Image Source: Pexels

Nvidia (NVDA) made a new high last week. It simply soared as it reported earnings, and it is now just about the only stock people are talking about. Its move, of course, helped push the S&P 500 up to a new 52-week figure. How much longer can Nvidia keep going up at this pace? We’ll see.

A lot of people have made a comparison between Nvidia and Cisco Systems (CSCO) back in 1999, myself included. However, now it reminds me of when silver went up in 2011, although the move in early January is similar to the breakout that Cisco made in November of 1999.

It seems like a lot of big money investors have been cashing out recently. Bill Gates sold off all of his “Magnificent Seven,” big-cap, tech stocks holdings. He sold all of his shares in Apple (AAPL), Google (GOOGL), Amazon (AMZN), Meta (META), and, yes, Nvidia.

This is according to his recent SEC filings that includes his holdings dating back to Dec. 31, 2023. Here are some of his trades.

You can find the complete Gates report here.

Of course, I’m sure there are some traders who think he is a fool for selling all of these big-cap, tech stocks like he doesn’t know anything about the sector and they do -- much like many thought they knew about GameStop in 2022 or cryptocurrencies.

Meanwhile, shares of Newmont Corporation (NEM) crashed last week as the company announced that it was cutting its dividend almost in half in order to pay off its debt load more quickly.

Gold mining stocks have been performing poorly for over a year now and have been lagging the performance of gold, which has been doing well during this rate hiking cycle, as it has been trading in a range, and is now holding above what is becoming solid support in the $1980-$2000 range.

So, what is hurting gold stocks?

I recently talked about that with Jordan Roy-Byrne earlier this month. He thinks it is higher costs from rising energy prices and inflation that have been hurting the profitability of mining operations. He believes that once gold goes above $2100 that the margins for mining will become more profitable and the stocks will soar.

But, gold isn’t likely to get above $2100 until the Federal Reserve really starts to lower interest rates. And despite all the recent rate cut talk, there is simply no justifiable reason for the Federal Reserve to do that at the moment. There is no recession, and inflation has not gone away.

In fact, the continued stock market speculation, along with the growing mania in Nvidia, may be evidence that interest rates are not too high at all, and thus should not be reduced.

The day will come when the next recession emerges, and many things that seem normal now, especially to those heavily trading these markets, will change overnight. But, I do not know if that will happen in the second half of this year or sometime next year.

More By This Author: