Let’s look at what’s actually happening with the Nasdaq 100 (QQQ) as we wrap up 2026.
If you step back and look at the big picture, three clear takeaways stand out:
1) The market is still climbing a massive wall of worry. If someone had told you earlier this year where oil prices and interest rates would end up, you probably wouldn’t have believed the market could hold up this well.
2) AI is carrying the entire narrative. Right now, the economy and the stock market are practically glued to AI. The moment investors worry that data center or infrastructure spending might slow down, tech stocks take an immediate hit.
3) The broad indices don't tell the full story. Serious rotation is happening under the hood.
From Market Savior to "Tech Destruction"
Remember last year when everyone complained that big tech was single-handedly dragging the rest of the market up? The script has flipped. QQQ just logged its worst three-day drop since "Liberation Day." In fact, Morgan Stanley noted that U.S. tech momentum recently hit levels worse than during the dot-com bust.
So, what’s holding equities back right now? It boils down to four main worries:
• Inflation and stubborn interest rates
• Political headwinds surrounding AI
• Debt and funding fears in AI infrastructure
• Pure technical gravity and profit-taking
Here is why there's good reason to believe the market will push past these hurdles in the coming months.
Inflation & Interest Rates
Recent energy spikes reignited inflation fears and pushed yields higher, but geopolitical energy shocks are usually short-lived. We’ve already seen oil cool off following reports of potential progress on a U.S.–Iran agreement.
On the rate front, market projections lean toward 3 to 4 quarter-point hikes extending into mid-to-late 2027. But as the team at BlueKurtic Market Insights pointed out, stocks can actually perform quite well during rate-hiking cycles—provided the pace is steady.
This looks more like a limited, non-cyclical adjustment (likely capping out at 2 to 3 hikes) rather than an aggressive tightening regime. The last time we saw a similar non-cyclical adjustment was in 1997, and the S&P 500 went on to gain 40% over the following year.
Continue . . .
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Only $1 for AI Stock Access
Artificial Intelligence (AI) is predicted to skyrocket from $390 billion to $3.5 TRILLION in 2033, igniting many tech stocks along the way. Today, you can be among the first to learn about Zacks' newest stock that will be revealed Monday morning.
Special opportunity ends at midnight Sunday, November 8.
Start Access Now for $1 >>
------------------------------------------------------------------------------------------------------
Politics & the Midterm Effect: Why Gridlock is Good
AI buildouts have run into public pushback—a recent Reuters poll showed only about a third of Americans approve of the current rapid pace of data-center construction. Markets have also been trying to price in the political "Blue Wave," which added fuel to the tech sell-off over fears of tighter regulation.
However, markets are forward-looking mechanisms. This setup is shaping up to be a classic "sell the rumor, buy the news" event.
Historically, a divided government is actually great for stocks—divided setups typically deliver higher average returns than when one party controls both Congress and the White House. On top of that, midterm seasonality is heavily on our side: the S&P 500 has finished higher six months after every single midterm election since 1950. That’s 19 straight elections with an average gain of nearly 15%, regardless of who won.
AI Debt & Funding Fears
Fears spiked in October when CoreWeave (CRWV) saw its bond yields jump to distressed levels, causing its stock to tumble. The market briefly priced CRWV as if bankruptcy were imminent—at one point in September, Polymarket showed a 50% chance of a 2027 bankruptcy.
Today? That probability has plummeted to just 12%. The extreme solvency fears were largely overblown.
Technical Gravity & Necessary Reset
Earlier this year, several AI stocks simply went too far, too fast.
Take SanDisk (SNDK): it blew way past its Fibonacci extensions, surged 4,000% in a single year, and stretched 264% above its 200-day moving average. Anything more than 200% above that trendline is extreme. Think of the 200-day moving average as a rubber band—stretch it too far, and it inevitably snaps back.
Even the strongest market leaders need to reset. What we’re seeing right now across names like Marvell (MRVL), Arm Holdings (ARM), and Micron (MU) is a standard pullback to test those major moving averages. Historically, that first test of a rising 200-day line offers one of the best risk-reward entry points you can ask for.
Bottom Line
While scary headlines around AI leverage, rates, and politics caused a sharp pull-back, the underlying technical frame of this market remains healthy. Extended tech leaders are flushing out excess leverage and returning to key support levels. Combined with favorable post-midterm seasonality and the benefits of political gridlock, this reset looks less like the end of the run and more like a setup for the next leg higher.
