One lesson that 2024 has taught us is that Technology stocks are still the driving force of Wall Street, and it seems that Wall Street is also unwilling to doubt them in 2025.

Steven Jon Kaplan, the CEO of the True Contrarian blog and newsletter, made a contrarian bet on technology stocks earlier this year. Although this prediction has not materialized yet, he stands by his view, believing that the current bubble is even greater. His successful track record includes suggesting to Buy during the pandemic sell-off in 2020 and accurately predicting some technology stock sell-offs in recent years.

In April, Kaplan predicted that the Exchange Traded Fund would fall to 300 points within a year and drop below 100 points in three years. The Index has risen from 427 points at that time to 522 points.$NASDAQ 100 Index (.NDX.US)$of the Exchange Traded Fund$Invesco QQQ Trust (QQQ.US)$ The Index has risen from 427 points at that time to 522 points.

Kaplan said, "I still believe that at some point in 2025, we will see QQQ below 300 points," which means a possible 50% decline from current levels. He has been periodically shorting QQQ this year.

He expressed concerns about overly optimistic expectations for company profits and increasing evidence that spending by large technology companies on AI has not translated into substantial profits.

Kaplan pointed out that powerful hedge funds may start to Sell, as these hedge funds account for a large proportion of daily Technology stock Volume. He noted that during the internet bubble burst in 2000, there was no obvious trigger for the crash, "except eventually a few people began to Sell."

Currently, most hedge funds follow "trend algorithms," which means that if an index like QQQ eventually falls by 20%, trillions of dollars in funds will simultaneously Sell, he said. If QQQ drops to 360 points, the first wave of selling may arrive - Commodity.Futures Trading Commission (CFTC)'s latest data shows that investors are significantly reducing their net short positions in US soybean, corn, and wheat contracts, easing bearish sentiment in the market.The committee's data is a place where he observes hedge fund activities.

Kaplan also noted the selling behavior of company insiders this year, such as$NVIDIA (NVDA.US)$、$Microsoft (MSFT.US)$、 $Apple (AAPL.US)$ 、$Amazon (AMZN.US)$、$Costco (COST.US)$and$Walmart (WMT.US)$He noticed that insider selling reached a historical high in July, eased somewhat in August, but again exceeded historical records in November and December.

He said: "This is a very large number, and this trend has expanded from large tech stocks to many other components; many other large companies in the USA are also experiencing this."

So where is Kaplan now investing his money? He believes it is being seen as a 'boring investment'.$iShares 20+ Year Treasury Bond ETF (TLT.US)$The ETF price dropped from $180 in March 2020 to the current $87. He expects that large-scale shifts to TLT will only occur when investors begin to see losses in the stock market.

He also through $Abrdn Palladium ETF Trust (PALL.US)$ Invest in Palladium, as large hedge funds have been shorting this metal. "People still need essential items like Fuel Cell Energy and Autos, which require Palladium, making it a truly forgotten good Buy," he said.

According to his analysis, the current bear market may have already begun. He traces the current bull market back to March 2009, with previous bull markets lasting from October 1990 to March 2000 and from August 1921 to September 1929. The subsequent bear markets lasted 31 months and 34 months respectively, so he estimates that the next bear market will bottom out in the second half of 2027, starting another round of strong bull markets.

A rebound may occur beforehand—possibly a significant rebound next summer, followed by another decline. "It will essentially confuse a large number of investors through repeated ups and downs, just like what happened between 2000 and 2002," he said.

After the market crash, large technology stocks and well-known stocks may perform prominently due to negative memories of investors. In contrast, he suggests focusing on the winners from 2002 to 2007: "Emerging Markets, Golden Minerals stocks, Commodity producers, and small to medium-sized stocks, rather than large stocks."

Editor/Rocky