Hundreds of billions of dollars are quietly fleeing Micron (MU) right now. That money is landing straight in Apple (AAPL) and mega-cap tech.
This single rotation is the only thing keeping the market alive. When it stops, the whole thing caves.
The market is stuck in the middle
We tried to test lower today. We bounced right back.
The S&P 500 (SPX) sits smack in the center of its range. Reading direction into that price gives you nothing.
The real story is where the money is moving. That is the only edge available right now.
Semiconductors are ground zero
Semiconductors carried this entire rally. Micron and AMD are ground zero for the move.
The year-to-date gains are staggering. In tonight’s video I break down exactly where they stand and why they matter.
Micron is up 187% year to date with earnings already behind it. No catalyst is left to save it.
Intel (INTC) is up 160%. It now sits on the critical 100 level with earnings still ahead.
Marvell (MRVL) is up just 130%. It has already broken down.
Now the semis are testing lower. They look ready to break.
The rotation is nearly one for one
Money leaving semiconductors is rushing straight into the mega-cap names. Apple has gone up in a straight line for days.
Google (GOOGL) and Microsoft (MSFT) are pulling in capital too. Facebook (META) is catching the flow as well.
Apple is nearly a five trillion dollar company. Micron is one-fifth its size.
A giant drop in Micron only nudges Apple higher. Apple is up just 20% on the year.
That gap is the whole point.
The macro is working against us
CPI cooled hard on Tuesday. The market popped and gave it all back.
PPI came in soft this morning. Same result.
The SPX is unchanged on the week, almost to the penny, despite two rounds of cooling inflation data.
Bonds refused to recover. That points to rate pressure or bond vigilantes stepping in.
Thursday and Friday carry an expected move near $55. I am taking the over.
We are now left in the hands of the bond market. Bonds keep selling. Rates rise. The S&P eventually tosses in the towel.
Here is what makes me nervous
The rotation dance works until it does not. Micron is the stock that rallied this whole market.
If money rotates hard out of Micron, I do not think fresh rotations follow. The engine caves in.
Taiwan Semiconductor (TSM) reports tomorrow. The South Korean markets are already pressuring the group.
That is the pending doom hiding under a quiet tape.
I walk through every level, every rotation, and the exact spot where this market breaks.
Comments
Log in or sign up to join the conversation.