"NEW HIGHS BEGET NEW HIGHS" - Multiple Indices Break Out, DRAM News Ignites Storage

 

📅 Tuesday, January 6, 2026

"NEW HIGHS BEGET NEW HIGHS" - Multiple Indices Break Out, DRAM News Ignites Storage

Market Action (Breakout Day!)

• Dow: New all-time high
• Mid-cap 400: New all-time high
• Semiconductor Index (SOX): New high, +3%
• Financials (XLF): New high (past 2 days)
• Banking Index (KBWB): New highs
• S&P 500: Got above old high (500 names)
• Transports: New weekly closing high
• NASDAQ: +151, NASDAQ 100: +238
• Russell 2000: Held 50-day, getting close to highs (above old 2024/2021 highs)
• New Yearly Highs: "Expanded markedly"

Gary: "If these breakouts to new highs stick, duh, we're going higher."

🔥 POWELL REVERSAL: QE RESTART

MAJOR NEWS:

• Jay Powell stopped quantitative tightening
• No longer letting bonds run off - now buying more bonds
• Fed balance sheet went to $9 trillion, was running off, now staying/growing

Gary: "J-Powell just announced and is now putting into place no more quantitative tightening. So if a bond matures, he's buying more bonds."

"And guess what the market loves? Buying bonds. It's called liquidity."

"The market has expanded, not just in the New Yearly Highs, but in areas that were dormant."

"Remember, for a long time we were telling you to avoid this, this, this, this, this, this, this, and this. And then all of a sudden we came out and said you don't have to avoid this, this, this, and this anymore. They're turning the corner type of thing. And that's what went on. And that's what's going on now."

🚀 DRAM PRICE HIKE NEWS - STORAGE STOCKS EXPLODE

THE CATALYST: Samsung and SK Hynix seeking up to 70% server DRAM price hikes - "demand outstripping supply like crazy"

BENEFICIARIES - MASSIVE MOVES:

• SanDisk: Up 27% - "I don't think they know what hit them"
• Lumentum: $340 → $397, up $40
• Seagate: Up 14% into new highs
• Western Digital: Up 16% into new highs
• Micron: Up 10%
• Semiconductor Equipment Makers: Up 3-4%

Gary: "Another gap in move... What are the benefactors of higher DRAM prices? As we have told you, Micron, SanDisk, Seagate, Western Digital, and should be also electronic contract manufacturers and the semiconductor equipment companies because they're saying there's going to be a lot of building."

📉 OIL SECTOR: REVERSAL

Gary's Stance: "AGNOSTIC"

Gary: "I got asked in the last day, it was about oils. And you know what I said to everybody? I'm agnostic. I'm agnostic."

"The reason agnostic is, I think there's just so many moving parts, I'm pretty sure it's going to take a couple of years [for Venezuela]. And we still don't know how this is going to play out."

Yesterday's Winners = Today's Losers:

• Chevron: Down $7+ (gave back whole move from yesterday)
• Marathon Petroleum: Down $4.50
• Phillips 66: Down $3.50
• Valero: Down $2+ (not as bad)

Gary's Oil Price View: "I just don't think oil prices are going higher a lot. If anything, I think they're going to go lower. That's my overall thought."

"You've got a president that wants to drill baby drill... And in case you don't know, the production of oil under Biden was fine."

Resistance Levels (USO): Would need to break $70.58, then $72.34, then $74.25, then $78.32, then $81.13, then $83.57, then $84.58, then $92.20, then $106.56, then $129.90

Gary: "We don't have to wonder or listen to what anybody believes or what anybody predicts. All we have to do is watch price."

💀 TESLA: Down $20

• Down $20 today
• "So far in 2026, Tesla is down $20"
• "Everybody's saying buy it because of robots and driverless stuff, but there's tremendous competition in robots and driverless stuff"
• Car numbers terrible
• "I know some fundamentalists that think this stock is worth 50% lower. I know some that say it's going to $3,000"

Gary: "And some pretty smart people will let the market decide."

🔴 DOW COMPONENTS: The Weak Links

APPLE - "VERY WEAK"

• Down $5 with NASDAQ +151, NASDAQ 100 +238
• "Breaking the 50-day badly now. Wow."

ALSO WEAK:

• Home Depot: "Bear market, stay away"
• Coca-Cola: "That whole food, drug, beverage, tobacco, household products, just bear market or comatose"
• Chevron: Had couple good days, "right back down today"
• Salesforce.com: "Big bear market, trying to come out of it"

EMERGING:

• Amazon: "Been doing nothing for a year, but was up $8 today and may start to emerge"

📊 DOW MATH LESSON (Price-Weighted)

Gary's Example:

• Verizon (lowest price, $40.30): Going to zero = only 262 Dow points
• Goldman Sachs: Going to zero = 6,207 points
• Goldman 23-24 times more important than Verizon

Gary: "When it comes to the Dow Index, it's imperative you pay attention to the higher-priced names."

"Nike has earned that lower price by dropping, hit a high of 180 back in 21. It's now 65 today."

