Bifurcation in Tech? No Problem. Tech continues to show minor consolidation, bit by bit, Software, then Mag-7, now Memory/Semis. Yet has done so in a way where market indices have largely avoided weakness Great recovery in $AAPL $META and some much needed stabilization in MSFT to help Roundhill's Mag-7 ETF $MAGS start to trend back higher this week As i discuss in tonight's note, this is beneficial towards Tech despite Semi weakness as other sectors continue to play catch-up.. Fins, and most importantly, Healthcare - Much more in tonight's note and a 10-min video. @IBDinvestors @marketsurge

solana:BifUDWQFpbTrSxYXBnqCpAVYgcyQGzHzJk2MDmeM2Gyv has printed a new all-time high. Market cap has cleared $2M. The chart remains constructive, volume is present, and the next psychological level sits at $5M MC. Hold $TCAT . Earn bittensor:native reflections. Feline form, future mind. @artificialcat_ CA: BifUDWQFpbTrSxYXBnqCpAVYgcyQGzHzJk2MDmeM2Gyv DYOR||NFA

Institutional crypto market structure is bifurcating. Arc, Canton, and Tempo raised over $1B at a combined ~$10B valuation this week. Regulated balance sheets need controlled transaction environments, not fully public infrastructure. Read more on our latest weekly digest:

All correlations breaking down "What has been striking more recently is the bifurcation between the AI and non-AI trade, illustrated by the lowest and most negative correlation on record between our GS Broad AI basket (GSTMTAIP) and SPXXAI Index. The basket and the index have only traded in the same direction 1/3rd of the time in the last 3 months (vs ~2/3rd historical average)." - Goldman

Last wk despite WTI +10% & ylds +2-7 bps across the curve, S&P/Nas/R2K +0.1%/+0.4%/+0.1%. $NVDA acquisition of Hugging Face & $Meta release of Muse Spark 1.3 last wk make both names more attractive into year-end. My view is that LLMs increasingly bifurcate into 90%+ usage of open-source/ open-weight models in the future as companies optimize the right models for the right task. Since the focus on controlling AI expenditures, the Silicon Data token cost has fallen over 50% since late May but the weekly usage of tokens in models across OpenRouter has increased by 3.6x over this same time. In addition, enterprises are increasingly focused on making sure their own proprietary data does not leak out when they use third party closed frontier LLMs. Hugging Face is the premier central collaborative platform, repository, and toolkit for open-source and open-weight AI with over 18 million developers. Nvidia has three customers that accounted for 44% of their revenues over the past six months and their largest customers are increasingly designing their own ASICs and in some cases selling them externally. A more diversified customer base that owns their own AI compute stack instead of renting from the big cloud service providers would help Nvidia with both of these issues. With this acquisition, Nvidia is in an even better position to sell enterprises a complete alternative AI stack (from the model to chips) where the customer will own their own data. Valuation is also compelling. Nvidia trades at a 15x CY27 PE versus their own guidance for 70% revenue growth and the Big 3 public cloud service providers at 21-23x for 15-26% total revenue growth. The S&P trades at 19x for 9% revenue growth for comparison. Nvidia is also up “just”24% versus the Semiconductor Index up 66% following underperformance last year at up 39% versus 42%. As for Meta, the stock is down 7% year-to-date after being up just 13% last year driven largely by concerns that 1) they can only monetize their near doubling in AI capex spend through efficiencies in their own business and 2) they were falling behind in the AI model race. The launch of the Muse Spark 1.3 API last week, catapulted Meta back to near frontier status (Top four in the Artificial Analysis Intelligence Index out of 10 models) but with aggressive token pricing (Bottom four in Cost per Task.) Open-weight versions of the Muse Spark lineup are coming soon. This will give the company another way to monetize their aggressive capex plans. This follows Meta's settlement in late August with state AGs on their youth addiction trial which was another overhang on the stock. Trading at 16x CY27 PE for 20% revenue growth is compelling with the settlement and Spark 1.3 launch as catalysts. From a broader market perspective, I recommend caution between now and the US mid-terms for reasons I have fleshed out in prior posts including: 1) Don’t Fight the Fed given I believe a 9/16 hike is likely 2) September -0.5% on avg & up only 48% of the time 3) S&P drawdowns of 10% in lead-up to mid-terms 4) Bipartisan pushback against datacenter expansion 5) Iran dragging out hostilities through US mid-terms

