Managing Editor’s Note: Today, we’re bringing you an essay from Luke Lango…
He says a flood of cash – roughly $7 trillion – is poised to rush back into U.S. stocks. One ultra-rare signal says the surge starts now, and a second, even bigger catalyst on May 7 could change the entire market and create a summer “panic” like we’ve not seen since 1997.
Look no further than today’s market dynamics for proof of the coming storm…
Trade-war headlines are whipping the market back and forth. Fear of tech slowdowns are freezing would-be buyers. Record cash piles are sitting idle while volatility rattles Wall Street. Most investors feel trapped, wondering whether the next big move is another crash.
That may sound scary… but Luke says what we’re seeing are the fingerprints of a bottom, not a collapse.
In today’s issue, Luke will unpack some of those developments…. including the fact that his favorite technical indicator triggered last Thursday.
He’s also identified seven specific ways to profit from this Summer Panic. And he’ll tell you more about it on May 1, during his Summer Panic Summit. So make sure you reserve your spot automatically right here.
The Biggest Stock Market Shift Since 1997: Here’s What’s Coming
BY LUKE LANGO, EDITOR, EARLY STAGE INVESTOR
Here’s why the market took off last week… First, the fundamentals are turning green.
Alphabet Inc. (GOOGL) reported strong quarterly earnings Thursday night. Revenues grew steadily in both advertising and cloud — two segments that investors feared would show signs of strain amid the trade war drama. But no big slowdown showed up.
Alphabet’s results poured cold water on the tech slowdown fears that have weighed on markets for weeks.
Meanwhile, more positive signs are emerging on the trade front.
Reports broke on Friday that China is considering exemptions for certain U.S. imports from its 125% retaliatory tariff. That comes just days after the U.S. issued its own exemptions from its 145% tariff on Chinese goods.
One side softens. Then the other. That’s how deals get made.
Stocks rallied. The dollar rallied. Bonds rallied. The “Sell America” panic trade is turning into a “Buy America” rally.
The stage is now set for trade deals over the next few months. Plus we’re seeing strong earnings and stabilizing inflation.
All of this makes the May 7 catalyst I’m expecting even more likely.
For technical traders, the story is just as bullish…
Ultra-Rare Indicator Triggered
On Thursday, the Zweig Breadth Thrust bullish signal officially triggered.
A ZBT signal is triggered during very strong price momentum… when the stock market moves from an oversold to an overbought situation in 10 or fewer trading days.
The ZBT is an ultra-rare, ultra-bullish indicator that’s only flashed 18 times since World War II. In every single instance, stocks were higher a year later — with average gains of 25%.
That’s not noise. That’s a signal.
Meanwhile, the S&P 500 just last week notched three straight days of gains over 1.5%. That’s another rare signal. Since 1950, every time that’s happened, stocks have been higher a year later — every single time — with average gains of 10%.
You don’t see this kind of price action in the middle of a collapse. You see it when a collapse is ending.
We think stocks have bottomed — and we’re very bullish heading into the summer.
These sorts of catalysts are often the most important thing in investing.
Regional banks and biotechs can trade sideways for years… and then surge 100% on a takeover offer. Falling stocks tend to continue downward until a good news catalyst stems the tide.
And now, I’ve identified a new catalyst that I believe will change the entire market.
Forget the Mag 7… Meet the MAGA 7
What happens when you mix the most transformational technological megatrend of our lives (AI) with arguably the most ambitious U.S. president we’ve ever seen (Trump)?
You could ignite a $7 trillion Summer Panic in the markets… the sort of surge that we haven’t seen since the 1997 internet boom.
That’s because investors are sitting on a record $7 trillion in cash, waiting for the opportunity to jump in. Private equity alone is sitting on at least $2.62 trillion, according to S&P Global Market Intelligence.
That means we could see an enormous return of this cash to the stock market this summer.
Because here’s the truth: What we’ve seen in 2025 isn’t the stock market’s first “crash” in recent years.
The 2010 Flash Crash. The 2011 U.S. debt ceiling downgrade. The 2015 yuan devaluation. The 2018 Fed hike panic. The 2020 Covid crash. The 2022 inflation meltdown.
All of them were buying opportunities for those who knew where to look.
It was during many of the stock market crashes in the last decade that I nailed the rise of the Magnificent 7 stocks.
Amid the commodity crisis of the mid-2010s, I picked out Meta Platforms Inc. (META), Apple Inc. (AAPL), Amazon Inc. (AMZN), and Microsoft Corp. (MSFT) as long-term winners. All four have recorded max gains of somewhere between 800% and 1,000% since I picked them.
Then, in February 2018, the stock market found itself in one of its fastest 10% corrections ever. On the other side of that plunge, I pinpointed Google as a long-term winner. It has soared nearly 300% since then.
And in the summer of 2019, the stock market found itself in another small sell-off. That’s when I pinpointed Tesla Inc. (TSLA) and Nvidia Corp. (NVDA) as great stocks. Since then, Tesla has recorded a max gain of more than 3,700%, while Nvidia has shot up as much as 4,000%.
In other words, I called the Magnificent 7 before they were the Mag 7, and I did so during periods of elevated market volatility.
I don’t say this to brag. Rather, I say this to submit to you a truth that people often forget: Volatility creates opportunity.
Every sell-off feels scary in the moment. But in hindsight, it always looks like a gift.
This time will be no different.
Beneath the surface of the market chaos, the next great tech rally is forming.
However, it’s not forming in the Mag 7 stocks. Those stocks are yesterday’s trade – not tomorrow’s big breakout.
In this next wave, the biggest winners won’t be what I’m calling the MAGA 7. I’m talking “Make AI Great in America” stocks.
AI is already very good in America. But in the next phase of the AI boom, it will become great. We will Make AI Great in America (MAGA) over the next few years.
My MAGA 7 stocks are seven smaller AI companies — several of which you’ve likely never heard of — that are about to ride a wave of federal funding, corporate spending, and reshoring urgency into the spotlight.
They’re building the tools. Laying the fiber. Supplying the chips. Automating the factories. And powering the intelligence behind America’s next great tech renaissance.
And I’m laying it all out at on Thursday, May 1, at 7 p.m. Eastern during my next free broadcast, The Summer Panic Summit (sign up automatically right here)…
The May 7 shock… the $7 trillion panic. the seven little-known AI stocks that I believe will emerge as massive winners thanks to AI acceleration when the smoke clears.
Remember: Volatility creates opportunity. It always has. It always will.
Go here to immediately save your seat for Thursday’s free broadcast event.
See you there.
Good investing,
Luke Lango
Editor, Early Stage Investor