Top Market Moves to Watch Right Now
One of the market's strongest trends is the tech sector's resurgence. It's no surprise that the rapid expansion of Artificial Intelligence is driving much of the sector's momentum.
This trend could be highly lucrative for both short-term traders and long-term investors, even as the market reaches record highs.
Today, I invite you to look inside the portfolio I'm managing, Zacks Technology Innovators.
While not all our picks are winners, recent recommendations have delivered gains of +120.7%, +140.5%, and +153.0%.¹
And we're expecting more outsized gains in the months ahead.
In fact, I'm about to add a stock to the portfolio that has exceptional upside.
When it comes to AI, most investors focus on big names that make the headlines. But one of our top analysts found one that works behind the scenes, designing key components that help AI systems run at full speed. Some of the world's largest tech firms already rely on this business, and demand continues to grow, keeping pace with AI spending.
You can be among the first to see this fresh pick and get aboard when it's posted Monday morning. Plus, you'll also have the chance to immediately access all the live picks inside the Technology Innovators portfolio.
Bonus Report: When you check out our Technology Innovators, you may also download our Special Report, Beyond AI: The Quantum Leap in Computing Power.
As AI reshapes industries, quantum computing promises to redefine the very limits of computational possibility. This Special Report explores the cutting-edge developments in this emerging field and reveals 7 key stocks positioned to benefit from the radical technology.
Don't wait. The total cost to see all Zacks tech stocks (and other recommendations) for 30 days is an astonishing $1. There's not a cent of further obligation. The deadline for this unique opportunity is midnight Sunday, November 8.
Click for $1 Stock Access and Your Bonus Special Report >>
All the Best,
Andrew Rocco
Zacks Stock Strategist
Andrew is Zacks' technology stock strategist. He's passionate about making money on stocks and providing education with valuable insights from both a fundamental and technical perspective. He invites you to explore his Technology Innovators portfolio.
¹ The results listed above are not (or may not be) representative of the performance of all selections made by Zacks Investment Research's newsletter editors and may represent the partial close of a position. Access grants you a comprehensive list of all open and closed trades.
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Q4 QQQ Roadmap: Navigating AI Turbulence & Market Headwinds
Let’s look at what’s actually happening with the Nasdaq 100 (QQQ) as we wrap up 2026.
If you step back and look at the big picture, three clear takeaways stand out:
1) The market is still climbing a massive wall of worry. If someone had told you earlier this year where oil prices and interest rates would end up, you probably wouldn’t have believed the market could hold up this well.
2) AI is carrying the entire narrative. Right now, the economy and the stock market are practically glued to AI. The moment investors worry that data center or infrastructure spending might slow down, tech stocks take an immediate hit.
3) The broad indices don't tell the full story. Serious rotation is happening under the hood.
From Market Savior to "Tech Destruction"
Remember last year when everyone complained that big tech was single-handedly dragging the rest of the market up? The script has flipped. QQQ just logged its worst three-day drop since "Liberation Day." In fact, Morgan Stanley noted that U.S. tech momentum recently hit levels worse than during the dot-com bust.
So, what’s holding equities back right now? It boils down to four main worries:
• Inflation and stubborn interest rates
• Political headwinds surrounding AI
• Debt and funding fears in AI infrastructure
• Pure technical gravity and profit-taking
Here is why there's good reason to believe the market will push past these hurdles in the coming months.
Inflation & Interest Rates
Recent energy spikes reignited inflation fears and pushed yields higher, but geopolitical energy shocks are usually short-lived. We’ve already seen oil cool off following reports of potential progress on a U.S.–Iran agreement.
On the rate front, market projections lean toward 3 to 4 quarter-point hikes extending into mid-to-late 2027. But as the team at BlueKurtic Market Insights pointed out, stocks can actually perform quite well during rate-hiking cycles—provided the pace is steady.
This looks more like a limited, non-cyclical adjustment (likely capping out at 2 to 3 hikes) rather than an aggressive tightening regime. The last time we saw a similar non-cyclical adjustment was in 1997, and the S&P 500 went on to gain 40% over the following year.
Continue . . .
------------------------------------------------------------------------------------------------------
Only $1 for AI Stock Access
Artificial Intelligence (AI) is predicted to skyrocket from $390 billion to $3.5 TRILLION in 2033, igniting many tech stocks along the way. Today, you can be among the first to learn about Zacks' newest stock that will be revealed Monday morning.
