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November 16, 2024

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Spotting a Bullish Opportunity in Zscaler (ZS) with OptionsPlay Strategy Center

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As the cybersecurity landscape continues to evolve with increasing digital threats, Zscaler, Inc. (ZS) stands out as a new opportunity after lagging for most of 2024. Recent chart setups in Zscaler stock suggest ZS may be gearing up for a significant bullish trend.

In this analysis, we will break down the bullish signals and Zscaler’s financials, and then outline an optimal options strategy you can apply to capitalize on this opportunity—all identified instantly using the OptionsPlay Strategy Center within StockCharts.com. We’ve included a video illustrating this tool at the end of this article, which will help you get a better idea of how you can apply it to your options trading.

FIGURE 1. DAILY CHART OF ZSCALER. The stock price has broken out above a significant resistance level, and its performance relative to the S&P 500 is improving.Chart source: StockCharts.com. For educational purposes.

Looking at the daily chart of ZS, there are several bullish factors:

  • Breakout Above Major Resistance. After trading below $200 since March, ZScaler’s stock price has recently completed a bottoming formation and broke out above this critical resistance level. The prolonged consolidation period below $200 formed a solid base, indicating that selling pressure has subsided with buyers gaining control.
  • Market Outperformance. Relative to the S&P 500 ($SPX), ZS’s performance has been improving, suggesting relative strength and increased investor interest in the stock.

These technical factors collectively point towards a potential continuation higher after breaking out above this key $200 resistance level.

Beyond the technicals, Zscaler’s fundamentals further strengthen the bullish thesis:

  • Robust Revenue Growth. Zscaler reported a 30% year-over-year increase in revenue, reaching $593 million.
  • Impressive Billings Increase. The company achieved a 27% growth in billings, totaling $911 million.
  • Expanding Customer Base. Zscaler now serves 567 customers with over $1 million in annual recurring revenue (ARR)—a 26% increase—and 3,100 customers with over $100,000 in ARR, marking a 19% growth.
  • High Gross Margin. Maintaining a non-GAAP gross margin of 81% for fiscal year 2024 showcases the company’s operational efficiency and profitability.
  • Strong Free Cash Flow. With a free cash flow margin of 27%, Zscaler demonstrates robust cash generation capabilities, providing financial flexibility for future investments and growth initiatives.

Zscaler’s strong financial performance highlights its potential for continued growth. The company’s focus on innovation and the expansion of its Zero Trust Exchange platform positions it well to capitalize on the increasing demand for cloud-based security solutions.

Options Strategy

To leverage this bullish outlook on ZS, the OptionsPlay Strategy Center suggests selling the Dec 27 $205/190 Put Vertical @ $5.60 Credit.

  • Sell. December 27 $205 Put Option at $12.15
  • Buy. December 27 $190 Put Option at $6.60

This strategy involves selling a higher strike put and buying a lower strike put, resulting in a net credit of $5.60 per share, or $560 per contract. The trade profits if ZS stays above $199.40 by the December 27, 2024 expiration date, with a 56.92% probability of success.

FIGURE 2. PUT VERTICAL RISK GRAPH. Here, you see the max reward, max risk, and other details of the trade.Image source: StockCharts.com. For educational purposes.

Trade Details:

  • Maximum Potential Reward. $560 (the net credit received)
  • Maximum Potential Risk. $1,880 (difference in strike prices multiplied by 100 shares per contract, minus the net credit)
  • Breakeven Point. $199.40 (strike price of the sold put minus the net credit per share)

This strategy benefits from time decay and allows for profit even if the stock remains stagnant or rises moderately. It provides a favorable risk-to-reward ratio while aligning with the bullish outlook on ZS.

Real-Time Trade Ideas With OptionsPlay Strategy Center

This bullish opportunity in Zscaler was identified using the OptionsPlay Strategy Center within StockCharts.com. The platform automatically scanned the market, highlighted ZS as a strong candidate for a continuation higher, and structured the optimal options trade in real-time.

FIGURE 3. APPLYING THE OPTIONSPLAY STRATEGY CENTER. ZS was identified as a stock that has potential for a continued move higher. Click the arrow to the left of the stock symbol to view the trade details.Image source: StockCharts.com. For educational purposes.

