Deep Dive
Summer FOMO Arrives: VIX Crashes, Equities Soar
Last week the market was dead quiet — now it's chaos. VIX collapsed from 20.66 to 14, hitting the floor where volatility typically stalls in summer. QQQ showed the cleanest recovery story: double top in May-June, then a clear buy signal off that bounce, and it's been up only since. The S&P 500 keeps printing all-time highs despite a 20x PE ratio that bears say is expensive but the market keeps ignoring. Nvidia is a beast, trading at its lowest PE in years and now just $10 away from 236 resistance. The late summer surge has caught everyone off guard and forced shorts to cover. Broadcom hit a beautiful buy zone at 369 and now sits at 416, though it's running out of steam heading into the seasonal September weakness.
SpaceX's Explosive Run: 45% in Five Days on Earnings
SpaceX went nuclear. It was sitting at $103 a few days ago, then rocketed 45% in five trading days to nearly $148. The catalyst: one of the best earnings calls ever heard. Elon laid out jaw-dropping revenue projections and guided to $100B in revenue by year-end, with $300B ARR next year — if true, that's bonkers. The unlock fears everyone had about early shareholders dumping were dead wrong. Instead, the stock went straight up. On the four-hour chart, you can see relentless green (all buying) with barely any red (selling) at the top around 146. Hedge funds were short SpaceX expecting the unlocks to crater it, but when that didn't happen and earnings crushed expectations, they got nervous and started covering hard. The pair chart with Tesla shows SpaceX now dominates — it went from 1.8 shares of SpaceX to Tesla all the way to 3.2 shares. Elon deployed this morning around $110 and is slowly building, not chasing.
Bitcoin and Crypto: Chopping Sideways Despite Strong Onchain Data
Bitcoin has been rangebound with zero catalysts despite new all-time highs in transactions, users, and DAP revenue. The ETFs did nearly $1B inflows last week, but need another billion to push the price up 3%. Retail has no money or is yoloing into SpaceX instead. The top-and-bottom indicator hit an all-time low again, marking deep value territory, but whether that rebounds is the billion dollar question. Bitcoin versus gold is the wild one — he expected Bitcoin to outperform, but gold went on a rager above $4,500 while Bitcoin went nowhere, so gold is winning that pair. The onchain data typically leads price, so the question is when does the market catch up to the fundamentals. Solana is 8% away from the 200-day moving average around $82, Ethereum is 8% away from $2,800, and the crypto market cap sits far below 2021 levels even though there are way more tokens now. People are getting impatient.
Tesla's Overhang: CyberCab and the SpaceX Acquisition Phantom
Tesla has been a disappointment lately but people get confused about the timeline. Six years ago it was $17, now it's up 850%. But over five years it's only up 43%, which does suck. The killer issue: everyone thinks SpaceX is going to buy Tesla, and that acquisition overhang is putting a dent on the price. If it happens, expect a 50-60% premium. Retail holdings dropped from 44% to 22%, meaning retail capitulated and institutions vacuumed up their bags. But Tesla is on the cusp of big things — Roadster is rumored soon, Tesla Semi is going into scale production any minute in Nevada, Optimus is starting scale production next month, and there are 2,300 CyberCabs pre-positioned around the country ready to get activated. It's going to be slowly then suddenly. The math says SpaceX could get back to $200 quicker than Tesla gets back to $450-500, but that hinges entirely on when the CyberCab truly ramps and when the acquisition actually happens — which could be any day in the next two years.
Palantir, ARM, and the Short Squeeze Contagion
Palantir got caught in a vicious short squeeze. Michael Burry had 66% of his account short with short-dated puts and published a Substack about it, which convinced tons of retail to join the short trade. Then Palantir crushed earnings on August 3rd and the shorts got caught flat-footed, causing a rip higher that caught everyone off guard. The mean reversion chart shows a four standard deviation spike on August 4th — the most extreme move you can see — which typically means a reversion back down over time. It's started to come down but keeps bouncing, suggesting shorts are still covering but the eventual target is back lower. ARM is a beast but he's not chasing it at $274. Revenue is slowing, earnings are slowing, and he'd be happy to buy at $103 but not here. Micron is another AI play that looks pristine with a clean bounce off level four heading to level five, with a target of $1,600 eventually. Nvidia trading at 20 PE and Marvell is one of the cleanest charts, straight up from the $64 buy signal to $328, bounced off level three at $163, and he added to his position there.