AJB Capital
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AJB Capital
Garrett Baldwin and Scott Dunn explore alternative investment strategies, value and momentum strategies, tail-risk analysis, and behavioral finance. We take a highly quantitative approach to trading and investing and blend it with macroeconomic analysis and deep research. We also highly emphasis risk management practices. Long call/put, spread trading, value reversion, RSI/MFI reversions.
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Joined on 16th December 2025
Baltimore, Maryland
Quick read on where we sit heading into a fresh week.
Momentum is still strong across the board. We're pushing back toward the highs we saw on April 17th. The S&P, Nasdaq, and Russell are all aligned. On the surface, that should feel great.
The problem is what's underneath.
Tech is doing all the work. Industrials, utilities, defensives are flat. The TECL is overbought. The SOXL is overbought. Intel's RSI is at 87 with overbought normally considered 70. We've got a handful of semis doing 60% to 100% in a month while the rest of the market quietly trades sideways or slips. That's not a broad rally. That's a single industry pulling the index higher while everything else holds the line.
Goldman is now openly calling for a 3% to 5% flush. (That's your first sign to be long.)
Mechanical institutional selling was around $10 billion last week. Retail is buying every dip. So you've got the smart money lightening up while the dip buyers fund the rally. That's a setup that historically resolves one wa
Something worth noting about how the market is trading earnings this week.
Tesla beat last night and the stock is down 4%. IBM beat, down over 9%. ServiceNow beat and raised, down 17%. Three clean beats, three selloffs.
80% of the S&P 500 is beating estimates this season. When everyone beats, a beat isn't really a signal anymore. It's the baseline. Analysts keep moving the bar lower until everyone can walk over it. So the market is pricing the forward story now, not what you just earned.
Tesla is the cleanest example. Margins improved; FSD is scaling to 1.3 million paid customers; Optimus is ramping; and the AI5 chip is coming from a new Gigafactory Texas fab. That's the dream part.
Then Musk said capex is going substantially above $25 billion and free cash flow will be negative for the rest of the year. And buried in the call was the real bombshell. Tesla admitted HW3.0 vehicles do not have the capability for full self-driving. Every customer who bought a Tesla on the promise of that olde
Careful out there. We highlighted this spot on the VIX last week as the level to keep an eye on. The next level to watch is the 8-day on the FNGD. Above that, and trouble is returning.