By subscribing to the OptionsPlay Strategy Center, you can access:

  • Automated Market Scanning. Effortlessly discover the best trading opportunities based on comprehensive technical and options strategies in real time.
  • Optimal Trade Structuring. Receive tailored options strategies that align with your market outlook and risk tolerance.
  • Time-Saving Insights. Save hours of research with actionable trade ideas delivered in real time, allowing you to make informed decisions swiftly.

Don’t let valuable trading opportunities pass you by. Subscribe to the OptionsPlay Strategy Center today and empower your trading journey with tools designed to keep you ahead of the market. Access real-time trade ideas like the one discussed in this article and find the best options trades within seconds daily. Let OptionsPlay be your partner in navigating the markets efficiently and effectively.

Learn more about the OptionsPlay Strategy Center features and how to apply them to your trading in the video below!

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Are the Magnificent 7 Still the Kings of Wall Street?

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There’s no denying the strength that the mega-cap growth names have exerted on the equity markets in 2024. With their outsized weight in the major equity averages, and their strong performance into November 2024, the Magnificent 7 stocks in many ways reflect the investor optimism that has been much of the story of this bull market. But with these leading growth names rotating lower this week, pushing the Nasdaq 100 down 3.4% and the S&P 500 down 2.1% through Friday’s close, we need to reconsider the sustainability of the uptrend phase through year-end 2024.

To examine more effectively, we can easily group the eight stocks, which I call the “Magnificent 7 and Friends”, into three distinct buckets. Let’s review the technical configurations for these stocks, and focus on what levels could help us confirm a new market trend.

The Breakout Names, Featuring NVDA

Three of these eight leading growth names have already broken to a new all-time high in Q4, and, while Netflix, Inc. (NFLX) and Amazon.com, Inc. (AMZN) both deserve our attention, I think the chart of NVIDIA Corp. (NVDA) perhaps best illustrates what we’re seeing with these top performers.

These three are in confirmed uptrends, as defined by Charles Dow’s original definition of higher highs and higher lows. So the analysis here is simple: as long as that uptrend persists, the charts are in good shape. For NVDA, that means a “line in the sand” around $132, which lines up with late October swing low as well as the 50-day moving average.

During an uptrend phase, stocks will often pull back to an ascending 50-day or 10-week moving average. So, if charts like Nvidia are able to hold this key short-term trend barometer, then the uptrend remains in place. However, if these first three stocks fail to hold expected support, that could provide a key market tell as the “generals” would show signs of weakness.

The Consolidating Charts, Featuring AAPL

Three of the eight charts on this list are testing short-term resistance levels, with Meta Platforms, Inc. (META) testing the $600 level as a prime example. But we’ll focus today on Apple, Inc. (AAPL), which has spent the last four months failing to breakout above its July high around $237.

Quite simply, the chart of AAPL is at best “neutral” until and unless it can demonstrate a confirmed break above the July peak. On top of that, we can see the RSI has failed to push above the 60 level on short-term rallies. In fact, with the RSI basically rangebound between 40 and 60, this stock represents an absence of momentum and an equilibrium of buyers and sellers.

For charts like these, I’m reminded of Jesse Livermore’s famous quote, “There is time to go long, time to go short, and time to go fishing.” When the chart is not providing a clear signal to the upside or downside, it’s usually best to find opportunities elsewhere. But if three of these stocks are failing to break to new highs, that suggests limited upside for the S&P 500 and Nasdaq 100.

The Wild Cards, Featuring MSFT

Now the final two charts are sort of in an “other” bucket, with Tesla Inc. (TSLA) a notable outlier with its exceptionally strong upside rally post-elections, and then an equally dramatic decline over the last week. But I think Microsoft Corp. (MSFT) provides a more compelling technical configuration, given that it’s one of the only growth names on this list that is actively testing price support.

If you connect a trendline from the July peak to the September high, you’ll see that MSFT had a failed breakout above that trendline in late October, and then again earlier this week. In bullish market phases, charts like this usually follow through on breakouts. But when clear technical breakouts don’t see enough follow-through, that can often be an indication of a wider risk aversion and lack of willing buyers.

With Microsoft in particular, it’s all about the $406 level, which represents a 38.2% retracement of the 2023-24 uptrend phase. There have been numerous tests of this support level over the last three months, and a break below this level could indicate a larger theme of distribution in the equity markets. Bear phases are always marked by stocks being unable to hold key price support!

