- Howie Town
- Posts
- Momentum Monday - Volatility Up, Distribution Up, Anger Up, Blowups Up, Indexes Holding
Momentum Monday - Volatility Up, Distribution Up, Anger Up, Blowups Up, Indexes Holding
Howard Lindzon
February 17, 2026
As a reminder, MarketSurge (by Investor’s Business Daily) is a sponsor of the weekly show. All the charts you have been seeing in the videos and will continue to see are from MarketSurge. They are offering my readers 2 months for $59.95 - save $239. That's 80% off the most powerful stock research platform for individual investors.
Good morning,
I hope everyone had a nice long weekend.
As always, Ivanhoff and I toured the markets looking for trends and momentum.
The rotation out of software stocks and the Mag 7 stocks has been pretty violent as you can see from the chart below. The indexes have shaken it of…for now.
The $VIX closed over 20 for the first time in a while.
Energy stocks are carrying most of the momentum right now and I have shared that I own some $XLE (the energy ETF) and Ivanhoff points out that most energy stocks move together.
We shared a few new ideas as well. I hope you enjoy the show and please do subscribe on Youtube….
Welcome back to Momentum Monday!
In today’s episode of Momentum Monday, Ivanhoff and I discuss the following:
Market Introduction and Tech Distribution
Software Sector Repricing and AI Impact
Defensive Rotation: Staples vs. Discretionary
Energy Sector Momentum and XLE
Big Tech Leaders and Earnings Fades
AI Infrastructure and Generac Pivot
In This Episode, We Cover:
Here are Ivanhoff’s thoughts:
The stock market price action might seem irrational at the extremes, but there’s a method behind the madness. Take the biggest force of the past three years – AI has changed many companies’ destinies. Software has been under pressure over the past few months because the market has realized that AI could depress software companies’ margins, and therefore, they should trade at lower multiples. The odds are that the days when SaaS stocks can trade at 20, 30, 50 times their sales are gone. Since AI is likely to improve the margins for most other industries (productivity rises, fewer employees are needed), they might deserve to trade at higher multiples. This can explain the rotation into industrials, energy, financials, and transportation stocks year-to-date.
In the meantime, the only stocks that are receiving favorable market treatment when they report earnings are AI infrastructure stocks. The vast majority of them gapped up this season. It is a different question that some have not been able to keep their gaps. When the general market is weakening, sooner or later, all stocks are impacted. Keep in mind that the employment growth is at levels typically only seen during recessions. Maybe this is why the major indexes have been piling up distribution days lately, and defensive sectors like consumer staples and utilities are showing relative strength.
And here are the charts discussed:
Reply