrote a post on why Meta cannot compete with Coreweave and with Nebus because Meta doesn't have dedicated SLAs's. So they're not going to be selling compute or no customer in their right mind would buy compute from Meta when it will always prioritize its internal workloads. Remember it has its own LLM called Llama. and external customers will always fear that their capacity would be throttled during peak internal demand because Meta would obviously prioritize its own products over its customers because it doesn't have SLAs's. So, you can pause this, read it, or go to my X page. And then for power, I like Bloom Energy, VRT, and then TE is a pure play. This to me is still in the range of a penny stock, but it is now consolidating very tight here. And I do think that if TE breaks out, we could start to see that $1516 mark. Now, from a meggaap growth and value stock perspective, I talked about this in the last few videos, but I do think healthcare will continue to be strong. And I think that in your optimized optimal conservative portfolio, obviously, you should be diversified to some degree. How much you are diversified will depend on your risk tolerance, your age, your time to retirement, your needs, etc. But my favorite stocks are the two stocks that I'm holding in healthcare. NVO as well as United Healthcare. And Novo has actually broken out from a very long-term downtrend. Hopefully that continues because it is now smack dab against the longer trend line. So if it breaks out of this longer trend line that it has established since August of 2024, then I think that NVO could have a very strong back half. But so far this year from the bottom uh NVO is already up 44% and United Healthcare has just been a slow creeper. Remember when this stock was just ranging in between $240 and $340 and it is now trading at $424. I don't know how many times I could tell you guys about Hood and it seems like every time I mention Hood, it keeps taking itself out of the hood because I mean this stock has just been an absolute monster both technically as well as fundamentally. I bought more on each of these pullbacks. Again, I'm not talking about options here, just talking about shares. But Hood is a rule of 40 monster. And if you don't know what the rule of 40 is, it is a way to really evaluate stocks that are hyperrowth stocks because the traditional metrics don't aren't aren't enough to keep up with the way that these stocks are growing. So it's basically the annual revenue growth rate plus the profitabilit profitability margin. It's a percentage. So when you add both of these numbers, the higher it is, the better. And whether you're talking about EBITDA, whether you're talking about free cash flows, whether you're talking about EBIT, it's going to differ. But anywhere between 50 and 90% is Hood's rule of 40, which is outstanding. That's why if you look at Hood's traditional metrics, if you look at the Ford PE, you might say, uh, that's not that attractive. If you look at price to sales, it looks a little high. If you look at return on invested capital, it's only 8%. price to book is pretty high, but its growth rate and its profitability margin is where it excels and not a lot of stocks fall into that range. I'm not going to go over Mastercard and Visa. These are stocks that I talked about probably last year and picked up and just continue to hold. They are finally catching a bid. Tech go over my last video. Obviously, the Mac 7 is a no-brainer. Netflix is finally catching catching a bid up 10% in the last week. Very similar pattern to Microsoft, by the way. as I said in my last video, but to me, this is another one of these no-brainer stocks. Consumer staples, Costco finally fell below a,000. Again, this actually looks like a very similar pattern to to Broadcom, but anytime that Costco is under a,000 or under 900, it tends to peique my interest. I already own Costco. I don't need anymore, but this is one of the consumer stable stocks that I like. And then consumer discretionary Tesla. This is one that will likely have a slow summer, but once it breaks out of this, whether it's on an announcement that it is being acquired by SpaceX, I do think Tesla is obviously very overvalued if you're using traditional metrics, but the talk is heating up with regards to robotics as well as with regards to AI chipm etc. collaborations with SpaceX that could propel the stock to a new valuation and I would not be surprised if it eventually breaks out of here. Obviously, there are many, many stocks I could talk about. Please don't leave me messages saying, "Well, you didn't talk about this. That means you hate it." No, shut up. I don't. It's I cannot talk about every single stock here. And if you think that there is a stock that you like, put it in the comment section and we'll have a discussion about it. I try to respond to every single comment. So, we are having an investing call this week in the Traveling Trader Academy. Make sure that you sign up, become a member if you want to join. You might find a 25% off code from July 4th that may still be active depending on when you're watching this. So, if it is, make sure you take advantage of it. Make sure that you get an account with Alphascope. In my opinion, the most concise, easy way to read fundamentals extremely quickly in a visually pleasing manner at your fingertips. Let me know in the comment section below what AI stocks you were looking at and what regular stocks you are looking at as well. What does your portfolio consist of? Would love to hear from you. Subscribe to the channel. Hit that notification bell. Stay safe out there, traders.
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