Tech Checks In
This Week in the Market
Microsoft, Apple, Amazon, Meta, and Alphabet all reported results that showed a mix of strong revenue growth and cautious guidance. While several companies posted earnings beats, investors still have their concerns regarding AI spend and valuations.
The Federal Reserve cut interest rates by 25 basis points to a range of 3.75 to 4.00 percent, citing slowing job growth and softer consumer spending. Officials framed it as a proactive move to support continued growth while inflation trends lower. This sets the backdrop for the week ahead, with markets building momentum on renewed optimism that lower rates will further fuel corporate investment and strengthen risk appetite across sectors.
Reviewing Past Trade: AMZN
Amazon has rebounded sharply since our initial write-up two weeks ago, validating our pick. The stock went from about $212 a share to about $254 a share, marking about a 20% increase.
Amazon earnings were reported last Thursday and sentiment has shifted as investors refocus on Amazon’s core growth drivers, particularly AWS, which continues to post resilient margins and expanding demand for AI infrastructure.
Amazon operates at the intersection of several transformative industries, including artificial intelligence, robotics, and cloud computing. We still believe there's further upside in the long term but entering now has increased downside.
Prediction Markets - Alternative Alpha
Prediction markets offer a unique way to generate alpha by turning collective intelligence into tradable probabilities. You can place bets on anything from foreign elections to the Oscars. They consolidate information from a wide range of participants, often reacting faster than traditional models or media coverage.
Prediction markets have become an important source of forward-looking insight, Kalshi is the only one currently legal and regulated in the United States, operating under federal oversight, while Polymarket remains offshore and restricted for U.S. users.
In many cases, the “no” side of an event tends to hold more alpha because markets often overvalue dramatic or attention-grabbing outcomes. For example, in the Kalshi market asking whether Trump will be out as president this year, the “yes” contracts trade at a premium due to media noise and speculative sentiment. Taking the “no” side reflects a contrarian, probability-driven approach that benefits from mean reversion as reality sets in, allowing traders to capture steady edge from overpricing of extreme scenarios.
Disclaimer: We own shares of AMZN as of writing this. The content in this newsletter is for informational and educational purposes only and should not be considered financial, investment, or legal advice. A4K Capital and its affiliates are not responsible for any financial losses or decisions made based on the information provided.