For a deeper dive into these three charts, along with the rest of the Magnificent 7 and Friends, head on over to my YouTube channel!

RR#6,

Dave

P.S. Ready to upgrade your investment process? Check out my free behavioral investing course!

David Keller, CMT

President and Chief Strategist

Sierra Alpha Research LLC

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.

The author does not have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author and do not in any way represent the views or opinions of any other person or entity.

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Biotechs Fall Apart with Dark Cross Neutral Signal

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(This is an excerpt from the subscriber-only DP Weekly Wrap for Friday)

On Friday, the Biotechnology ETF (IBB) 20-day EMA crossed down through the 50-day EMA (Dark Cross) and above the 200-day EMA, generating an IT Trend Model NEUTRAL Signal. IBB recently switched to a BUY Signal on Friday November 8, and we said at the time, “IBB is approaching the top of a four-month trading range (resistance), so this BUY Signal doesn’t look very juicy at this time.” This emphasizes why we consider Trend Model signals to be information flags, not action commands. Always check the chart.

Part of the reason Biotechs fell apart was the nomination of Robert F. Kennedy Jr. to the Health and Human Services department. He is known to be anti-COVID vaccines and just generally not a fan of chemicals for the body. This doesn’t necessarily bode well for this industry.

Participation has been plummeting as more and more stocks lose support at key moving averages. This drop below the 200-day EMA is perilous and, given the negative indicators, the decline isn’t likely over yet. The PMO is dropping below the zero line on a Crossover SELL Signal and Stochastics are below 20, signaling extreme weakness. Support is arriving around 130.00, but it doesn’t look good.

The weekly chart shows the breakdown from the rising wedge formation, which is the normal resolution from this formation. The weekly PMO is tumbling lower. Support on the weekly chart is around 123.00. That would be a painful decline added to this already deep decline.

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Technical Analysis is a windsock, not a crystal ball. –Carl Swenlin

(c) Copyright 2024 DecisionPoint.com

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

DecisionPoint is not a registered investment advisor. Investment and trading decisions are solely your responsibility. DecisionPoint newsletters, blogs or website materials should NOT be interpreted as a recommendation or solicitation to buy or sell any security or to take any specific action.

Helpful DecisionPoint Links:

Trend Models

Price Momentum Oscillator (PMO)

On Balance Volume

Swenlin Trading Oscillators (STO-B and STO-V)

ITBM and ITVM

SCTR Ranking

Bear Market Rules

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Tech Stocks Plunge: What This Means for Investors

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“The economy is not sending any signals that we need to be in a hurry to lower rates.” These words from Chairman Powell impacted the stock market much more than this week’s inflation data.

The stock market started selling off on Thursday afternoon and continued to do so Friday, with the broader stock market indexes closing lower. The Dow Jones Industrial Average ($INDU) closed down by 0.70%, the S&P 500 lower by 1.32%, and the Nasdaq Composite ($COMPQ) lower by 2.2%.

It’s also options expiration Friday, which generally means increased volatility. The Cboe Volatility Index ($VIX) gained 12.79% on Friday, closing at 16.14. That’s a big jump from earlier in the week.

Nasdaq’s Fierce Selloff

The Nasdaq experienced the biggest drop of the three indexes. The chip makers got smoked. Applied Materials (AMAT), the largest US chipmaker, was down 8.76% on a disappointing revenue forecast. Nvidia (NVDA) was down over 3%, Micron Technology (MU) was down almost 3%, and Intel (INTC) fell 1.70%.

The daily chart of the VanEck Vectors Semiconductor ETF (SMH) gives a clear picture of the semiconductor industry.

FIGURE 1. DAILY CHART OF THE VANECK VECTORS SEMICONDUCTOR ETF (SMH). The sharp selloff in semiconductor stocks resulted in a technical weakness in the chart of SMH. It’s close to a support level, while its SCTR score, MACD, and relative strength with respect to the S&P 500 weaken.Chart source: StockChartsACP. For educational purposes.

Although SMH is still within the sideways range (grey rectangle), it’s very close to the bottom of the range, which aligns with the 200-day simple moving average (SMA). The StockCharts Technical Rank (SCTR) score is at a low 29, the moving average convergence/divergence (MACD) indicates a lack of momentum, and SMH is not outperforming the S&P 500 like it once did.

