Nasdaq (^NDX) Today, December 29: JP ‘kenmo’ Flags AI Bubble Risk
Japan’s star retail investor kenmo is back in focus today as the Nasdaq ^NDX hovers near recent highs and AI leaders cool. His warning on AI bubble risk and emphasis on earnings momentum matter for Japanese retail investors who chased semiconductors in 2024. With sentiment stretched and data‑center capex heavy, we review index signals, potential rotation, and portfolio steps for year‑end positioning. We keep this simple, data‑driven, and useful for day‑to‑day decisions in Japan.
Nasdaq Snapshot: Levels and Signals
The index trades around 25,656, inside a tight intraday band of 25,556.85 to 25,665.28. The 52‑week range is 16,542.2 to 26,182.1, so price is near the top of its range. The 50‑day average is 25,274.17 and the 200‑day is 22,802.61, both rising. This supports a constructive medium trend, even as the short‑term picture looks stretched.
RSI at 56.78 is neutral, but Stochastic %K at 82.96 leans hot. MACD is positive with a firm histogram, while ADX at 11.93 signals a weak trend. Price sits close to the Bollinger upper band near 26,005.78. ATR at 333.39 implies active daily swings. Together, the setup favors cautious buy‑the‑dip rather than chase.
For Japan‑based investors, index exposure can work if entries respect nearby references. The 50‑day average at 25,274 and lower Bollinger near 24,868 are useful risk markers. If price closes above the upper band and holds, momentum could extend. If it slips under the 50‑day, expect a broader consolidation into January.
kenmo’s Playbook: Earnings Momentum With Risk Control
kenmo’s approach centers on earnings momentum, buying leaders after clean beats and stronger guidance, then exiting when revisions slow. He calls it a rules‑first style that avoids stories without numbers. For background on his method and case studies, see this profile from Bunshun source.
He sees AI winners priced for perfection while data‑center capex runs intense, which can squeeze returns if demand normalizes. Sentiment is crowded, so small misses can hit hard. His recent comments featured by TV Tokyo’s WBS underline the caution into 2025 source.
We favor simple rules in line with kenmo: wait for post‑earnings strength on volume, track 1‑3 month revisions, and cut when guidance weakens. Use trailing stops around recent swing lows. Avoid averaging down in falling momentum. Screen for cash‑rich firms with steady margins and clear paths to fund AI spend without diluting returns.
Portfolio Moves for Japanese Retail Investors
If AI bubble risk rises, emphasize companies with stable cash flow, recurring revenue, and disciplined capex. That reduces shock from guidance resets. Within tech, pick firms with pricing power and backlog visibility. Outside tech, mix in healthcare and staples to smooth volatility while keeping optionality for the next growth leg.
Decide if you want USD exposure or yen‑hedged returns. Hedged products reduce FX noise but come with costs that can change. Unhedged exposure can benefit when the yen weakens, but it can also amplify losses on tech drawdowns. Match exposure to your time horizon and risk budget.
Consider a core index sleeve plus a cash buffer for dips. That supports buy‑the‑dip plans without forced selling. If breadth narrows and leaders fade, trim back to targets. If breadth improves with rising revisions, redeploy. Keep the playbook simple so decisions are quick and repeatable.
January Watchpoints and Triggers
Watch whether the index tests the 50‑day average near 25,274 with RSI easing toward 40. A tag of the middle Bollinger band around 25,437.17 often marks a healthy reset. Rising ATR without higher highs can signal chop, a common backdrop for rotations out of crowded AI trades.
Look for a close and hold above the Bollinger upper band near 26,005 alongside improving earnings revisions breadth. A fresh high with expanding volume is better than a thin breakout. If semiconductors lead on strong guidance, momentum can resume. Let price and revisions confirm before sizing up.
If AI leaders show durable margin gains, capex efficiency, and strong order pipelines, the correction risk fades. kenmo would likely prioritize numbers over narratives. Clear revenue acceleration with clean cash conversion is a green light. If those arrive together, the AI trade can work again at higher conviction.
Final Thoughts
Today’s setup is straightforward. The Nasdaq sits near the top of its range, momentum is positive but not decisive, and volatility is active. kenmo warns that AI bubble risk is rising into 2025 as sentiment crowds and data‑center spend stays heavy. That does not require panic. It calls for rules. We would keep a core index sleeve, add on clean resets toward key moving averages, and trim when revisions stall. Earnings momentum remains the guide. Let price and guidance lead entries and exits. Stay flexible with hedging, keep cash for dips, and require better breadth before chasing breakouts. If numbers improve, we lean back in. If not, patience is also a position.
FAQs
kenmo is a well‑known Japanese individual investor who built wealth using a rules‑based style focused on earnings momentum. He shares practical methods and risk control that many retail investors can copy. His views often influence local sentiment, especially around tech and index positioning.
Earnings momentum means buying companies after strong reports and guidance, while revisions and price remain supportive. The idea is to ride confirmed strength, not predictions. Traders then reduce or exit when revisions slow, margins compress, or price breaks key moving averages on rising volume.
Use a core index position with clear add‑on and trim rules. Consider waiting for pullbacks toward moving averages. Size positions modestly, keep a cash buffer, and decide on yen hedging based on horizon. If revisions weaken in semiconductors, rotate some exposure to defensive or quality growth names.
Key references are the 50‑day average near 25,274, the middle Bollinger band around 25,437, and the upper band near 26,006. RSI near 40 after a pullback often marks better entries. A close below the 50‑day suggests a deeper consolidation, while sustained closes above the upper band favor momentum.
Hedging reduces currency swings in yen terms but has costs. Unhedged positions can help when the yen weakens, yet they add risk if the yen strengthens during an equity drawdown. Match hedging to your time horizon, volatility tolerance, and whether your liabilities are in JPY.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.
