Closing Market Report: Feb. 27th, 2024

Following last week's Nvidia-driven gap run, this week has been a very boring market. Both volume and volatility have collapsed.

As I showed on Twitter, Tech now has a four day gap up island ahead of PCE Thursday, which happened to be the duration of the CPI gap down island as well:

Below the surface of the somnolent market there is plenty of froth in this market, especially in the crypto stocks and Bitcoins, which have absolutely nothing to do with "AI". One wonders why today's pundits can never connect the dots between an over-lubricated market and their fabricated narrative of the day.

Coinbase is up 90% in three weeks. Recall that these crypto infrastructure stocks led the entire stock market in 2023, but then they got pounded lower at the start of the year with the advent of Bitcoin spot ETFs. One can presume that there is now billions of dollars in 401k money parked in Bitcoins, ready to implode.

Speculative Biotechs are also pumping

Semiconductors overall, are still digesting last week's big gains, however Micron has been playing catch-up lately as they just announced a big order from Nvidia this week.

As we see, this stock has a history of being late to the party since it's still heavily dependent upon PC chip sales which are imploding.

All in all, it's clear that FOMO social mood is playing a big joke on the fools at large who should have heeded Warren Buffett's advice and exited this end of cycle Ponzi market while they had the chance.

This AI bubble is the least believable "new high" we've seen in stock market history. Led by a handful of massively overvalued stocks.

The chart below is the ratio of the Nasdaq 100 to the NYSE Composite.

By the law of ever-increasing market/economic inequality, this bubble is even bigger and deadlier than the last one.

Bears may have capitulated, but fortunately bulls are always trying hard to prove me right.