ChatGPT Moment For Robotics Is Around The Corner Says Nvidia CEO

To gain an edge, this is what you need to know today.

Stay Ahead Of The Curve

An enlarged chart of NVIDIA Corp NVDA.

Note the following:

• This article is about the big picture, not an individual stock.  The chart of NVDA stock is being used to illustrate the point. As full disclosure, NVDA is in The Arora Report’s ZYX Buy Model Portfolio.
• The chart shows NVDA stock is above the micro support zone.  Previously, this was a resistance zone.
• The chart shows that the move up has not been on heavy volume. This indicates a lack of conviction.
• Nvidia's CEO Jensen Huang gave the keynote address at the Consumer Electronics Show (CES) yesterday evening.
• The momo crowd ran up NVDA stock ahead of, during, and after Huang's presentation, pushing NVDA stock to a new all time high.
• Here are the key points from Huang's presentation:
  • The ChatGPT moment for robotics is around the corner.
  • Nvidia plans to release a personal AI supercomputer for AI data scientists and researchers, so they do not need to connect to AI data centers.  The personal AI supercomputer is called Project DIGITS and will have a Blackwell AI chip.
  • New Nvidia graphics chips for gamers will be available later this month.  The chips leverage AI to enhance resolution and frame rates.
  • Nvidia will offer AI blueprints, making it easier to use AI agents for a variety of tasks such as generating blog posts and analyzing video.
• A fortune is to be made in AI all the way to 2030.  It is not going to be in a straight line.  At times it will be treacherous.  It is important to build your investing knowledge in AI.  The problem you face is that much of the information available about investing in AI is not objective and not in your best interest.
• Total insanity is prevailing in robotics stocks.  Robotics stock valuations have become totally divorced from reality.  The momo crowd is in fantasy land and aggressively buying robotics stocks.  Here are the top stocks in the Arora robotics basket: Symbotic Inc SYM, Serve Robotics Inc SERV, iRobot Corp IRBT, Myomo Inc MYO, Aurora Innovation Inc AUR, Ouster Inc OUST, Microbot Medical Inc MBOT, Richtech Robotics Inc RR, Nauticus Robotics Inc KITT, Arbe Robotics Ltd ARBE, Kraken Robotics Inc KRKNF, Simpple Ltd SPPL, Lifeward Ltd LFWD, Accuray Inc ARAY, and Guardforce AI Co Ltd GFAI.  As full disclosure, there was a new signal on SYM given in The Arora Report’s ZYX Buy.
• JOLTS job openings will be released at 10am ET and may be market moving.

Magnificent Seven Money Flows

In the early trade, money flows are positive in Microsoft Corp and NVDA.

In the early trade, money flows are neutral in Amazon.com, Inc. and Alphabet Inc Class C .

In the early trade, money flows are negative in Tesla Inc,  Apple Inc , and Meta Platforms Inc.

In the early trade, money flows are positive in SPDR S&P 500 ETF Trust and Invesco QQQ Trust Series 1.

Momo Crowd And Smart Money In Stocks

Investors can gain an edge by knowing money flows in SPY and QQQ.  Investors can get a bigger edge by knowing when smart money is buying stocks, gold, and oil.  The most popular ETF for gold is SPDR Gold Trust.  The most popular ETF for silver is iShares Silver Trust .  The most popular ETF for oil is United States Oil ETF.

Bitcoin

Bitcoin is range bound.

Protection Band And What To Do Now

It is important for investors to look ahead and not in the rearview mirror.  The proprietary protection band from The Arora Report is very popular.  The protection band puts all of the data, all of the indicators, all of the news, all of the crosscurrents, all of the models, and all of the analysis in an analytical framework that is easily actionable by investors.

Consider continuing to hold good, very long term, existing positions. Based on individual risk preference, consider a protection band consisting of cash or Treasury bills or short-term tactical trades as well as short to medium term hedges and short term hedges. This is a good way to protect yourself and participate in the upside at the same time.

You can determine your protection bands by adding cash to hedges.  The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive.  If you do not hedge, the total cash level should be more than stated above but significantly less than cash plus hedges.

A protection band of 0% would be very bullish and would indicate full investment with 0% in cash.  A protection band of 100% would be very bearish and would indicate a need for aggressive protection with cash and hedges or aggressive short selling.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.

Traditional 60/40 Portfolio

Probability based risk reward adjusted for inflation does not favor long duration strategic bond allocation at this time.

Those who want to stick to traditional 60% allocation to stocks and 40% to bonds may consider focusing on only high quality bonds and bonds of five year duration or less.  Those willing to bring sophistication to their investing may consider using bond ETFs as tactical positions and not strategic positions at this time.

The Arora Report is known for its accurate calls. The Arora Report correctly called the big artificial intelligence rally before anyone else, the new bull market of 2023, the bear market of 2022, new stock market highs right after the virus low in 2020, the virus drop in 2020, the DJIA rally to 30,000 when it was trading at 16,000, the start of a mega bull market in 2009, and the financial crash of 2008. Please click here to sign up for a free forever Generate Wealth Newsletter.