To The Moon

Last week (October 20-25), tech stocks staged a strong rebound. The $NASDAQ(.IXIC)$ closed at 25,358.16 points, gaining 1.04% for the week and successfully breaking through its all-time high. The first week of earnings season concluded with robust rebounds in leading stocks, Bitcoin rebounding to $110,000, and risk appetite reigniting. More crucially, AI policy signals from the U.S. government point directly to an accelerating supercycle. Tech giants have entered a dual-engine phase driven by "policy + seasonality," with the Nasdaq poised to test the 26,000-point threshold next week. $NASDAQ 100(NDX)$ $Invesco QQQ(QQQ)$

First, let's examine the market landscape.

Early last week, earnings season volatility hit hard. $IBM(IBM)$ plunged 8% before closing flat, while $Tesla Motors(TSLA)$ rebounded from lows to close at $433.65, posting a nearly 3% weekly gain. $Vertiv Holdings LLC(VRT)$ and $GE Vernova Inc.(GEV)$ surged over 15% the day after their earnings releases. Bitcoin gained more than 5% during the week, signaling a return of speculative sentiment as capital shifted from defensive to offensive positions. The rationale for adding to index ETF positions during Wednesday's pullback was straightforward: in the current environment, quality AI stocks have clear support levels. Should the 10-day moving average (around 24,800 points) be breached, immediately reduce exposure by 50%. Friday's continued 1.15% gain in the Nasdaq, fueled by positive macroeconomic news (CPI below expectations, favorable US-China negotiations), validated this flexible strategy.

Policy developments represent the greatest variable.

U.S. Energy Secretary Chris Wright urged the Federal Energy Regulatory Commission (FERC) to reduce data center grid access approvals to 60 days—far below previous years—effectively creating a "fast track" for AI infrastructure. Republican-led states are highly likely to follow suit, with data center capacity additions projected to exceed expectations by 20% in 2026—boosting AI energy stocks like BE and VRT (up 8% weekly). More significantly, the Commerce Department's "U.S. AI Export Initiative" introduces the first federal coordinated export framework, providing sustainable financing through EXIM and DFC to alleviate AI's "revolving financing" pain points.

NVIDIA's GTC conference kicks off Monday, with Jensen Huang's keynote expected to announce AI export partnerships. Middle Eastern sovereign wealth funds are among the first targets, which will serve as a catalyst for policy implementation. Overall, the government is shifting from a "bystander" to an "active player," accelerating the AI cycle beyond doubt. Should Trump's team invest $10 billion for a 10% stake in OpenAI (pushing its valuation over 10%), the entire ecosystem could experience explosive "climbing effects," making a Nasdaq surge to 27,000 by year-end entirely feasible. However, this scenario remains unlikely.

Seasonal factors are also in full swing.

Since 1928, the week ending in late October has been the best annual period for the S&P 500, averaging a 2.5% gain. Two months after the Fed cuts rates, the median stock market gain reaches 8%. Last week saw over $10 billion in retail fund inflows, with November set to amplify this trend. MacroCharts compares the 2000/2021 bubbles: AI semiconductor quality stocks (e.g., $NVIDIA(NVDA)$ $Advanced Micro Devices(AMD)$ will dominate, while meme stocks have already peaked. IBM surged 20% to a new high of $307.46 after its quantum computing division was unveiled, while RGTI and IONQ retreated 5% as capital shifted toward "substance over hype."

Last week's $Honeywell(HON)$ earnings report was a key focus, with the market debating its potential to become the next IBM. HON holds a 54% stake in Quantinuum yet remains undervalued—trading at just 1/7th of IBM's valuation—and fell 1% to $216.15 last week. Management stated in the earnings call that they are developing customized quantum solutions with clients like Cartan. Next month's GTC unveiling and business spin-off will drive a revaluation of the automation segment.

Earnings season reaches its peak, with next week's focus on mega-cap companies' capital expenditures.

$Meta Platforms, Inc.(META)$ 2026 operating expenses may rise due to off-balance-sheet financing, but advertising and AI partnerships remain stable; $Google (GOOG)$$Google A (GOOGL)$Google's TPU demand surges, Capex exceeds market expectations of $96 billion to reach $110 billion. Storage giants $Western Digital (WDC)$/$Seagate Technology (STX)$ face supply chain constraints this quarter, delaying growth by 2%, but 80% probability of exceeding expectations in 2026Q1. Significant upside potential in valuations—long positions recommended for $Micron Technology (MU)$/$SanDisk Corp (SNDK)$. Capital flows funding HDD short positions have emerged.

$Reddit(RDDT)$ rose 6% weekly to $214.20. User growth stabilizes, ChatGPT mentions rebound, strong revenue guidance, high probability of beating earnings expectations. Company views AI as goldmine: Reddit's UGC data is invaluable, Google/OpenAI licensing fees may exceed $500 million. Exposure rate rebounds from 2% to 15% in AI overviews, narrative shifts to "AI winner."

$Roblox Corporation (RBLX)$ may become a black box for earnings. Last week it fell 1% to $127.71, with Q3 booking growth forecasts diverging widely: Hedgeye at 75%, Opco at 53%, and consensus at 60%. Peak CCU figures are misleading, as monetization shifted from high-efficiency games to the less-efficient 99 Nights, dragging down revenue per hour. Yet mid-term positives remain substantial: ad expansion, Shop/Google partnerships, and algorithm optimization. With GTA VI comparisons looming in Q2 2026, leveraging options positions to hedge is a sound strategy.

This week, tech stocks are poised for an unquestionable rally, with the Nasdaq 26,000 serving as the baseline target. The GTC conference and policy implementation are fueling the AI sector, while retail capital and seasonal factors are adding momentum. A Bitcoin break above $120,000 will amplify leverage. However, historical bubble comparisons serve as a warning: before quality stocks take the lead, be wary of speculative pullbacks—if the Nasdaq breaks below 24,800, reduce exposure to a defensive stance. AI is not a bubble; it represents a geopolitical and productivity revolution, with government involvement accelerating everything.