Looks like investors are rotating away from semiconductors, either taking profits or investing in other asset classes — but which ones? It’s certainly not healthcare stocks, which also got pounded on Friday. Perhaps cryptocurrencies. However, there’s more brewing beneath the surface.

The Yield Rally

The economy is still strong—retail sales data shows that consumers continue to spend, which is pushing Treasury yields higher. The 10-year US Treasury Yield Index ($TNX) closed at 4.43% (see daily chart below). TNX has been trending higher since mid-September and since the end of September has been trading above its 20-day SMA.

FIGURE 2. DAILY CHART OF THE 10-YEAR US TREASURY YIELD. Treasury yields have been on a relentless yield since September. A stronger US economy would keep yields higher.Chart source: StockChartsACP. For educational purposes.

Fed Chairman Powell and Boston Fed President Susan Collins’ comments lowered the probability of a 25-basis-point interest rate cut in the December FOMC meeting. According to the CME FedWatch Tool, the probability is now 58.2%. It was close to 70% on Thursday, before Powell’s speech.

The relentless yield rally may have been one reason the Tech sector sold off. Higher yields don’t benefit growth stocks.

Dollar’s Roaring Rally

One asset class that is gaining ground is the US dollar. When the words “Dollar sets 52-week high” appear in my predefined alerts dashboard panel, it’s something to analyze. The US dollar ($USD) has been in a relatively steep rally since October (see chart below). With a strong US economy and the Fed indicating a more neutral stance in their policy decisions, the dollar could continue to strengthen.

FIGURE 3. DAILY CHART OF THE US DOLLAR. The dollar has been in a roaring rally since October. A strong US economy supports a strong dollar.Chart source: StockChartsACP. For educational purposes.

At the Close

With the exception of the Dow, the other broader indexes have fallen to the lows of November 6, the day after the US presidential election. The broad-based selloff could continue into early next week. There’s not much economic data for next week, but Nvidia will announce earnings after the close on Wednesday. That should shake up the chip stocks.

If you have cash on the sidelines, there could be some “buy the dip” opportunities. However, because there are some dynamics between stocks, yields, and the US dollar, the three charts should be monitored to identify signs of a reversal. When you’re confident of a reversal, jump on board.

If you want to be notified of new articles published in the ChartWatchers blog, sign up on this page.

End-of-Week Wrap-Up

  • S&P 500 down 2.08% for the week, at 5870.62, Dow Jones Industrial Average down 1.24% for the week at 43,444.99; Nasdaq Composite down 3.15% for the week at 18,680.12
  • $VIX up 8.03%% for the week, closing at 16.14
  • Best performing sector for the week: Financials
  • Worst performing sector for the week: Health Care
  • Top 5 Large Cap SCTR stocks: Applovin Corp. (APP); Palantir Technologies (PLTR); Summit Therapeutics (SMMT); MicroStrategy Inc. (MSTR); Redditt Inc. (RDDT)

On the Radar Next Week

  • October Housing Starts
  • November Michigan Consumer Sentiment
  • Fed speeches
  • Nvidia earnings

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.

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Don’t Miss These Breakouts Poised to Trade Higher!

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In this StockCharts TV video, Mary Ellen reveals what took place last week and how the markets closed. She also revealed what drove price action, and what to be on the lookout for next week. In addition, she shares several stocks that broke out of powerful bases on bullish news.

This video originally premiered November 15, 2024. You can watch it on our dedicated page for Mary Ellen on StockCharts TV.

New videos from Mary Ellen premiere weekly on Fridays. You can view all previously recorded episodes at this link.

If you’re looking for stocks to invest in, be sure to check out the MEM Edge Report! This report gives you detailed information on the top sectors, industries and stocks so you can make informed investment decisions.

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Element79 Announces Closing of First Tranche of Non-Brokered Private Placement

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(TheNewswire)

VANCOUVER, BC – The N ewswire – November 15, 2024 Element79 Gold Corp. (CSE: ELEM) (OTC: ELMGF) (FSE: 7YS) (‘Element79’, or the ‘Company ‘) announces it has closed the first tranche of its previously announced non-brokered private placement (the ‘Private Placement’) for aggregate gross proceeds of $500,024. Pursuant to the Private Placement, the Company has issued 5,000,240 units (each, a ‘Unit’) at a price of $0.10 per Unit. Each Unit will consist of one (1) common share (each, a ‘Share’) and one (1) common Share purchase warrant (each, a ‘Warrant’). Each Warrant is exercisable into one (1) Share at an exercise price of $0.15 until November 14, 2026. The Company will not be subjecting the warrants to an acceleration clause.

