📈 Aartha Weekly Market Newsletter - Jan 4th, 2026

Date: Recap of Week Dec 29, 2025 – Jan 2, 2026

Welcome to the first recap of 2026. We’ve officially closed the book on a historic 2025, a year where the S&P 500 notched 39 new all-time highs and delivered a total return of approximately 18%. The final week of the year was a tale of two halves: a quiet, tax-loss-driven drift into New Year’s Eve, followed by a massive "fresh capital" surge on the first trading day of 2026.

🏆 Top Performers & Signal Updates

*Calculated based on the Jan 2nd closing prices.

🌐 U.S. Markets: The 2026 Kickoff

The final three days of 2025 saw the "Santa Drift" lose some steam as investors finalized tax-loss harvesting. However, Friday, Jan 2nd, saw the expected "First Day" effect. Fresh institutional allocations poured into the market, specifically targeting the winners of 2025.

• S&P 500: Finished 2025 slightly off its highs but reclaimed ground on Friday, closing at 6,858.
• The "Jan 2nd" Inflow: We saw a significant rotation back into high-beta tech. While the broader index wobbled in the afternoon, the AI infrastructure names were aggressively bought on the open.

📊 NASDAQ: The "Memory" Explosion (+3.5% on Friday)

Our "Storage is the New Oil" thesis was the undisputed star of the week. On Friday, the Philadelphia Semiconductor Index (SOX) jumped 3.5%, led by a parabolic move in memory providers.

• Micron (MU) Breakout: MU shocked the market on Jan 2nd, gapping up and surging +10.5% to close near $315. This move was fueled by reports of an "unprecedented HBM memory shortage" that is expected to last well into 2027.
• WDC & SNDK: Western Digital and SanDisk Corp followed suit, gaining +8% and +11.7% respectively.
• Strategy: TRAIL STOPS. We are now moving our trailing stops up significantly to lock in these "New Year" gains. The trend is vertical, but we must protect capital against any "mean reversion" pullbacks.

🏛️ Macro Driver: The Yield Creep

While equities were cheering, the bond market sent a warning signal. The 10-year Treasury yield, which we tracked at 3.85% last week, has crept up to 4.18%.

• Why it matters: Higher yields generally act as a gravity force on tech valuations. If yields continue toward the 4.5% mark, we may see the "AI Infrastructure" names decouple from the rest of the NASDAQ.
• Labor Market: Initial Jobless Claims came in at 199k (below the 222k estimate), showing that the labor market remains "stubbornly strong"—a factor the Fed is watching closely for its next rate decision.

💰 Gold & Crypto: Holding the Line

Gold: The Dip-Buying Continues

Gold recovered from its late-December correction. After hitting a record $4,549 on Dec 26, it settled back but caught a bid on Friday to close around $4,371/oz.

• Aartha Signal: GDXU (Profit taken on Daily). The rebound on Jan 2nd suggests that the safe-haven bid is still alive and well for 2026.

Crypto: The $90k Magnet

Bitcoin spent the week in a tug-of-war between $88,000 and $92,000. It ended the week near $89,500.

• The Dynamic: Institutional Spot ETF flows were quiet due to the holiday, but whale accumulation was noted near the $88k support level. We expect a high-volatility "direction setter" move in the first full week of January.

📅 The Week Ahead: The First Full Week (Jan 5 – Jan 9)

Liquidity returns to 100% this week. Expect the "real" 2026 trend to emerge.

• Monday, Jan 5: ISM Services PMI data.
• Wednesday, Jan 7: FOMC Minutes release (Expect clues on the "Dovish Trajectory").
• Friday, Jan 9: Non-Farm Payrolls (NFP). This is the main event. A "Goldilocks" number (not too hot, not too cold) is needed to keep the rally alive.

🔍 What This Means for Aartha Traders

1. Don't Fight the Gap: The Jan 2nd gap in MU and WDC is a sign of high institutional demand. We stay long until a clear reversal candle appears.
2. Watch the 4.2% Yield Level: If the 10-year yield breaks 4.20%, look for a potential "valuation reset" in software names like Microsoft and Apple.
3. NFP Volatility: Friday will be the first "High Impact" day of the year. Ensure your stop-losses are set before the 8:30 AM ET release.

📥 Final Word

We started 2026 exactly how we wanted: with our core "Storage" positions leading the entire market. The "Holiday Hush" is over, and the data-driven reality of the new year begins tomorrow. Stick to the signals, manage your risk, and let’s make 2026 even better than 2025.

Would you like me to prepare a "Sector Rotation Report" for January to see which lagging sectors might catch up to the AI hardware trade?

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