Amazon’s earnings fell short of expectations, marking a tough day for global markets. This slump was worsened by the company’s announcement to invest $200 billion in the AI race, surpassing Alphabet’s planned spending.<\/p>\n
The stock market reacted negatively to Amazon’s performance, especially following Alphabet’s recent financial results. The impact spread beyond tech stocks, affecting the broader market as the crypto selloff began to influence commodities and equities. <\/p>\n
Bitcoin’s decline continued, with silver prices also dropping further. The tech sector’s challenges seem set to affect other areas, as financial markets face uncertainty.<\/p>\n
We remember the market shock following Amazon’s earnings miss in late 2025, which, combined with its aggressive AI spending plans, triggered a broad tech downturn. That memory is important now, as the CBOE Volatility Index (VIX) has just ticked back above 22, indicating rising market anxiety. This nervousness suggests that any negative catalyst could have an outsized impact in the coming weeks.<\/p>\n
Given the precedent from 2025 for tech weakness to spread, we believe buying put options on the Nasdaq-100 ETF (QQQ) is a sensible hedge. Recent reports showing a slowdown in corporate cloud spending for Q4 2025 echo the conditions that preceded the last downturn. A review of options data shows a significant increase in the put-to-call ratio on major tech names over the last five trading sessions, moving from 0.7 to 0.9.<\/p>\n
The contagion we saw hit commodities last year, particularly silver, should also be on our radar. Silver has struggled to recover, currently down 4% year-to-date, and remains vulnerable to a risk-off sentiment driven by equity markets. Therefore, traders might consider short-selling futures contracts or buying puts on silver ETFs as a way to profit from another potential market-wide slump.<\/p>\n
The announcement of Amazon’s $200 billion AI investment in 2025 created short-term pain but long-term potential. This sets up a potential pairs trade, going long on AI-infrastructure beneficiaries like Nvidia while simultaneously buying puts on broader consumer discretionary ETFs that could suffer from tightened spending. Historical data from 2024-2025 shows that during periods of high tech investment, semiconductor stocks often outperform the broader market by as much as 15% over the following six months.<\/p>\n
Finally, the sharp downturn last year created significant volatility, which itself is a tradable asset. Implied volatility across the tech sector is currently higher than its historical average for February, reflecting the market\u2019s memory of 2025’s events. This makes strategies like long straddles on stocks with upcoming earnings announcements particularly interesting, as they can profit from a large price move in either direction.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" Amazon’s earnings miss and AI investment triggered broader market declines, impacting tech, crypto, and commodity sectors.<\/p>\n","protected":false},"author":62,"featured_media":16986,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-41104","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/41104","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/comments?post=41104"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/41104\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media\/16986"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media?parent=41104"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/categories?post=41104"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/tags?post=41104"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}