The remainder of the Private Placement may close in one or more additional tranches.  The Company intends to use a portion of the proceeds raised from the Private Placement Element79 will use the net proceeds from the Offering with a targeted 70% to be invested into its mining projects in Peru and Nevada, 15% for corporate operations/audit and 15% to Investor Relations/Marketing . The securities issued under the Private Placement will be subject to a statutory hold period in accordance with applicable securities laws of four months and one day from the date of issue, expiring March 15, 2025. No finder’s fees will be paid in connection with the Private Placement.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the U.S. Securities Act of 1933, as amended (the ‘1933 Act’), or under any U.S. state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the 1933 Act and applicable state securities laws.

About Element79 Gold Corp.

Element79 Gold is a mining company with a focus on exploring and developing its past-producing, high-grade gold and silver mine, the Lucero project located in Arequipa, Peru, with the intent to restart production at the mine and through reprocessing its tailings, in the near term.

The Company holds a portfolio of four properties along the Battle Mountain trend in Nevada, and the projects are believed to have significant potential for near-term resource development. The Company has retained the Clover project for resource development purposes and signed a binding agreement to sell three projects with a closing date on or before November 30, 2024.

The Company also holds an option to acquire a 100% interest in the Dale Property, 90 unpatented mining claims located approximately 100 km southwest of Timmins, Ontario, and has recently announced that it has transferred this project to its wholly owned subsidiary, Synergy Metals Corp, and is advancing through the Plan of Arrangement spin-out process.

For more information about the Company, please visit www.element79.gold

Contact Information

For corporate matters, please contact:

James C. Tworek, Chief Executive Officer

E-mail: jt@element79.gold

For investor relations inquiries, please contact:

Investor Relations Department

Phone: +1.403.850.8050

E-mail: investors@element79.gold

Cautionary Note Regarding Forward Looking Statements

This press contains ‘forward‐looking information’ and ‘forward-looking statements’ under applicable securities laws (collectively, ‘forward‐looking statements’). These statements relate to future events or the Company’s future performance, business prospects or opportunities that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management made considering management’s experience and perception of historical trends, current conditions and expected future developments. Forward-looking statements include, but are not limited to, statements with respect to: the Company’s business strategy; future planning processes; exploration activities; the timing and result of exploration activities; capital projects and exploration activities and the possible results thereof; acquisition opportunities; and the impact of acquisitions, if any, on the Company. Assumptions may prove to be incorrect and actual results may differ materially from those anticipated. Consequently, forward-looking statements cannot be guaranteed. As such, investors are cautioned not to place undue reliance upon forward-looking statements as there can be no assurance that the plans, assumptions or expectations upon which they are placed will occur. All statements other than statements of historical fact may be forward‐looking statements. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives or future events or performance (often, but not always, using words or phrases such as ‘seek’, ‘anticipate’, ‘plan’, ‘continue’, ‘estimate’, ‘expect’, ‘may’, ‘will’, ‘project’, ‘predict’, ‘forecast’, ‘potential’, ‘target’, ‘intend’, ‘could’, ‘might’, ‘should’, ‘believe’ and similar expressions) are not statements of historical fact and may be ‘forward‐looking statements’.

Neither the Canadian Securities Exchange nor the Market Regulator (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release.

Copyright (c) 2024 TheNewswire – All rights reserved.

News Provided by TheNewsWire via QuoteMedia

This post appeared first on investingnews.com

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Exclusive Interview with Forward Water Technologies CEO Howie Honeyman

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In a recent interview, Forward Water Technologies (TSXV:FWTC) CEO Howie Honeyman said the company plans to accelerate adoption of its water treatment technology through successful demonstrations and results from on-site projects.

Forward Water’s innovative approach to water treatment has the potential to fundamentally alter how industries manage wastewater with high brine content, offering a low-energy, cost-effective alternative, according to Honeyman.

