Debt Ceiling Raised - Time for TQQQ to soar $40 and beyond!
Tentative agreement have been reached to raise the debt ceiling. But it will be sometimes before legislative agreement to be put in place.
With the recent strong gains by Tech stocks fueled by A.I. boom catalyzed by Nvidia (NVDA) strong earnings.
How can we capture this opportunities? I would look at investing or trading in $Nasdaq100 Bull 3X ETF(TQQQ)$
Who are Top 10 Holdings of TQQQ and how they could contribute to TQQQ uptrend
Here are the top 10 holdings which will contribute how TQQQ performs. In next section, we will see how TQQQ have perform over the last week during the strong tech showing because of A.I. boom due to Nvidia(NVDA).
I will be looking at these companies in particular, Microsoft(MSFT), Amazon(AMZN), Alphabet(GOOGL).
TQQQ Performance During the Strong Tech Showing
If we look at the past week on how TQQQ have been trading, we might be able to find some clues on whether TQQQ will continue to soar this week.
Nvidia is held in 361 ETFs, the fifth most-widely held stock, according to ETF.com data.
24 May 23 (see 1)
Investors are waiting for Nvidia (NVDA) earnings report announcement which is after market close. As you can notice, TQQQ is trading rather sideway till 25 May 23. There was a huge gap up after hours for Nvidia (NVDA) on 24 May 23.
25 May 23 (see 2 and 3)
TQQQ gap up once market open on 25 May, due to the good news brought upon by Nvidia (NVDA), NVDA is one of the holdings in TQQQ holding a percentage of 5.23%. But we also see GOOGL gap up when TQQQ and NVDA have good uptrend. But we need to be careful to determine if $Alphabet(GOOGL)$ has helped TQQQ to gain an uptrend.
I would look at another stock, $Microsoft(MSFT)$ which also have gap up on 25 May 2023, because they are benefitting from the A.I. boom.
These 2 stocks could only partly explain why we have TQQQ having a good uptrend, I would look at the following day.
As we can see GOOGL does have a uptrend gain, but it is not as strong as MSFT, this could mean that MSFT might have a better competitive advantage in terms of capturing the A.I. computing market.
Not forgetting another important player in the A.I. computing market, Amazon(AMZN) it does not enjoy the same gap up after Nvidia(NVDA) announced their earnings. But they do have a good run uptrend on 26 May 23.
26 May 23 (see 4 and 5)
TQQQ begin to go back to norm, after the surge on 25 May 23, it was still trading with a good uptrend which has TQQQ close more than 7.5% positive on 26 May 23.
If we go through how the stocks in its holdings are trading, GOOGL, MSFT and AMZN have a good gains as well on Friday(26 May 23).
This could help TQQQ to gain more than 7.5% on 26 May 23.
Summary
If these 3 Cloud stocks continue to soar this week, I think we can see TQQQ reaching above $40 and beyond this week.
The demand for A.I. computing infrastructure will only be increasing and more and more companies will be adjusting their budget to prepare for the second half of 2023.
This would help 3 of these A.I. computing stocks to increase their customer base, no one companies would take the risks by putting all their services into one company.
So mostly 2 of these A.I. computing stocks would benefit from this demand.
Appreciate if you could share your thoughts in the comment section what do you think of TQQQ reaching $40 and beyond?
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@TigerStars appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.
Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.
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