We are seeing a market that, on the surface, appears to be moving into a Confirmed Uptrend, with several major indexes breaking out or moving to new highs. However, the underlying evidence is far less convincing. What is missing is a bona fide follow-through day—a strong advance of 1% or more on increased volume—accompanied by broad participation and a plentiful number of individual stocks breaking out and following through successfully. Without that confirmation, we view the action with a degree of suspicion. The market remains severely bifurcated. Small caps, represented by the Russell 2000 (IWM), remain near their lows, while the Dow and many economically sensitive cyclical stocks continue to lag. The real strength is concentrated in the mega-cap stocks that dominate the capitalization-weighted S&P 500 and Nasdaq, along with heavily weighted indexes such as the QQQ and FNGS. This kind of narrow leadership is more characteristic of a difficult, volatile, potentially late-stage environment than a healthy, broadly advancing market. Rising interest rates and elevated oil prices provide additional headwinds, and we are still in September, historically a challenging period for equities. Sentiment isn't providing much clarity either. Some measures are registering meaningful fear and bearishness, while others are closer to elevated levels of bullishness. In other words, the mixed picture in the indexes is also being reflected in sentiment. When the evidence is this conflicted, we drill down to what ultimately matters most: the individual stocks. If quality stocks are breaking out, following through, and rewarding us for taking risk, we participate. If they aren't, we stay defensive. Right now, the evidence at the individual-stock level is also mixed and lacking and does not provide the type of confirmation that would justify aggressive exposure. For now, we remain in a cautious, prove-it-to-me posture—taking selected opportunities where they present themselves, keeping risk tightly controlled, maintaining hedges, and allowing the market and our individual positions to earn our way into greater exposure. Become a Minervini Private Access member today and get the Minervini Markets 360 platform included.

Technology remains the clear market leader with strength concentrated in fiber optics, semiconductors, data storage, networking, hardware, machinery, and selected medical groups. Energy and Transportation have been notable laggards. At the same time, we have a market that is severely bifurcated. Applying the Cycle Composite concept across the major indexes highlights just how significant the divergences have become. The Nasdaq Composite has deviated considerably from its historical seasonal pattern, while the Dow has tracked its composite more closely. The Russell 2000, meanwhile, has been in a relatively steady downtrend over the past five weeks. The more important message is what is occurring beneath the surface. The average stock has experienced seasonal weakness much closer to the Cycle Composite pattern than the capitalization-weighted S&P 500. RSP, MDY, and IWM remain 5%–7% below their highs, while only 37% of stocks are above their 30-week moving averages, down sharply from 63% in August. This type of narrowing participation and divergence can occur around market tops, although it does not necessarily mean a top is in place. The question is: are we experiencing a stealth correction that is near the end, or a more serious warning. Until breadth and participation improve, we remain patient and highly selective, concentrating on quality stocks displaying strong relative strength and holding key support levels. We continue to hold a small list of longs that have held stops and performed well. Names include: $TWLO, $DE, $MRK, $TEVA, $TGTX, $HTFL - this morning we reduced our $IWM short/hedge and took off our overweight.

A very material catalyst came about for Western supply chains from $AAOI, $SIVE / Jabil, to $LITE and Coherent: The Trump administration is drafting a ban of new Chinese optical transceivers and DC devices. Which would likely hit China’s Innolight, Eoptolink, and other Chinese optical interconnect supply chains. "The agency would ban all imports of new transceiver models ​and then exempt many ⁠non-Chinese suppliers from the restrictions" We'll likely see a larger bifurcation of supply chains with even greater importance put on Western players.

Outside of Tech, $XLI was hard hit today, & $LII $PSN $VFC, $VRT $DBD, $ACHC all suffered abnormally big losses as XLI broke its trend from late March. While Tech losses thus far have not really spread to other parts of the market which have been strong of late, like HC, Fins, which along with Industrials, all made new highs in the last month, it's important to keep a close eye on these given that Tech losses have accelerated of late. The bifurcation has grown w/ Equal-weighted SPX having made new All-time highs yesterday but meanwhile SPX, QQQ just broke short-term support I'll be discussing this in notes in the days ahead, but today's XLI break is not dissimilar from what happened in $DJI and both look to have short-term downside given today's break. Selectivity is important for those short-term oriented @marketsurge @IBDinvestors #IBDPartner#