This low-energy consumption not only minimizes operational costs, but also significantly reduces environmental footprints, paving the way for more sustainable water management practices, he said. The implications are crucial for industries keen on reducing their carbon footprint while maintaining efficiency in operations.

Watch the full interview with Howie Honeyman, CEO of Forward Water Technologies.

This post appeared first on investingnews.com

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Exclusive Interview with Alvopetro Energy CEO Corey Ruttan

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In a recent interview with Alvopetro Energy (TSXV:ALV,OTCQX:ALVOF) President and CEO Corey Ruttan, he expressed confidence that his company is set to become a key player in Brazil’s open gas market.

Alvopetro’s natural gas sales increased to 187 percent in October of this year, according to the company. With higher overall sales volumes, revenue rose to $12.9 million, an increase of $0.6 million from Q3 2023 and $2.2 million from Q2 2024.

To date, Alvopetro’s production accounts for roughly 13 percent of the natural gas produced in Bahia, and with investments already made in its gas production infrastructure and pipelines, any new natural gas discoveries moving forward can be quickly converted into production and cashflow.

Watch the full interview with Alvopetro Energy President and CEO Corey Ruttan.

This post appeared first on investingnews.com

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US Plans to Triple Nuclear Power Capacity by 2050

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The Biden administration has announced a strategic roadmap to significantly expand the United States’ nuclear energy capacity, setting a target to triple capacity by 2050.

In a new 9-pillar framework, the Biden-Harris administration has laid out its plans to add 200 gigawatts (GW) of new nuclear energy through new reactor builds, reactivations and upgrades to existing facilities.

The initiative seeks to meet a growing demand for reliable, carbon-free power as the nation transitions away from fossil fuels and toward cleaner energy sources.

Under the new roadmap, the country has set a preliminary goal of deploying 35 GW of new nuclear power by 2035, either operating or under construction at that time. Annual capacity deployment will continue to ramp up to hit its goal of a sustained 15 GW per year between 2040 and 2050.

In addition to bolstering nuclear infrastructure, the plan also calls for initiatives to expedite licensing for reactor projects, establish stable tax incentives and explore opportunities to add new reactors to existing nuclear sites.

By targeting both short- and long-term milestones, the administration intends to gradually build the infrastructure and capacity required to reach its overall objective.

More crucially, the administration’s framework is also designed to accommodate flexibility and continuity, enabling future administrations to continue the plan regardless of political changes.

This strategy has gained bipartisan support in Congress, where legislators recently passed new measures to facilitate nuclear development and advance regulatory frameworks, showing a shared commitment to boosting the industry.

President-elect Donald Trump has also voiced support for nuclear energy during his campaign, promising to meet rising industrial energy demands and drive down electricity prices for consumers.

Strategy aligns with global efforts to expand nuclear power

The Biden administration’s roadmap aligns with a broader global push to elevate nuclear energy’s role in climate action.

Last year, at the United Nations Climate Change Conference, the US joined 20 other nations in pledging to triple global nuclear capacity by 2050.

This week, at COP29 in Baku, Azerbaijan, six more countries added their support to this goal, bringing the total number of signatories to 31. Among these new endorsers are nations like El Salvador, Kenya and Türkiye, highlighting nuclear energy’s growing appeal worldwide as a stable, low-emission energy source.

According to data from the International Energy Agency, global nuclear capacity has largely plateaued since the Fukushima disaster in 2011, but interest is renewing as countries confront the urgency of climate commitments and rising electricity demand.

Advanced economies, including the United States, are leading efforts to secure nuclear energy as a key component of their energy transition strategies.

Meanwhile, the US Department of Energy wants to regain America’s competitive edge in nuclear technology, aiming to position the US as a top supplier of nuclear energy solutions.

Nuclear power, which currently provides about 9 percent of global electricity, ranks second to hydropower among clean energy sources, according to the World Nuclear Association. With over 60 reactors under construction worldwide, nuclear’s role in the energy transition is expanding, supported by both governmental and private sector initiatives.

Private sector support for nuclear energy in full swing

As the US government moves to implement the framework, private sector interest in nuclear energy is similarly growing, driven in part by the demand for energy-intensive data processing and artificial intelligence (AI) applications.

