More On The Explosive Bull Market Thesis

This is an intriguing chart. The Coppock indicator is close to zero and showing signs of curving higher. Previous signals have worked well. A substantial consolidation has formed on the candlestick chart, stretching back over 16 months. This is so tight that it looks like a line, one of the strongest chart patterns. A breakout would be an exciting development. Last but not least is the secular trend going back over 15 years on this chart and further on other charts, which is strongly higher.

The question is how the fundamentals might tie in with the chart. Some observers are looking for the AI infrastructure boom and associated excitement to end soon, with a depressing effect on share prices. Most CEOs think differently, arguing that the boom is just beginning and that an era of spectacular technological progress lies ahead.

If they are right, and my layman’s best guess is that they are, this could trigger the bull charge I am looking for with growing public participation. If you have never experienced a raging bull market, it is not called a mania for nothing.

At the moment, everybody is paying lip service to this AI boom, but for most people, their experience is mostly smarter answers to questions. At some point, though, this vast spending needs to deliver, and we can expect autonomous vehicles, unmanned warfare, dramatically accelerated space exploration, landings on Mars, robots, smart cities, software-controlled factories and other wonders.

This, in turn, is likely to have an electrifying impact on the stock market, with many new companies attracting investors looking for anything to do with AI. Exciting stocks like Palantir and Coreweave could be just the beginning as a flood of exciting new IPOs come to market.

An Old Favourite Reports Stunning Figures

I am adding another stock to my Top 10, which becomes a Top 12. I am tempted to say a Dirty Dozen after the iconic war film, but perhaps the associations are not ideal. The present 11 are:- Palantir, Nvidia, Coreweave, Microstrategy, Microsoft, Netflix, Spotify, Sezzle, Dave Inc, Carvana and Crowdstrike (reporting after hours today). The new entry, already the subject of numerous recommendations, is Credo Technology.

Credo perfectly illustrates Warren Buffett’s comments about buying shares being like going into partnership with a manic depressive. As investors became aware of how fast Credo was growing (CEO Bill Brennan spoke of an inflection point), the shares soared as high as $86 before falling back to around $29. Since they have again rallied strongly, including reporting another impressive set of results.

Bill Brennan, Credo’s President and Chief Executive Officer, stated, “I’m proud of Credo’s achievements in fiscal 2025. For the year, the Company delivered record-breaking financial results, with revenue up 126% year over year to $436.8 million. The Company’s results were fueled by surging demand for our innovative, reliable, and energy-efficient high-performance connectivity solutions. We continue to see growing demand for our solutions across hyperscaler customers to power advanced AI services, a trend we believe will persist for the foreseeable future.”

Bill Brennan, CEO, Credo Technology, Q4 2025, 2 June 2025

The company is buzzing.

Our innovation spans three tiers: advanced service technology, cutting-edge integrated circuit design, and comprehensive system-level solutions. These innovations are seamlessly integrated with our PILOT software platform. PILOT is an acronym for Predictive Integrity, Link Optimization, Telemetry. PILOT offers an industry-leading user interface, robust debugging tools, and advanced telemetry tailored for large-scale deployments. This holistic innovation strategy enables Credo Technology Group Holding Ltd to deliver copper and optical connectivity solutions that surpass industry standards, providing unmatched functionality, reliability, and energy efficiency. While achieving a remarkable revenue ramp in fiscal 2025, we continue to build the foundation for sustained growth.

Looking ahead, we anticipate increasing customer diversification across copper and optical connectivity for Ethernet, PCIe, UA link, and other emerging applications in both scale-out and scale-up AI networks. Following this significant revenue inflection in fiscal 2025, we’re energized by the expanding opportunities and total addressable market that lie ahead.

Bill Brennan, CEO, Credo Technology, Q4 2025, 2 June 2025

Everything appears set for continued explosive growth.

When we pioneered the AEC [active electrical cable] market years ago, we recognized the compelling advantages over both traditional direct-attached cables or DACs and laser-based optical solutions, especially at data rates of 50 gig per lane or higher. AECs have extended the viability of copper connectivity, becoming the de facto standard for inter-rack applications. Compared to DACs, AECs deliver superior signal integrity, advanced features, and a more versatile form factor. Now, AECs are gaining traction as a robust rack-to-rack solution for distances up to seven meters, offering over 100 times greater reliability than laser-based optical modules, virtually eliminating link flaps and significantly improving energy efficiency, which were both key enablers for best-in-class AI deployments.

Credo Technology Group Holding Ltd’s system-level approach has driven substantial competitive advantages by owning the entire solution stack, including SERDES IP, retimer ICs, system-level design, qualification, and production. Our approach positions Credo Technology Group Holding Ltd for significant innovation and time-to-market advantages. As data center architectures evolve rapidly, we foresee a continued shift towards curated system-level solutions. We’re enthusiastic about the ongoing expansion of the AEC market. For instance, our recently demonstrated PCIe Gen 6 AECs at GTC promise the same compelling benefits for AI scale networks as deployments transition to rack-scale architectures. Our growing traction with hyperscalers is evident, with strong customer forecasts and new design wins and qualifications. We’re confident in sustained AEC revenue growth.

Bill Brennan, CEO, Credo Technology, Q4 2025, 2 June 2025

I often think investors should pay more attention to what the CEO is saying and less to obsessive attempts to read the tea leaves.

In summary, fiscal 2025 marked a pivotal year for Credo Technology Group Holding Ltd, achieving record revenue, profit, and market adoption of our innovative connectivity solutions, hitting the inflection point we anticipated. Our operational and customer-facing teams executed flawlessly to deliver these results. Credo Technology Group Holding Ltd pioneered a market that transformed how hyperscalers connect switches and servers. We continue to innovate with recent product announcements reflecting customer-driven solutions. These advancements position us to capture significant opportunities in the global AI infrastructure investment wave, fueling our next phase of growth. Reflecting on our journey, Credo Technology Group Holding Ltd has navigated successes and challenges with relentless focus on delivering world-class products.

This resilience defines our DNA and is our greatest strength.

Bill Brennan, CEO, Credo Technology, Q4 2025, 2 June 2025

I am keeping a close eye on Nvidia. The chart looks promising with Coppock approaching negative territory and the shares breaking higher after a bunching of the moving averages. The negative overhanging Nvidia is the potential loss of its Chinese market because of Trump and his tariffs.

Jensen Huang makes an excellent case for Nvidia and America benefiting from access to the huge Chinese market. There is no way of stopping China from making technological progress. America needs to accept that and make sure that while it happens, America remains at the forefront of technology, with immensely powerful and patriotic companies like Nvidia becoming as strong as they can.

It also makes sense to entwine the American and Chinese economies and create a mutual dependency. The Americans are entitled to expect better access to China’s growing market to reflect the access that China has to the huge American market; that is what they should be battling for. I think the Trump administration’s stance on China will soften, and Nvidia shares will react positively.

Meanwhile, investors should never forget that Nvidia is a fabulous company, arguably the greatest technology company yet created.

Share Recommendations

Credo Technology. CRDO

Nvidia. NVDA

Strategy – Stay Positive

Whoever knows when a simmering pot is going to boil, at least back in the day when they could take ages, but I think this market is simmering. Trump will want, above everything, for his presidency to be validated by a rising stock market and a booming US economy. He is going to pull every lever to make that happen, and he will know that increasingly it is all about technology.

Stock markets seem to be endlessly two steps forward, one step back, but they get there in the end; at least in America, they do.