Special opportunity ends at midnight Sunday, November 8.
Start Access Now for $1 >>
------------------------------------------------------------------------------------------------------
Politics & the Midterm Effect: Why Gridlock is Good
AI buildouts have run into public pushback—a recent Reuters poll showed only about a third of Americans approve of the current rapid pace of data-center construction. Markets have also been trying to price in the political "Blue Wave," which added fuel to the tech sell-off over fears of tighter regulation.
However, markets are forward-looking mechanisms. This setup is shaping up to be a classic "sell the rumor, buy the news" event.
Historically, a divided government is actually great for stocks—divided setups typically deliver higher average returns than when one party controls both Congress and the White House. On top of that, midterm seasonality is heavily on our side: the S&P 500 has finished higher six months after every single midterm election since 1950. That’s 19 straight elections with an average gain of nearly 15%, regardless of who won.
AI Debt & Funding Fears
Fears spiked in October when CoreWeave (CRWV) saw its bond yields jump to distressed levels, causing its stock to tumble. The market briefly priced CRWV as if bankruptcy were imminent—at one point in September, Polymarket showed a 50% chance of a 2027 bankruptcy.
Today? That probability has plummeted to just 12%. The extreme solvency fears were largely overblown.
Technical Gravity & Necessary Reset
Earlier this year, several AI stocks simply went too far, too fast.
Take SanDisk (SNDK): it blew way past its Fibonacci extensions, surged 4,000% in a single year, and stretched 264% above its 200-day moving average. Anything more than 200% above that trendline is extreme. Think of the 200-day moving average as a rubber band—stretch it too far, and it inevitably snaps back.
Even the strongest market leaders need to reset. What we’re seeing right now across names like Marvell (MRVL), Arm Holdings (ARM), and Micron (MU) is a standard pullback to test those major moving averages. Historically, that first test of a rising 200-day line offers one of the best risk-reward entry points you can ask for.
Bottom Line
While scary headlines around AI leverage, rates, and politics caused a sharp pull-back, the underlying technical frame of this market remains healthy. Extended tech leaders are flushing out excess leverage and returning to key support levels. Combined with favorable post-midterm seasonality and the benefits of political gridlock, this reset looks less like the end of the run and more like a setup for the next leg higher.
Top Market Moves to Watch Right Now
One of the market's strongest trends is the tech sector's resurgence. It's no surprise that the rapid expansion of Artificial Intelligence is driving much of the sector's momentum.
This trend could be highly lucrative for both short-term traders and long-term investors, even as the market reaches record highs.
Today, I invite you to look inside the portfolio I'm managing, Zacks Technology Innovators.
While not all our picks are winners, recent recommendations have delivered gains of +120.7%, +140.5%, and +153.0%.¹
And we're expecting more outsized gains in the months ahead.
In fact, I'm about to add a stock to the portfolio that has exceptional upside.
When it comes to AI, most investors focus on big names that make the headlines. But one of our top analysts found one that works behind the scenes, designing key components that help AI systems run at full speed. Some of the world's largest tech firms already rely on this business, and demand continues to grow, keeping pace with AI spending.
You can be among the first to see this fresh pick and get aboard when it's posted Monday morning. Plus, you'll also have the chance to immediately access all the live picks inside the Technology Innovators portfolio.
Bonus Report: When you check out our Technology Innovators, you may also download our Special Report, Beyond AI: The Quantum Leap in Computing Power.
As AI reshapes industries, quantum computing promises to redefine the very limits of computational possibility. This Special Report explores the cutting-edge developments in this emerging field and reveals 7 key stocks positioned to benefit from the radical technology.
Don't wait. The total cost to see all Zacks tech stocks (and other recommendations) for 30 days is an astonishing $1. There's not a cent of further obligation. The deadline for this unique opportunity is midnight Sunday, November 8.
Click for $1 Stock Access and Your Bonus Special Report >>
All the Best,
Andrew Rocco
Zacks Stock Strategist
Andrew is Zacks' technology stock strategist. He's passionate about making money on stocks and providing education with valuable insights from both a fundamental and technical perspective. He invites you to explore his Technology Innovators portfolio.
¹ The results listed above are not (or may not be) representative of the performance of all selections made by Zacks Investment Research's newsletter editors and may represent the partial close of a position. Access grants you a comprehensive list of all open and closed trades.