- Semiconductors just posted the strongest 4-week surge in history.
- There's broad participation, not just a handful of names.
- I'm looking for the next AI stock set to go supernova.
If you've been around markets this week, you've probably heard some version of the same argument: that AI has gone too far, that semiconductors are extended, and that this move can't possibly keep going.
It's a familiar narrative, and it tends to show up right when the price starts moving faster than people are comfortable with, when the shift from excitement to skepticism happens almost overnight.
The problem is that's not how trends end.
Bull markets end when there's no skepticism left, and everyone has already bought in.
And when you step back and focus on what the market is actually doing, what I'm seeing right now doesn't look like exhaustion.
It looks like an expansion.
At TrendLabs, we spend a lot of time studying the conditions that lead to accelerated moves, particularly the environments where demand overwhelms supply and price begins to move in ways that force participants to react.
These special situations result in the best vertical moves.
The Strongest Momentum Ever
The Semiconductors ETF (SMH) just closed the week at new all-time highs.
What's more, SMH just posted its strongest four-week rate of change in its entire history, narrowly surpassing the surge from April 2001:
That's the kind of momentum that leaves investors behind and forces them to chase.
And while most people look at a move like that and assume it must be unsustainable, markets don't top because demand is too strong.
If anything, that kind of behavior tends to show up much earlier in a move, not at the end of one.
When buyers are this aggressive, it usually means there are still participants who need to get in.
In other words, big moves begin with big moves.
And that's exactly what's happening here.
There's Still More Upside
Now zoom out...
SMH has been respecting its Fibonacci extensions throughout this advance, pausing and consolidating before continuing higher in an orderly way.
Based on that structure, the next upside target sits near $600, which still leaves meaningful upside potential from current levels:
More importantly, this isn't just a handful of leaders doing the heavy lifting.
Participation is expanding.
Former laggards are catching bids, and more stocks are contributing to the move.
That's exactly what you'd expect to see if a trend is strengthening rather than weakening.
The Comeback Nobody Expected
Then there's Intel (INTC)...
For years, this was a stock that investors had completely written off. It was stuck in a broken trend with no real interest from institutions.
Then the Trump administration stepped in with a 10% stake, followed shortly after by a multi-billion-dollar investment from Nvidia (NVDA), and everything started to change.
Now INTC is trading at all-time highs, with Trump's original position up more than 300%.
The chart structure suggests this move could go much further:
Intel is resolving a base that dates back to the dot-com bubble era.
As Louise Yamada taught me in technical analysis kindergarten, the bigger the base, the higher in space.
That doesn't guarantee the outcome, but it does tell you the conditions are in place for something much larger than most expect.
The bottom line is that I believe this AI trade is far from over.
In environments like this, the biggest opportunities tend to come from the hated names that haven't moved yet.
How To Catch the Next Big Winner
At TrendLabs, we run a system built around trading squeezes.
These are situations where positioning, price, and momentum all align to create the kind of vertical moves we've seen recently in names like Intel.
We just identified one of those setups this week.
This is a stock whose industry is being aggressively bet against by short sellers.
And it has the kind of upside potential that can turn into a parabolic move if the squeeze unfolds.
If you want to see it and get positioned early, you can check it out here.
Stay sharp,
Sam Gatlin
Analyst, TrendLabs
