From the trading desk of Adam Mesh:
On Monday, we woke up to the biggest Nasdaq sell off we’ve seen in quite some time.
China was celebrating DeepSeek’s AI success and to say at a fraction of the price would be more than an understatement.
Now, in fairness, I wouldn’t trust China’s information on anything.
They weren’t candid with us in reporting covid numbers that could have helped save lives so I don’t think they are going to report their true cost.
That said, money talks and the tech names got hit on the news.
Not all.
A company like CRM stands to benefit from cheaper AI costs and the stock responded positively.
NVDA led the charge down but another sector that got clobbered was the nuclear stocks.
- SMR went from 29 to 19.
- OKLO went from 43 to 29.
- URA went from 31 to 27.
Full disclosure, I’m not a nuclear physicist and I don’t know what this really means for nuclear stocks.
But I’m a trader and I play price action. The fact that the stocks didn’t come back a little isn’t great.
Even the quantum stocks rallied after NVDA’s Jensen Huang said they were still 15 or 30 years away from having practical use.
So I’m not in buy the dip mode here.
I’ll hold my URA which was already protected with a call sold against it and watch for new opportunities.
In the mean time – I’ll look for new and fresh ideas elsewhere.
My friend Tim Biggam is unbelievable at identifying unusual option activity and the opportunities that go with it. That’s what I’m in the mood for now.
Less news and more high quality price action!
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