AI-related stocks saw significant gains on Wednesday, propelled by the impact of Stargate. Oracle stock surged 6.7% to 184.18, breaking above the 50-day moving average. This move put Oracle within a base with a buy point at 198.31, presenting an early entry opportunity. Investors could consider entering near the high of 191.99, particularly if a handle develops.
ARM stock jumped nearly 16%, reaching 179.93, racing through the buy zone of a six-month cup-with-handle base. The original buy point was 164.16.
Palantir stock saw a 5.2% jump to 76.87, finding support near its 50-day line last week. On Wednesday, the stock reclaimed its 10-week line and broke a downtrend in a short consolidation. While not technically part of Stargate, Palantir maintains close ties with Oracle.
CrowdStrike stock climbed 3.2% to 377.98, breaking above most of its trading range within a flat base, with a traditional buy point at 389. This base could also be viewed as an alternate handle to a six-month base.
Nvidia stock rose 4.4% to 147.07. After reclaiming its 50-day line on Tuesday, Nvidia offered an early entry in a messy pattern. A move above 150 could signal a clear entry point.
Microsoft stock saw a 4.1% increase, reaching 446.20 after rebounding from its 50-day line. Microsoft still has some distance to go to reach the 468.35 buy point, or even an early entry of 456.16. Earnings are due on January 29.
Despite some early declines on Thursday, these stocks maintained the bulk of their gains from Wednesday.
Market Outlook and Strategy
The stock market rally continues to perform well, with major indexes surpassing several resistance levels, highlighted by the S&P 500’s new-high move on Wednesday.
New buying opportunities are emerging as recent stocks with actionable setups continue to rise. However, many of these stocks are becoming extended, so investors should have gradually added exposure over the past sessions.
For those who are nearly fully invested, the focus should shift to trimming laggards and adding more promising names.
While AI stocks showed strong performance on Wednesday, caution is advised. A portfolio heavily concentrated in AI stocks could face significant risks if the market turns.
Investors should keep working on their watchlists, as more stocks are setting up for potential gains.
For ongoing insights into market trends and leading stocks, be sure to read The Big Picture daily.
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