Global Stocks Hit Peaks: S&P 500 +6.2%, Nasdaq +6.7% - AI Euphoria or Bubble?

Hey fellow traders! Tram here, just closed my US equity positions and sitting here with my iced tea, looking back at the past 4 weeks and just shaking my head. S&P 500 up 6.2%, Nasdaq up 6.7% - numbers that 6 months ago everyone thought were "impossible" are now happening right before our eyes.But the big question that I and many traders are asking ourselves: is this a sustainable rally or are we in a massive "AI bubble"?

US Markets: "Unbelievable" Numbers

S&P 500 and Nasdaq - The "Perfect" Duo

Past 4 weeks:

• S&P 500: +6.2% (new all-time highs)
• Nasdaq: +6.7% (tech stocks leading)
• Volume: significant increase, showing institutional money participation

Analysis from trading experience: When both S&P 500 and Nasdaq surge like this, there are usually 2 main reasons:

Fundamentals are genuinely good - economy is recovering strongly

Euphoria phase - market is in a frenzy stageFrom what I'm observing, we have both.

Driving Forces: AI Revolution or AI Hype?

The Artificial Intelligence Story Is "Making Waves"

What's happening:

• Major tech companies reporting explosive AI revenue growth
• Expectations that AI will completely transform business operations
• Investors are "going all-in" on AI-related stocks

Personal perspective: I've witnessed many "revolutions" before - dot-com bubble in 2000, crypto boom 2017, and now AI. The pattern is always the same: technology truly has potential, but markets usually overvalue in the short term.

Positive Economic Data - Solid Foundation?

Supporting factors:

• US GDP growth exceeding expectations
• Inflation continues to decline, creating space for Fed
• Labor market remains stable
• Corporate earnings better than expected

Trading insight: When fundamentals and sentiment are both positive, markets can rise more "irrationally" than we think. But this also creates higher risks.

Europe and UK: "Dancing to the Same Tune"

European Markets - Indirect Beneficiaries

Positive factors:

• Declining inflation: ECB may slow rate hikes
• Optimistic trade sentiment: hopes of avoiding trade war
• Spillover effect: when US rises, Europe usually follows

Observation from charts: European markets are rising more "gently" than the US, showing more caution. This could be a positive sign - less likely to be a bubble.

United Kingdom - Brexit "Gradually Forgotten"

Interestingly, UK markets are also participating in this rally, showing investors have "moved on" from Brexit concerns. A stronger pound also supports positive sentiment.

Biggest Risk: July 9th - "Sword of Damocles"

Trump Tariff Deadline - "Black Swan" Factor

Current situation:

• Trump has set July 9th deadline for trade agreements
• Markets are "holding their breath" waiting for results
• If no deal → Trade War 2.0 → market crash could occur

Risk/reward analysis:

• Best case: Deal signed → market could rally another 2-3%
• Worst case: Trade war erupts → 10-15% correction in weeks

Trading experience tells me: When markets are at peaks and have a major catalyst like this, volatility will be very high regardless of outcome.

Technical Analysis: What Charts Are "Saying"

S&P 500 Technical View:

Positives:

• Continuously making new highs
• Volume increasing with price increases