2026 Year in Review

Hard to believe it’s 2026 already, we just saw one of the most lucrative, albeit challenging market years since covid. For most of the prior year, speculative fervor gripped different sectors in fickle government orchestrated pumps, and picking favorites was essential to sustain outperformance. I don’t expect 2026 to be too much different, and likely will be more challenging with valuations at all-time highs. Many sectors are stretched far
beyond “rational” valuations… the lazy river eventually leads to rapids, and
that is the simplest analogy for the year to come. 

While I’ve mentioned this many times before, it’s an important reminder that we are in a QE orchestrated world, driven by continuous money printing and fiat devaluation. The only thing that matters is finding relative value to outrun decaying fiat, and front run liquidity.

Taking a look at my famous macro chart gives some color to our situation. M2 continues to expand, global liquidity is growing everywhere, and this is likely to accelerate in 2026 with potential further rate cuts, and the installation of a more dovish FED chair. In a
nutshell, expect the US administration to “Run it Hot”.

There are several major catalysts on the deck for 2026 which will all be liquidity friendly:

• The Federal Reserve is cutting rates

• The Fed has quietly started QE, with $40B/month in balance sheet expansion

• $1000 “Trump” accounts for new babies

• Jerome Powell will be replaced by Warsh (pending senate), likely a Trump controlled FED chair

• Inflation (CPI YoY) has dropped below 2% for the first time in 5 years

• Unemployment has been ticking up, now at 4.4%

• US midterm election incoming (next 3-9 months)

• Trump calling for US credit card interest rate cap at 10%

I’ll have some macro charts in this edition, and a separate section on shorter term. Get a coffee and strap in!

Looking at the Dow bigger picture, we’ve yet to test the major high set in late 2024. While we may not get back down there, historical context is important to keep in mind if* we do. These high timeframe re-tests are among the highest R/R entries that exist, can get create generational wealth simply by buying the dip in size.

Russell 2000 was emphasized in my last publication, and has been the highest performing index YTD. QQQ is shown in blue here to illustrate the massive lag, and the huge base of support for IWM at current levels. It has basically gone nowhere since 2022, and the case for outperformance remains strong.

Nasdaq is still the high beta, and targets
688, but given valuations, safer R/R elsewhere in the coming months.

While technicals are hugely helpful in finding good R/R and steering clear of bad, our market has felt a lot like covid in the last year, where picking winners and riding narratives is essential to outperformance. I don’t expect that to change in 2026. Looking
across the private spectrum from many of the family offices and funds I speak
with, the intersection between humanoid robotics and AI is likely to catalyze
further upside in Q1 and Q2. Leading humanoid robotics companies like Figure AI
and Apptronix are gearing up to go public, and talk of either a SpaceX IPO, or super
merger with Tesla is also in the cards. However you may feel about Elon, he is
one of “da boys”, and they tend to take care of each others’ pocketbooks.

In terms of major catalysts, I’d expect Trump to invade Iran in the coming weeks, if for no other reason than to take attention off the Epstein files. That said, war usually ends up being bullish once the actual operation starts. So buy the dip… Wild that most of our elected officials are corrupt pedophiles, even more wild that nobody seems to care enough to pursue indictments. Time to buy your conspiracy theorist friend a beer.

The runway on AI and compute is still significant, and I continue to hold opportunistic positions like POET Tech (for their patented optical connectivity for GPU’s), deep value plays like $OPRA that have significant cash and untapped user bases, and will be scaling back into $WULF (which we hit 500%+ on last year) on dips. While it’s easier said
than done, moving tactically and selling into FOMO on hyped up narratives,
while buying fear and “quiet” sectors will continue to be my focus in 2026.

While I don’t normally comment on real estate, I am seeing significant discounts in the commercial space and have been actively bidding… Cap rates have come up close to 50% in my local market, and for long term money I quite like what I am seeing… 5 year debt from covid is now rolling over, and there’s a huge demographic shelf that needs to sell their assets… Look for deals with quality, AI proof tenancies and see where a lowball
takes you.

Keeping valuations in mind, I like looking at indices relative to M2 money… While we aren’t there yet, we are getting close to 1999 valuations on the S&P. QQQ has surpassed and now flipped that area as “support”. In one sense, you could argue we haven’t really “grown” in 25 years, we’ve simply seen the denominator (the dollar) erode in “value”

Ultimately, the US dollar runs the show, and the valuation relative to peers will have a huge impact on risk assets, bonds, and crypto. Currently, most of the articles you read are about the “death of the dollar” and seem to be ripe with bearish sentiment. While this isn’t a slam dunk entry, I see significant support here on the DXY, so short term
caution is warranted, especially for metals bulls and Crypto

Bonds are in a curious place… While I expect rates to drop to 3%~ in the US, the demand (or lack thereof) for Central Bank debt was a major crack in the established order in
2025, and I believe will be a central theme for 2026. From a technical, and
fundamental perspective, bonds are in no-man’s land and I have no interest in
the trade.

Crypto

Total Cap in crypto has been a dog for an entire year. While I do eventually expect $10T+, without a salacious entry point or some “blood on the street”, l don’t see the appeal to get long in size quite yet. The R/R here is nice, but I’d prefer to wait for some bullish momentum and buy a retest.

Bitcoin in isolation doesn’t look bullish, the trend is down. That being said, on a relative, high time frame basis it is cheap. It’s re-testing the 2021 cycle high, look back at the history of this and watch what happened… We’re also starting to see AI’s start using bitcoin to transact with each other… if you like the asset, this isn’t a bad spot to start
accumulating

It’s important to be mindful of how quickly sentiment can turn… from a RELATIVE basis, BTC is actually quite cheap relative to the Nasdaq, and other assets like Gold. These ratio charts can often be a hidden tell. BTC has lagged the Nasdaq dramatically, and could be close to putting in a bottom.

In terms of Gold, a similar picture is forming… and trading some “pet rock” for “digital gold” may be wise…

Short Term

In my last report I gave the Halliburton trade (when the stock was $29), speculating on underpriced oil and potential Venezuelan invasion. Both came to fruition and this option trade ran over 500%.

New Trades:

METC – this is a dangerous but higher R/R name…

HP – Massive lag to the QQQ, strong support.
Questions about long term business viability of PCs and soaring costs of goods –
purely technical + low iv% play. Look for a 10%+ bounce and see what happens
after.

TLDR;

1. Upward momentum should continue after some chop. IWM to outperform

2. China+ Oil sector is still* value priced here

3. Precious metals in a SELL zone (see the special report, I gave you the EXACT top and suggested silver puts…). Let the market shake out here before considering a position

4. BTC needs to “prove itself”, not interested unless we get some momentum

5. Let the market come to you… patience for now, not trading anything in size here

Trades from the
Dec 22^nd letter:

- AAPL March 19^th $300C at $3.3 à Big loser so far, I averaged down as indicated but still down -60%~

- Trans Alta Stock around $12.10* à 10-15% up move, take it and run

- HAL March 19^th $32C for .62~ à 400-500% move! Exited most of my position

- BABA is up $30 from posting (15%~), take it and run. I still like it longer term

New Positions:

- HPQ March 20^th 22C at .35

- METC stock around $19.5

- SHOP at $133~