| | | | Quantitative Tightening Is OVER?
First, don’t miss today’s Daily Chart Setup trade idea down lower in this newsletter.
Trading desks at JPMorgan and Goldman Sachs both think that the time for QT has come and gone, and now that the FOMC meeting is coming up next week, they both expect the Fed to announce the end of QT and the start of some easing, no matter what we call this next round.
Come join me as we dive in and see what’s moving!
Plus, as always, we have stocks popping and dropping so come find out what is moving this morning as I look for stocks and do some live premarket analysis on SPX, SPY, NDX, QQQ, Russell, IWM and other stocks that are potential plays for the day.
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The Dot-Com Bubble Roadmap and Why We Might Have 3+ Years Left in This Rally
A Pattern That Could Take Us Into 2028 — Or Set Up the Next Big Crash
I've been doing something lately that's gotten me thinking about time horizons in a completely different way.
I pulled up a precise overlay of the 1996-2001 Nasdaq bubble pattern and laid it against where we are right now. And what I'm seeing is both fascinating…
And a little unsettling.
If this pattern holds, we might only be at the equivalent of early 1999 in the dot-com timeline. Think about what that means for a moment. We could chop around for another year, then go parabolic into a blowoff top that doesn't arrive until 2028.
By this time next year, we might be looking at significantly higher prices — and the real fireworks may not even start until after that.
The Infrastructure Parallel Nobody's Talking About
Here's where it gets interesting, and why this comparison matters beyond just chart patterns.
During the dot-com era, the thing everyone was furiously building was fiber optic infrastructure — the pipes for the internet age. And you know what happened? Massive overbuilding. There's still tons of dark fiber sitting unused 25 years later.
Today's equivalent? AI data centers. We're building them at a blistering pace. The companies doing the building are profitable for the most part, but here's the trillion-dollar question…
What happens if they overbuild? What if actual cash demand for AI products doesn't catch up to the pace of construction?
You could have companies spending billions or trillions on infrastructure while making only millions off those investments. That math doesn't work forever.
The Two-Company Rule
History has shown that when you get a new technology, typically only two companies end up truly profitable while everyone else fights for scraps.
Look at smartphones — Apple (AAPL) and Samsung dominate while everyone else scrambles for whatever's left. Even if their product isn't necessarily the absolute best, they have better marketing and market share.
So here's what keeps me up at night: Maybe we reach the top of this market and people suddenly realize there are only two main ways to play AI profitably, and everything else isn't so profitable after all.
I'm not saying the sky is falling. In fact, if this pattern plays out, we might have years of upside left, including a potentially massive parabolic move.
But understanding where we might be in the cycle — and what the historical parallel suggests about overbuilding critical infrastructure — gives us a framework for what could unfold.
Keep your eyes on how this develops. The pattern suggests patience might be rewarded, but also that the eventual unwind could be just as dramatic as the run-up.
Now be sure to join me live at 9:15 a.m. ET for “Morning Monster,” my market-open livestream on YouTube!
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