Now the US stock market is quite interesting.
among the S&P 500 companies that have already released earnings,
About 85% of profits beat market expectations.
What a normal understanding would suggest is:
Good earnings
↓
Strong corporate profit-making ability
↓
Stocks continue to rise
And the S&P 500 really has just hit a fresh record.
but on Friday, it fell back from the highs,
ending at 7,785.76 points.
so the real question now is no longer:
“Are US companies making money?”
Rather—
With such a high stock price,
will we be able to keep making more than what the market expects in the future?
Why were earnings this round so strong?
At the core, it's AI.
Google, Amazon, Microsoft, and other large tech companies,
Cloud computing and AI business will continue to drive growth.
This year, large tech companies are expected to spend more than $700 billion on AI-related capital expenditures.
So this market cycle is forming a loop:
Increasing AI investment
↓
Rising demand for chips, data centers, and cloud computing
↓
Revenue growth at tech companies
↓
Profits keep beating expectations
↓
The market is willing to assign even higher valuations
That’s also why J.P. Morgan has
raised its S&P 500 target by the end of 2026 to 8000.
But—
The most dangerous part right now is exactly here.
Applied Materials’ latest guidance clearly points to solid performance,
yet the stock price fell by 5.1%.
Broadcom also fell by nearly 6%.
Why?
It’s not that the companies have become worse.
Instead:
Market expectations are already too high.
At this stage,
“good earnings” alone isn’t enough anymore,
It must be:
Very good + guidance is even better
so it can keep going up.
📍Which industries will I keep focusing on?
First: AI infrastructure
Semiconductors, data centers, cloud computing, storage, and the power grid.
As long as AI-related capital expenditures don’t show a clear slowdown,
this main theme hasn’t ended yet—at least for now.
Second: Energy
The risk in the Strait of Hormuz has pushed oil prices back up,
On Friday, the S&P energy sector actually rose by about 1.4%.
If oil prices keep staying high,
energy stocks may continue to benefit.
Third: Don’t mindlessly chase overvalued tech stocks
Right now, the biggest problem for tech stocks isn’t poor performance,
Instead:
and the good news has already been priced in by the time the price moves.
📍Then what about crypto?
This is exactly the part I think the crypto community should pay the most attention to.
Before posting, I recalculated by cross-checking the quotes again:
BTC is currently about $63,060,
OKX’s quotes are basically in line with Kraken’s.
US stocks:
Earnings are strong
+
Near historical highs
BTC:
yet it’s still hovering around 63K.
This suggests that global risk appetite isn’t actually bad right now,
But crypto hasn’t received new incremental capital as strong as that going into US stocks.
I’ll keep looking at BTC:
63K: First line of defense
62,700—62,850: Second support
Up ahead:
64K: Re-stabilization
65K: Clear strengthening—observe
If the S&P continues to challenge 8000,
But BTC can’t even get back above 64K,
That means capital still prefers to stay in US stocks.
How should ordinary investors allocate their assets?
I won’t chase all the tech stocks just because earnings beat expectations.
What’s even more suitable now:
Aggressive position:
High-quality AI and tech leaders with strong cash flow.
Defensive positions:
Assets such as gold and energy that hedge geopolitical and inflation risks.
Wait-for-entry position:
Keep cash and wait for high-valuation tech and BTC to pull back.
Because it’s not now:
“The market has no opportunities.”
It’s more like—
Good assets keep getting more expensive;
getting the buy-in location right matters more than choosing the direction.
Analyst Hengge’s view:
This quarter’s earnings have already proven:
US corporate profits aren’t having issues for now.
The real problem has turned into:
The market has already priced in such a high valuation,
can it still beat expectations next quarter?
So next I’ll mainly watch two signals:
Can the S&P truly hold above 7800 and challenge 8000?
and
Can BTC reclaim 64K?
If US stocks keep making new highs,
BTC will still be pinned around 63K,
So the next post we truly need to research is:
Why do people around the world prefer chasing US stocks instead of chasing crypto?
Now you’d rather allocate to:
AI tech stocks—or waiting for BTC’s next good dip entry?
Then, for the rotation between US stock earnings and BTC fund flows, I’ll keep following.