Episode summary
Bubble Popping Now: ‘Unhinged’ Market Warning | David Nicoski
The David Lin Report
· · 37 min · Hosts: David Lin · Guests: David Nicoski
Summary
David Nicoski argued that the market’s leadership has shifted away from tech and that the pressure on AI names is likely to continue. He said the post-CPI move changed the tone of the tape, with investors rotating out of equities, especially high-beta tech, and into defensives and other oversold areas. In his view, the recent weakness in Meta, CoreWeave, the semiconductor complex, and data-center related names reflects not just valuation concerns but also tighter credit conditions and rising funding stress.
He was especially bearish on CoreWeave, saying its chart has broken down and that any rebound would be only a trade, not an investment. By contrast, he highlighted software names such as HubSpot, Monday.com, and Adobe as better technical setups because they are building bases and improving relative strength. He also said staples can work tactically, but he does not see them as long-term leaders unless the market turns “unhinged.”
Nicoski’s broader call was for a trading range in the S&P 500, with pressure remaining on the MAG 7 and AI-related hardware while energy and selected oil-services names stay attractive. He emphasized relative strength as the main tool for finding where money is actually flowing, and he preferred areas like Transocean, Schlumberger, and Halliburton over crowded tech exposures.
Key takeaways
- David Nicoski said the market’s tone changed after CPI, with money rotating out of tech and into defensive sectors and other oversold groups.
- He views the pressure on AI spending and data-center buildout as ongoing, pointing to weak credit spreads and rising funding strain in names like CoreWeave.
- He favors software over hardware in tech, citing HubSpot, Monday.com, and Adobe as stronger relative-strength setups.
- He expects the S&P 500 to stay in a trading range while the MAG 7 and broader tech remain under pressure.
- He is constructive on energy and oil services, especially Transocean, Schlumberger, Halliburton, and Weatherford.
- He said Tesla’s valuation is excessive and that the stock has underperformed the market by 50% since 2021.
Notable quotes
“I think the pressure on AI is going to continue”
“you know, I'm a technician, but when when you see that type of rotation out of a a mag seven name, um you know, you you break a lot of charts”
“I'm not bullish on core. It can get a bounce, but that's a trade. It's not a long-term investment”
“I would say, you know, even in staples, whether it's General Mills, Craft Hind, you know, Proctor and Gamble had a monster move”
“I think the pressure on AI is going to continue. Um I don't you know calling a V reversal is is you know like me getting a hole in one on a par4 course”
How the episode opens
I don't expect Staples to to lead unless this market were going to come, you know, unhanded. Markets, you know, crash from oversold levels. I think the pressure on AI is going to continue.
It's Friday, October 23rd, and it's mixed bag today in the stock markets. The Dow opened 500 points lower while dip buyers are testing the tech sector after the NASDAQ's worst day since June on Thursday. Chip stocks are bouncing this morning.
Is it time to buy the dip? That's the theme of our conversation with our next guest who's going to reveal to us which companies are worth bottom feeding, so to speak, and which still have a lot more downside. He's going to go over the technical indicators we should be watching to decide if something is worth buying the dip or not.
We'll also get his outlook on where the main stock indices and bonds are headed. David Akoski joins us. He's the chief investment officer of Vermilion Research.
In his last appearance on the show in September, he called a historic rotation between sectors, which is playing out exactly right now. And right now on Kosu, traders are predicting a 31% chance that the S&P 500 index will be above $8,000 before December 1st, 2026. A $50 trade on that outcome could yield $88 if you agree with those odds.
And you're right. This video is sponsored by Koshi, the largest prediction market in the United States. Unlike a sports book, you're trading peer-to-peer on real world events from economic data to political outcomes.
And the price moves based on public opinion, not a house. Go to the link in the description down below or scan the QR code here and use my code lin. New users who use my code can get $25 in app credits when they trade $25.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- tech stock selloff
- ai spending risks
- ai funding concerns
- sector rotation
- energy and oil opportunities
Companies and tickers mentioned
- TSLA
- CoreWeave
- Vermilion Research
- Tesla
Watch the episode
Watch “Bubble Popping Now: ‘Unhinged’ Market Warning | David Nicoski” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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The David Lin Report, this episode and its artwork belong to The David Lin Report. Octagon is not affiliated with the show; this page is an independent summary.
