Nothing disqualifies recent upside in particular technology sectors. Sure the bears continue to argue recession, distribution or the events that occurred 'last year' or even 2021 (distribution under cover of a strong S&P as outlined then), along with historic 'insider selling' then, not now.
 

Freepik

This is a big week for the Fed, earnings and so on. However it's not seriously negative, since everyone expects a rate hike, albeit a debate over 25 or 50 BP. If Apple (AAPL) doesn't disappoint and the Fed does just 25 .. we'll see what I've discussed as possible: post-Fed 'relief rally' after this period of consolidation.
 

There's indeed 'something for everyone' if you want to 'pick and choose' how this market is viewed. If you concur with us that it's 'active' not 'passive' times, you're more focused on your portfolio's holdings, than the expensive S&P that no doubt has to combat a number of headwinds with few tailwinds (other than China's reopening), plus the continuing 'war' in Ukraine. And there's a minority view that China is emboldened because the Ukraine war has depleted NATO weapon stocks, thus China could have an easier time overwhelming Taiwan. I will have more on all this, but hopefully it won't disrupt an adjustment process.

The consensus was so negative that it helped set-up our projected upside via 'January Effect' rebounds. This was about 'don't fight the Fed' last year (sure there's hangover effect there), and now it's about traders using that argument to support what they've done, which is another one: 'don't fight the tape'.
 

Plus you have a 4-star General warning of war or preparing for war. The US Air Force Officer said he wants an 'agile joint force maneuver team' ready to fight and win within the first island chain off Taiwan (think Quemoy & Matsu). 'Agile and preparation' takes us directly to the newly added speculation today.

Notice the memo is dated February 1, 'released on purpose' January 30. So it probably is intended to offset bellicose talk from Beijing, not lead to war.. plus war with China would send Amazon, Apple, Home Depot, Target (importers of cheap Chinese goods etc.) into peril if not bankruptcy overnight.. so no.
 

Meanwhile... I added the first pure-play in Augmented/Artificial Intelligence as of today. Very volatile and speculative BigBear AI Holdings (on the NYSE). I know the sector is a crowded space, but BigBear (BBAI) has unusual endorsements from some high Pentagon guys, has a new CEO who was a VP at IBM over a few divisions, and is past their offering along with a USAF contract under-belt.

New CEO (Amada Long) made significant contributions to IBM 'Watson' (AI), and while I'm not suggesting BBAI as a takeover prospect, their is linkage at both the largest of computer/AI companies and the Department of Defense.

I hope there's no Chinese invasion of Taiwan, but BBAI is our initial stock in a sense positioning for improved intelligence and predictive war analysis. The recent Chinese provocations in Taiwan's airspace were very close to the mark of BigBear's projections, and that might be why the USAF awarded a contract. This stock is trading on volume, wide spreads, and clearly only for gambling in the way we'll watch it, which is not to say it won't have a brilliant future. Might.
 

The graphics are sufficient to introduce this (it's a sprinkle stock, some stay or go over time, and is 'not' for anyone unaccustomed to rapid volume/volatility). It also 'can' have wide spreads and fast moves, but is becoming more widely known. I came across it due to its former CEO (came from DHS) joining DRS, while remaining as an 'advisor' to BigBear. No idea if they're working together or if DRS or anyone else might be a possible suitor for this new AI 'performer'.

By the way, I typed the above 'before' CNBC decided to describe AI as 'the Street's shiny new toy'. Well guess what... Wall Street has said 'every year' was the year for AI for 2 or 3 years now. And maybe this one will really be. I suspect 'if so', that BigBear is one of the better potential plays, not obscure and has significant Government relationships, as well as qualified team and adequate funding, or so it now appears. It's also less than half what people were paying last year, so again it's bouncing but could be viewed as value. It was even given a 'de-listing' warning 3 months ago, I guess not anymore :). I see it as a wild directly military-related stock, with industrial applications too.
 

In-sum: 

I dispute the idea that Wall Street is smoking too much hopium, aside the very short-term. We are generally focused on disruptive or advancing new technologies, whereas the pundits are focused on 'old tech' or macro issues.

I realize macro can impede smaller stocks and trends, but it also highlights an interesting sector, when the conservative sector is generally tired or pricey or just narrow. Risks are involved in many ways, but Wall Street generally is very keen on boring stocks, or having an S&P decline because they missed-out on the low constructed over the final weeks of 2022. So maybe S&P shakes-out or not, but if so and it drives down the new players, then all the better to enter rather than focus on the gloom & doom nonsense, which isn't likely to prevail.

The Fed meeting is 'not' likely to change the market for months, even if worst case (presumed to be a 50 BP hike) occurred. What matters is perception not the move. And yes it can impact S&P, but probably just short-term. For sure I talked about a shakeout in parts of February, but not the disaster some keep expecting. Usually if an important accumulation zone (last Fall) is missed the market won't give those who were opposed to buying another entry spot. But it can happen and often that would require an exogenous event to trigger it.

While their may be too optimistic thinking in some corners, I don't see extreme hawkishness dominating, with most negative revisions behind, not ahead. For sure the broad negativity helps the upside, but also the rangebound (at best) S&P allows a focus on individual issues, which are a lot more interesting now.
 

I have felt S&P bottomed in October as part of our 'erratic complex' bottom as I labeled it all an 'inverse head & shoulders' bottom. I see China emerging, do hope war with them is avoided (likely so), as well as avoiding WW3 that some see coming (or already in). I'm not impressed by those calling this a 'bubble', because the easy-money bubble based under-cover of strong S&P in 2021 as well as portions of 2022. It's definitely likely to be ragged, but not catastrophe.

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