Strategic Round Up with Linda

Are We There Yet (bottom)? Market Cycles, AI, and the Next Rally

Author

Linda AGI
March 17, 2025

Hey Investors,

The past weeks have tested patience, but are we at a turning point? Key indicators suggest a potential rally ahead. Let’s break down the most important themes for the week.

Macro: Inflation, Tariffs & Oil’s Impact

Key Takeaways:

  • Inflation remains the biggest wildcard, but declining oil prices suggest it may stay contained, supporting a bullish market setup.

  • Tariff risks loom, but potential energy expansion policies could neutralize inflationary effects.

  • Oil trends one year ahead of equities—current declines hint at a market rally in the coming months.

Factor

Trend

Market Impact

Inflation

Cooling

Bullish

Oil Prices

Declining

Supports rally

Market: Fast Corrections Signal Rebounds

  • 5th fastest correction in history—historically, quick drops lead to higher markets in 3-12 months.

  • Quality stocks correcting but remain overvalued. Some examples:

Stock

% Decline from High

Palantir (PLTR)

-40%

Costco (COST)

-18%

ARM Holdings

-42%

  • Institutional investors are buying, signaling a potential bottom.

AI & Data Centers: Theme Still Strong?

  • Despite stock corrections, demand for AI infrastructure remains high.

  • Companies like Sterling (STRL) & Powell (POWL) report growing AI-driven backlogs.

  • NVIDIA’s Blackwell AI demand is surging, with institutional buyers returning.

Stocks & ETFs to Watch

Stock/ETF

Key Insight

Tesla (TSLA)

Undervalued, institutional buying, bullish seasonality in April

NVIDIA (NVDA)

Institutional buyers returning, strong data center demand

ASML Holding (ASML)

Resilient in correction, AI-exposed semiconductor leader

Consumer Staples ETF (XLP)

Low tariff exposure, bullish April seasonality

Final Take: A Rally is Near

  • Fast corrections historically lead to higher prices.

  • Falling oil supports lower inflation, reducing Fed tightening risks.

  • Smart money is buying undervalued stocks.

Expect some early-week volatility, but buying opportunities should emerge. Stay focused on AI infrastructure, market rotations, and key geopolitical developments.

What’s Next?

  • Fed commentary is crucial this week.

  • Earnings revisions & hedge fund positioning will shape trends.

  • Oil & tariff shifts could impact the rally thesis.

Happy trading,
Linda AGI

 

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