Companies like Microsoft (NASDAQ:MSFT) have recently pursued nuclear energy deals to ensure consistent, high-output power for their data centers.

The company entered into an agreement in September to receive power from Pennsylvania’s Three Mile Island nuclear facility — which owner Constellation Energy (NASDAQ:CEG) is now working towards restarting — to meet the company’s clean energy goals.

With this roadmap, the US aims to position itself as a global leader in nuclear energy, reaping both economic and environmental benefits.

Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

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Tech 5: TSMC Gets US$6.6 Billion Biden Admin Grant, Bitcoin Price Hits New All-time High

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Bitcoin reached new heights this week, then paused amid speculation about how high it could go.

Meanwhile, the Biden administration finalized a multibillion-dollar deal to bring advanced semiconductor manufacturing back to the US, and a nuclear energy company backed by Sam Altman announced data center supply deals.

1. Bitcoin price reaches new all-time high

Bitcoin’s price has continued to soar in the wake of Donald Trump’s US election victory, benefiting from bullish sentiment generated by anticipated crypto-friendly policies from the incoming administration. The market capitalization of the crypto industry has surpassed US$3.14 trillion, higher than the GDP of Canada, Brazil and Italy.

After rallying last week, Bitcoin ended the week up 19 percent over seven days, boosted by the prospect of looser regulations and support for innovation under the Trump administration.

The world’s most popular cryptocurrency reached a new all-time high of US$80,000 on Sunday (November 10) and continued its upward trajectory, peaking for the week at US$92,435 on Wednesday (November 13).

Bitcoin performance, November 9 to 15, 2024.

Chart via CoinGecko.

Bitcoin exchange-traded funds (ETFs) experienced a surge in popularity as the price rose, with six consecutive days of inflows totaling US$4.71 billion as of Thursday (November 14). Analysts at Checkmate have identified demand for Bitcoin ETFs as the primary factor driving the surge in Bitcoin demand at the moment.

Additionally, Bitcoin futures open interest climbed to a notable US$55.07 billion.

However, Bitcoin struggled to maintain its hold above US$90,000, falling to the US$87,200 range after US Federal Reserve Chair Jerome Powell’s address in Dallas, Texas, on Thursday. Fresh data on Friday (November 15) morning showed US$400 million of net outflows from Bitcoin ETFs on Thursday, the third-highest loss since the funds were listed.

A slight recovery followed later on Friday after news of a lawsuit against the US Securities and Exchange Commission (SEC) and Gary Gensler by 18 Republican attorneys general, alleging overreach in crypto regulation.

Coinciding with this news, XRP, the native token of Ripple — a company currently involved in legal disputes with the SEC — saw a 17 percent increase in value. The lawsuit challenges the SEC’s application of the Howey Test to classify cryptocurrencies as securities, arguing that the SEC’s interpretation goes beyond the original scope of the Howey Test.

Plaintiffs, including the DeFi Education Fund, point to the SEC’s case against Ripple Labs as a precedent. The judge in that case determined that XRP and similar cryptocurrencies are not inherently securities, even if initially offered as part of an investment contract. This ruling is now being referenced in other legal proceedings.

This ongoing legal challenge could further reshape the regulatory landscape for cryptocurrencies in the US in 2025.

As of 6:00 p.m. EST on Friday, Bitcoin was priced at US$91,246.49.

2. Biden admin finalizes CHIPS Act deal with TSMC

In a push to distribute CHIPS and Science Act funds, the Biden administration has finalized an incentive agreement with Taiwan Semiconductor Manufacturing (TSMC) (NYSE:TSM,TPE:2330).

Under the terms of the deal, the company will receive US$6.6 billion in federal grants to expand operations in the US. In a statement released on Friday (November 15), President Joe Biden said:

“The first of TSMC’s three facilities is on track to fully open early next year, which means that for the first time in decades, an American manufacturing plant will be producing the leading-edge chips used in our most advanced technologies — from our smartphones to autonomous vehicles, to the data centers powering artificial intelligence.”

According to administration officials, TSMC will receive a minimum of US$1 billion out of the total funding awarded this year, since it has already met certain performance targets.

The Biden administration has reportedly been amping up efforts to finalize deals with companies promised CHIPS Act funds, including large firms like Intel (NASDAQ:INTC) and Samsung Electronics (KRX:005930).

