Stocks closed higher on Friday, but down for the week.

After Wednesday's FOMC Minutes (from October's Fed meeting, which saw them cut rates for the second time this year) showed disagreement over what to do at December's meeting, some doubt was cast on whether we'll get the expected third rate cut when they meet again in December.

But on Friday, Fed policymaker John Williams said he sees "room for further adjustment in the near term."

That boosted hopes for another cut when they meet on December 9-10. In fact, the CME's FedWatch tool puts the likelihood of a 25 basis point cut at 71.0%.

And that buoyed stocks.

But continued worries over whether we're in an AI bubble or not has been hanging over the market.

But I do not believe we are in an AI bubble.

Nor does the CEO of AI-bellwether NVIDIA think so either.

Last week, NVIDIA positively surprised on both the top and bottom lines, posting a 60.5% quarterly EPS growth rate, and a 62.5% sales growth. Astonishing numbers for such a large company, not to mention the consistency of these huge gains (10 quarters in a row of double-digit and triple-digit gains for both sales and earnings). And their upped revenue guidance for Q4 was just as astonishing. In fact, CEO Jensen Huang was quoted as saying their Q4 outlook is "crazy good."

And he dismissed talk of AI bubble fears. He said, "we're in the beginning of a very long-term buildout of the fundamental infrastructure of humanity, which is computing." "We reinvented computing for the first time in 60-70 years, and so all of the computers that have been installed around the world, is being modernized to accelerated computing and NVIDIA's GPUs and to Artificial Intelligence."

So no, I do not believe AI is in a bubble.

What we have experienced over the last few weeks is a pullback.

An ordinary pullback that happens in every bull market.

Pullbacks are defined as a decline between -5% and -9.99%, and they happen on average of 3-4 times a year.

And after 6 months of near painless gains, we were due do for a pullback.

But if you know these are commonplace moves, you can instead look at them as opportunities to buy rather than places to sell.

From their recent highs, the Dow, at its worst (Thursday's close), was off by -5.19%, the S&P was off by -5.11%, and the Nasdaq was off by -7.85%. Those numbers improved a bit on Friday with the indexes now off by 'just' -4.16%, -4.18%, and -7.18%, respectively.

A textbook definition of a pullback.

But pullbacks offer excellent opportunities to get in at better prices before the next leg up. And that's exactly what I'm expecting.

YTD, despite the pullback, the Dow is up 8.70%, the S&P is up 12.3%, and the Nasdaq is up 15.2%.

And with Q4 being the best quarter for stocks, not to mention it being a post-election year when November and December have a 72.2% and 77.8% likelihood of closing higher, I'm expecting a lot more upside to go. Especially with the backdrop of a transformational AI tech boom underway.

We've got a shortened trading week this week. Just 3½ trading days. Monday-Wednesday we have normal trading hours. But on Thursday, the markets are closed for Thanksgiving. And on Friday, we have a half-day with the markets closing early at 1:00 PM ET.

Shorter week, but should be a busy one.

See you tomorrow,