🟢 AREAS IMPROVING/STRONG

TRAVEL/LEISURE:

• Airlines: "Much better"
• Cruise lines: "Much better"
• Hotels: "Much better"
• Marriott: Broke to new high ground at close

FINANCIALS:

• Banks, regionals, SNLs all at new highs
• "If they ain't going near them" holding, no bear market risk

SEMICONDUCTORS:

• SOX new high, +3%
• Data storage exploding (see above)
• Equipment makers strong

METALS:

• Silver: Into new high ground today
• Gold, platinum, palladium all strong
• "They've been gapping up and gapping down like crazy"
• Gary thought it was sign of top, "Nah. Silver went into new high ground today"

BROADER MARKET:

• "We're broader based, which means more areas of the market in participation"

🔴 AREAS STILL WEAK/AVOID

BEAR MARKETS:

• Housing stocks
• Payroll stocks (ADP, Paychecks)
• Food, beverage, tobacco, household products, alcohol - "We ain't going near them"
• Oils (Gary agnostic, staying away)

📈 GARY'S "NEW HIGHS BEGET NEW HIGHS" THEME

The Philosophy: "New highs beget new highs. When a stock goes into new highs, that's good. When a group and its chart goes into new highs, that's better for the stocks in that group. When an index goes into new highs, that's good for a lot, depending on what that index is."

"If you're going to get a double and a triple, if you're going to get a 20% move... if you're going to get a big monster move, it's usually going to hit a certain list, and that's the new yearly high list. And that's why we talk about it."

Multiple Indices Breaking Out:

• Dow (all-time high)
• Mid-cap 400 (all-time high)
• SOX (new high)
• Financials (new high)
• Banks (new high)
• S&P above old high
• Transports (weekly closing high)

Gary: "If new highs stick, we're going higher. Duh."

"If they tuck in like a frightened turtle, we'll be telling you."

📊 KEY LEVELS TO WATCH (If Breakouts Fail)

S&P 500 (currently 69.44): Would need to break:

• 68.14
• Then 67.20
• Then 65.50

XLF (Financials): Would need to break:

• 54.34
• Then 52.64
• Then 51.08

Gary: "We don't have to listen to anybody. Follow the markets. They'll tell us everything."

Gary's Key Quotes

On New Highs: "New highs beget new highs."

"If these breakouts to new highs stick, duh, we're going higher."

"If they tuck in like a frightened turtle, we'll be telling you."

On Powell/QE: "J-Powell just announced and is now putting into place no more quantitative tightening... he's buying more bonds. And guess what the market loves? Buying bonds. It's called liquidity."

On Market Following: "We don't have to wonder or listen to what anybody believes or what anybody predicts. All we have to do is watch price."

"We don't have to listen to anybody. Follow the markets. They'll tell us everything."

On Oils: "I got asked in the last day, it was about oils. And you know what I said to everybody? I'm agnostic. I'm agnostic."

"I just don't think oil prices are going higher a lot. If anything, I think they're going to go lower."

On Biden Oil Production: "In case you don't know, the production of oil under Biden was fine. You know, the Trumps and the right were complaining about him, but they were drilling."

On DRAM News: "I don't think they know what hit them" (SanDisk +27%)

On Apple: "Apple, very weak, breaking the 50-day badly now. Wow, NASDAQ was up 151 today. The NASDAQ 100 was up 238, and Apple was down 5 bucks."

On Broader Market: "We're broader based, which means more areas of the market in participation. If that changes, we'll let you know. If anything tops out, we'll let you know."

On Powell History: "Remember all that printed money that Ben Bernanke said would only be temporary? Remember all that printed money Jay Powell printed all the way to $9 trillion freaking dollars?"

"He bought the living hell out of bonds... And all that money and its unimaginable amount took the 10-year yield down to a half percent. That got you your mortgages 3 percent lower."

"You know all this complaint from Trump on Powell? He should be kissing his butt. Any of you with those low mortgages should be kissing his butt."

"It was an artificial move by one man and his whims that got you that 3 percent. But it wasn't going to last. Why? Because he created all that freaking inflation. It was him."

On Tesla: "So far in 2026, Tesla is down $20... In order to be the best stock of 2026, it'll have to get that $20 first and then so on and so forth."

On Predictions: "I must tell you, you know what the favorite stock of 2026 for a bunch of people that I saw was Tesla. So far in 2026, Tesla is down $20. That's all."

On Market Environment: "Anybody who thinks the economy's going into the dumps, they ain't watching the market."

On What We Know: "There's too many variables. What we do know is you have some lower taxes. What we do know is we don't think the president's ever going back to Liberation Day tariffs. What we do know is that yields have been stable. What we do know is oil prices have been coming down for a year."

On Areas Coming Back: "Remember, for a long time we were telling you to avoid this, this, this, this, this, this, this, and this. And then all of a sudden we came out and said you don't have to avoid this, this, this, and this anymore. They're turning the corner type of thing."

What to Watch

CRITICAL FOLLOW-THROUGH:

• Do the new highs in Dow, mid-caps, SOX, financials, banks hold?
• Or do they "tuck in like a frightened turtle"?

KEY LEVELS:

• S&P 68.14 (support if fails)
• Apple 50-day (badly broken)
• 10-year yield (currently stable)

SECTOR ROTATION:

• Storage/DRAM names continuing?
• Airlines/cruise/hotels strengthening further?
• Apple weakness spreading to other mega caps?

POWELL'S QE RESTART:

• Does liquidity injection continue to broaden market?
• Areas that were dormant continuing to wake up?

Bottom Line: Multiple indices breaking to new highs on Powell QE restart + DRAM price hike news. Storage stocks exploding (SanDisk +27%!). Gary's rule: "New highs beget new highs" - if they stick, going higher. If they fail, he'll let us know. Market broadening, more areas participating. Apple breaking down badly. Oils reversing yesterday's gains. Gary "agnostic" on oils, thinks they're going lower not higher.