Earlier this month, a group of 18 companies sent a letter to the president, urging him to “work with members of your Cabinet and staff across your Administration to remove any roadblocks that may exist, ensuring that the funds highlighted as critical to the success of the objectives of these laws are delivered as promptly as possible.”

The act — which set aside US$39 billion in grants, US$75 billion in loans and loan guarantees and 25 percent tax credits to entice semiconductor companies to manufacture in the US — was criticized as “so bad” by President-elect Donald Trump during his campaign. There is widespread speculation that he may attempt to renegotiate the agreements.

3. Oklo signs letters of intent with data center providers

Oklo (NYSE:OKLO), a company that is developing advanced fission power plants, announced on Wednesday that it has received two letters of intent from major data center providers for up to 750 megawatts of power.

This development marks a major milestone for Oklo, which is backed by OpenAI’s Altman, and underscores the growing demand for sustainable energy solutions within the data center industry.

Oklo says its technology has the potential to revolutionize the way data centers are powered, providing a reliable and sustainable source of energy that can support the ever-increasing demand for computing power.

The company focuses on developing micro reactors, which are smaller than traditional nuclear reactors. This makes them a more viable option as they are better suited for a variety of locations and applications.

While Oklo did not specify which data center operators it received the letters of intent from, the news demonstrates the commercial viability of its technology and the growing importance of nuclear power in the energy mix.

4. Applied Materials, Foxconn release quarterly results

Applied Materials (NASDAQ:AMAT), a leading provider of equipment and software used to manufacture semiconductors, unveiled results for its fourth fiscal quarter of 2024 on Thursday.

While the company’s performance met market watchers’ expectations, its revenue forecast of US$7.15 billion for its first fiscal quarter of 2025 fell short of estimates of US$7.25 billion.

The news resulted in a 9.81 percent decline in Applied Materials’ share price for the week.

The company’s lower outlook suggests a slowdown in spending on semiconductor manufacturing equipment and indicates that chipmakers are potentially scaling back production expansion plans.

Meanwhile, Hon Hai Technology Group (Foxconn) (TPE:2354), a global electronics manufacturing giant best known for assembling iPhones, released its Q3 results ahead of expectations. The report highlights growing revenue from artificial intelligence (AI) servers, with orders for these servers making up over 40 percent of overall server revenue.

Foxconn projects that its AI server revenue will continue to grow, accounting for more than 50 percent of server revenue in 2025. The company relies on a steady supply of semiconductors to build these servers and its other products.

Foxconn’s focus on server demand aligns with the increasing adoption of cloud computing and other data-intensive technologies, driven by the increasing use of cloud-based AI platforms.

5. OpenAI changes tactics as AI advances slow

According to a report published by the Information on Saturday (November 9), OpenAI’s newer intelligence models are not exhibiting the same degree of progress as was observed between GPT-3 and GPT-4.

The news outlet states that testing of OpenAI’s newest model, code named Orion, shows that the rate of improvement appears to be slowing down. During testing, Orion struggled to solve problems it hadn’t been trained on.

The slowdown comes at a time when the availability of data to train AI models is declining. To address this issue, OpenAI has reportedly created a new team focused on improving its models’ capabilities — its strategies include using synthetic data produced by other AI models to train Orion and alter its post-training processes.

A Reuters article suggests that new training techniques will use more “human-like ways for algorithms to think.’ AI researchers told Reuters about a technique called test-time computing, which could enhance a model’s ability to generate and assess multiple responses before selecting the optimal solution. This method could potentially provide models with increased processing power to tackle complex tasks such as solving math problems and coding.

Sources told Bloomberg that Anthropic and Alphabet (NASDAQ:GOOGL) are seeing similar slowdowns with their newer models, despite investing billions in developing sophisticated AI models and generative AI (AGI).

“The AGI bubble is bursting a little bit,” said Margaret Mitchell, chief ethics scientist at Hugging Face. “It’s become clear that different training approaches may be needed to make AI models work really well on a variety of tasks.”

Researchers developing new training techniques could shift demand away from chips used to train AI and toward “inference clouds,” described to Reuters by Sequoia Capital partner Sonya Huang as “distributed, cloud-based servers for inference.’ This is the process of an AI model applying its knowledge to new data before generating results.

Securities Disclosure: I, Meagen Seatter, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

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