Micron Earnings Will Set Course of AI Rally, Apple’s Problem for Europe, Bitcoin ETF Cool Inflows – Micron Technology (NASDAQ:MU)

To gain an advantage, this is what you need to know today.

AI Rally Course

Please click here for an expanded table of Micron Technology Inc smack.

Note the following:

• This article is about the big picture, not an individual stock. The MU stock chart is being used to illustrate this point.
• Micron’s gains will determine the course of the AI ​​rally. Micron’s earnings will be released after the close on Wednesday.
• The chart shows a widening gap after the earnings release last quarter. The Bulls expect a similar gap this time around. However, careful investors know that earnings are a risk event and results can go either way. Consider starting with Arora’s Second Law of Investing and Trading, which states, “No one knows for sure what will happen in the markets.” Consider following Arora’s Third Law, which states, “Making investment and trading decisions based on probabilities is the only realistic and profitable approach.”
• The chart shows that in June, MU stock accelerated away from the trend line.
• The chart shows last week MU shares traced a sliding candle. This is a negative pattern.
• The bear covering pattern at Micron coincided with a bear covering pattern at NVIDIA Corp NVDA. Please click here to read more.
• High-bandwidth storage is essential for AI data centers. As we’ve shared with you before, Micron is selling out of high-bandwidth memory for the rest of the year.
• Consensus estimates for Micron’s earnings are $0.48 and $6.6 billion in revenue.
• The whisper numbers have been rising and are now at $0.55 in earnings and $7 billion in revenue.
• Stocks move based on the difference between the reported numbers and the whispered numbers. Whisper numbers are the numbers that analysts share privately with their best clients and are often different from the numbers those same analysts release to the public.
• The fate of artificial intelligence growth, and in turn the fate of the entire stock market in the short term, depends on Micron’s earnings, forecasts and comments. Historically, Micron’s CEO tends to be very bullish.
• Nvidia (NVDA), the king of AI, continues to be lower in volatile trading after tracking a negative technical pattern last week. It is worth noting that there was a rally attempt around 8:00 AM ET, but the rally attempt failed. If a bullish attempt succeeds, it will move the entire stock market higher.
• Cautious investors should note that NVDA stock has fallen despite massive buying by the technology ETF Technology Select Sector SPDR Fund XLK. XLK has about $72 billion in assets. Last week, it increased NVDA’s stake from about 5% to over 20%. XLK compensated by reducing AAPL’s stake from about 21% to about 5%.
• The European Commission said it Apple Inc AAPL that in advance, Apple’s App Store is in violation of the Digital Markets Act (DMA). Investors are ignoring it because in the past, Apple’s regulatory violations have only resulted in slaps on the wrist. However, cautious investors should pay attention to DMA because DMA has teeth.
• Chicago Fed President Austan Goolsbee is optimistic that inflation data will improve as the economy shows signs of cooling.

Seven Great Cash Flows

In early trading, cash flows are positive Meta Platforms Inc META AND Tesla Inc TSLA.

In early trading, cash flows are neutral in AAPL, Amazon.com, Inc. AMZNAND Alphabet Inc Class C GOOG.

In early trading, cash flows are negative Microsoft Corp MSFT and NVDA.

In early trading, cash flows are mixed SPDR S&P 500 ETF Trust SPY AND Invesco QQQ Trust Series 1 QQQ.

Momo Crowd And Smart Money

Investors can gain an advantage by knowing the cash flows in SPY and QQQ.

Investors can have a greater advantage by knowing when the smart money is buying stocks, gold and oil. The most popular ETF for gold is SPDR Gold Trust GLD. The most popular ETF for silver is iShares Silver Trust SLV. The most popular ETF for oil is United States Oil ETF USO.

Bitcoin

Cash flows into bitcoin ETFs have cooled. This leads to a fall in bitcoin BTC/USD. Bitcoin is trading below $62,000 as of this writing.

Protective bands and what to do now

It is important for investors to look ahead and not in the rearview mirror.

Consider continuing to hold existing good, very long-term positions. Based on individual risk preference, consider a hedge consisting of cash or treasury bonds or short-term tactical trades, as well as short- and medium-term hedges and short-term hedges. This is a good way to protect yourself and participate in the subversion at the same time.

You can define your hedge bands by adding money to the hedge. The high protection belt is suitable for those who are older or conservative. The low protection band is suitable for those who are younger or aggressive. If you do not hedge, the total cash level should be more than stated above, but significantly less than cash plus hedges.

A hedge band of 0% would be very bullish and would indicate full investment with 0% cash. A hedge band of 100% would be too low and would indicate the need for aggressive cash hedging and aggressive hedging or short selling.

It is worth remembering that you cannot take advantage of new future opportunities if you do not have enough money. When adjusting hedge levels, consider adjusting partial stop amounts for stock (non-ETF) positions; consider using wider stops on trailing amounts and also allow more room for high beta stocks. High beta stocks are those that move more than the market.

The traditional 60/40 portfolio

The probability-based risk premium, adjusted for inflation, does not favor long-term strategic bond allocations at this time.

Those who want to stick to the traditional allocation of 60% to stocks and 40% to bonds may consider focusing only on high-quality bonds and bonds with maturities of seven years or less. Those who wish to bring sophistication to their investing may consider using bond ETFs as tactical rather than strategic positions at this time.

The Arora report is known for its accurate calls. The Arora report correctly called the big AI rally before anyone else, the new bull market of 2023, the bear market of 2022, the new stock market highs just after the virus low in 2020, the fall of virus in 2020, the DJIA’s rally to 30,000 when trading at 16,000, the start of a major bull market in 2009, and the financial crash of 2008. Please click here to sign up for a free Wealth Generation newsletter forever.

This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been modified for content or accuracy.