AI meme names took some heat on Friday in a delayed reaction to Nvidia (NVDA) earnings Wednesday after the close. The sector again came under scrutiny on Friday when big-stock Chinese E-Commerce name Alibaba (BABA) reported earnings Friday before the open. BABA is a bit like Amazon.com (AMZN) as it is part e-commerce, part tech, and its earnings report revealed a new AI chip that is allegedly being designed to be more versatile than BABA’s previous chips and to be compatible with NVDA’s software ecosystem, allowing developers to easily adapt code written for NVDA hardware.
That had AI-related techs reeling following a relatively inert response to Wednesday's NVDA earnings report on Thursday. While BABA posted a buyable gap-up (BGU) with an intraday low of 128.88, NVDA busted 20-dema support to trigger a short-sale entry at the line on a third day of heavy selling volume.
Amid all this on Friday, the core services PCE Price Index accelerated to +0.36% (+4.4% annualized) in July from June, the third month in a row of acceleration. The increase was driven by non-housing services as rents continued to decelerate. Overall, the three–month core services PCE price index accelerated to an annualized 3.1% while the six-month index accelerated to an annualized 3.3%. Headline PCE inflation came in at 0.2%, mitigated by a 0.11% decline in Durables PCE inflation, which was surprising since durables are more susceptible to tariff effects.
Major market indexes sold off across the board, with the NASDAQ 100 Index taking the brunt of the selling as AI-related names were hit, closing below 20-dema support . closing below moving average support. The NYSE Composite was the best-performing indexes on Friday as it held tight, down only -0.06% on the day. Volume was roughly flat on both exchanges.
Crypto miner turned AI data center infrastructure provider
IREN Ltd. (IREN), which we have previously discussed, was one bright spot in the AI space on Friday. The company reported earnings on Thursday after the close and blew out 20-cent earnings estimates by coming in with earnings of 70-cents on a sizable 255% increase in sales growth. That led to a buyable gap-up move that stalled sharply off the highs but which remains in force using the 25.62 intraday low, 3.24% below Friday's 26.48 close, as a selling guide.
Gold Futures posted an all-time high on Friday as COMEX Gold printed $3,518.50 an ounce. This led to a breakout in the
SPDR Gold Trust (GLD) to all-time highs. We have previously noted the constructive action in gold and the GLD on the weekly chart as it continued to tighten up in bullish fashion.
Silver broke out Friday to a new 13.5-year high as COMEX Silver Futures ended the week at $40.75 an ounce while Spot Silver ended the week at $39.74 an ounce. The
iShares Silver Trust (SLV) traded strong volume on Friday's breakout and remains within buying range, although we have previously discussed this as a long entry lower in the pattern.
Gold and silver miners are mostly extended at this point, but we have discussed many of these names previously as they have trended higher. Of those that we follow, only
AngloGold-Ashanti (AU) is showing a real-time long entry set-up, a pocket pivot off the 10-dma on Friday. It closed Friday 3.8% above the 10-dma, so any pullbacks of 1% or more, closer to the 10-dma, might offer better entries from here, if you can get them.
Bitcoin ($BTCUSD) is once again acting like an AI tech stock as it continues to trend lower since posting a double-top short-sale (DTSS) entry trigger in mid-August on a failed breakout attempt to new highs. $BTCUSD was hammered on Friday and as of Sunday evening is showing a small rebound over the Labor Day Weekend, so far.
The Market Direction Model (MDM) remains on a BUY signal.
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