📈 Chasing Alpha Weekly
Semis up 50% from the bottom. 83% of S&P companies beating and raising. And everyone thinks they missed it. Here's why they're wrong.
Chasing Alpha Weekly drops every Sunday. I break down the macro signals, sector rotations, and specific trade setups I’m watching for the week ahead. If you’re new here — subscribe below so you don’t miss it.
The market keeps grinding higher and the most common thing I’m hearing is “I missed it.”
You didn’t miss it. You’re asking the wrong questions.
This week I want to walk you through what institutions are actually doing, why the fundamental case for semis and storage is stronger than most people realize, and what the one wild card is that nobody seems to want to buy protection for. There’s a lot in here. Let’s get into it.
What Happened Last Week
↑ Winners
$SPY & $NDX continue grinding higher — breadth holding above key levels
Storage earnings explode — $WDC, $STX, $MU posting historic numbers
$GOOG and $AMZN cementing their position as AI race winners
Institutions buying aggressively into the close — last hour data hitting unprecedented levels
→ Watch
$IGV holding despite every reason to crack — software more resilient than expected
$AAPL rejected at the highs on Friday — institutions used it as a selling opportunity
Rate cut odds collapsing — 77% chance of no cut, 9% chance of a hike
↓ Laggards
Oil diverging from rhetoric — something doesn’t add up
$META conference call raised more questions than answers
OpenAI CFO leak suggesting cash flow problems — read that WSJ piece if you haven’t
The One Thing Everyone Is Getting Wrong
Before we get into setups, I want to address the elephant in the room — because it’s the thing I keep hearing over and over and it’s costing people money.
“I missed it.”
Let me ask you a different question. How do you know you missed it?
When the market was rolling over earlier this year, it wasn’t because earnings were bad. It was because nobody knew what was going to happen with tariffs, the strait, the macro picture. The market hates uncertainty. It sold off because of uncertainty — not fundamentals.
Then earnings season started. 83% of S&P companies beat and raised guidance. Not beat. Beat and raised. And the market ripped.
So before you say you missed it, ask yourself: did you say earnings were going to be bad? Because if you didn’t, why are you surprised that the market went higher?
Ask yourself better questions and you’ll get better answers. The bias that says “I missed it” is the same bias that keeps people out of the best trades.
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The Institutional Picture: This Is Not a Short Squeeze
There’s a chart I watch closely — the last hour cumulative advance/decline line for $SPY. It measures how aggressively institutions are buying into the close, which is when they tend to move.
What it’s showing right now is unlike anything I have on record.
The speed and rate of institutional accumulation coming off this bottom is stronger than anything I can find going back decades. Stronger than the pandemic bounce. Stronger than the 2022 bottom. The closest comparable I found was 1998 — and even that wasn’t this aggressive.
Here’s what matters: when institutions are buying this hard and the market is moving commensurately with that buying, it means there is very little supply. People are not trying to get out. That’s a completely different dynamic than most prior bottoms where institutions were absorbing heavy retail selling.
This is not short covering. This is straight up institutional accumulation. And until that changes, the path of least resistance is higher.
The Fundamental Case: Storage and Memory Are Still Cheap
Let me give you the actual numbers from this earnings season because I think people are still not grasping what happened.
$WDC / $SNDK
Data center revenue up 251% year-over-year
Expected to earn $22 — came in at $34
Gross margins crossed 50% for the first time in company history
EPS up 289% year-over-year
$MU
Record $23.86B fiscal revenue, up 200% year-over-year
Largest sequential revenue jump in company history
Responsible for roughly 50% of all S&P earnings growth on a percentage basis
$STX
Non-GAAP gross margins hit 47% — up 1,000 basis points
EPS of $4.10, up 115% year-over-year
When $STX and $SNDK were down Thursday evening after these numbers, we got involved. Because when a company posts the largest sequential revenue jump in its history and the stock goes down after hours, that’s not a fundamental problem. That’s an opportunity.
The PEG ratio on these names — meaning what you’re paying relative to their growth rate — is historically low. Not just low. Historically low. The growth is actually accelerating faster than the stock prices are moving. That is an objective fact.
The 5 Setups I’m Watching This Week
📌 $MU / $SNDK — Still the Core Position
Largest sequential revenue jump in $MU’s history — the cycle is not over
$SNDK backlling cleanly after its breakout bar — holding the move
PEG ratio historically cheap even after the run
People keep asking if they missed this. The company just posted its best quarter ever.
I’m still long and the thesis hasn’t changed.
📌 $STX / $WDC — Storage Breakout Confirmed
$STX broke out Friday on massive volume — institutions making sure they were filled by end of week
Gross margins crossing 50% for the first time is not a one-quarter event — it signals pricing power
Analysts upgrading price targets by hundreds of points, not tens
Fridays with institutional volume like this are meaningful.
This is the setup I’d be focused on heading into next week.
📌 $INTC — The Pig That Became a Setup
Beat EPS estimates by 2,800% last quarter
Data center CPU demand accelerating — every data center being built needs processors
Breaking out of a multi-year base — measured move target puts this significantly higher
I’ve been calling this a pig for years. The earnings changed my mind. When you do the work — listen to the call, read the transcript, run the bull and bear case — you understand why institutions are buying it.
I now understand why people own this.
📌 $GOOG / $AMZN — The AI Race Winners Are Clear
$GOOG and $AMZN are cementing their positions as the structural winners of the AI buildout
AWS getting stronger — watch how they characterize Anthropic usage on future calls
Both names have the infrastructure, the distribution, and the balance sheet to win
The losers are also getting clearer. $META can’t tell you what they’re doing with their AI spend. OpenAI may have cash flow issues. The winners are concentrating.
Own the winners.
📌 $AXTI + Second Tier Optics — The Next Wave
$AXTI posted a monster earnings move and broke out cleanly
Optic names starting to set up ahead of their earnings — people are trying to get ahead of them
Second tier semi names broadly starting to shape up
The primary semi names have moved. The broadening into second tier optics and analog names is the next leg.
This is early and worth watching carefully.
What I’m Watching This Week
Rate Hike Risk
Fed Watch now showing 9% chance of a hike, 77% no move, 13% cut — this will skew further toward a hike when the next data drops. Watch oil.
$IGV
Held despite every reason to crack. If it can get and stay above its 55-day, the long/short semi vs software pair trade needs to be reassessed.
Oil Divergence
Crude dropping while rhetoric stays hot. When price and narrative diverge this sharply, something is happening under the surface that I don’t have full visibility into. This is the wild card nobody is buying protection for.
$AAPL
Institutions sold hard on Friday. Interesting quarter but hardware cycle concerns remain. Watch how it acts early in the week.
The Bottom Line
The institutions are not covering shorts. They are buying. The earnings are not good — they are historic. The PEG ratios are not expensive — they are historically cheap. And 83% of S&P companies just beat and raised guidance.
The reason most people feel like they missed this is not because they missed it. It’s because they never built the conviction to get involved — and now they’re waiting for a pullback that institutions may not give them.
Stop asking if you missed it. Start asking what’s actually going on and why.
The full breakdown — including the last hour institutional data, the forward PE comparison going back to the late 90s, and the full storage earnings analysis — is on YouTube now.
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For educational purposes only. Not financial advice. Do your own research.
Thanks Anthony, I looked forward to this every Sunday, and you never disappoint. Larry just wants to be your friend 🐦