Smart Money Sells Palantir, Quantum Computing, And Space Stocks; Gold Gives Up Momo-Induced Gains

Author: The Arora Report | November 04, 2025 11:25am

Smart Money Making Tactical Changes

Please click here for an enlarged chart of Palantir Technologies Inc (NASDAQ:PLTR).

Note the following:

• This article is about the big picture, not an individual stock.  The chart of PLTR stock is being used to illustrate the point.
• PLTR stock had been running up going into earnings.  The buying in PLTR stock was primarily from the momo crowd.
• The chart shows PLTR stock spiked up on earnings, trading as high as $222.
• The chart shows PLTR stock slowly started falling later in the after hours session and in the early trade this morning.  PLTR stock has fallen to $189.85 as of this writing in the premarket.
• Palantir reported excellent earnings, commentary was excellent, and growth was good.  Here are the details:
  • Earnings came at $0.21 per share vs. $0.17 consensus.
  • Revenues came at $1.18B vs. $1.09B consensus, up 62.8% year-over-year.
  • The company guided Q4 revenues of $1.327B – $1.331B vs. $1.18B consensus.
  • The company guided FY25 revenues of $4.396B – $4.4B vs. $4.14B consensus.
  • U.S. business growth came at 77% year-over-year, and U.S. commercial growth came at 121% year-over-year.
  • Palantir's CEO Alex Karp said, "These are arguably the best results that any software company has ever delivered."
• In spite of all that, why did PLTR stock fall?  It fell because the momo crowd had been running up PLTR stock, and smart money took advantage of the strength to book partial profits.
• As full disclosure, we are long PLTR from $20.15.
• Palantir is a great company, but its stock is one of the most expensive popular stocks in this market.
• Yesterday also saw vicious reversals in other stocks popular among the momo crowd including data center stocks such as IREN Ltd (NASDAQ:IREN), Nebius Group NV (NASDAQ:NBIS), and CoreWeave Inc (NASDAQ:CRWV), nuclear stocks such as Oklo Inc (NYSE:OKLO), quantum computing stocks such as Rigetti Computing Inc (NASDAQ:RGTI), IONQ Inc (NYSE:IONQ), and D-Wave Quantum Inc (NYSE:QBTS), space stocks such as AST SpaceMobile Inc (NASDAQ:ASTS), rare earth stocks such as MP Materials Corp (NYSE:MP), USA Rare Earth Inc (NASDAQ:USAR), and Critical Metals Corp (NASDAQ:CRML).
• Smart money is making tactical changes.  Expect smart money to buy any significant dip as the year end chase is ahead.
• Expect the momo crowd to fight back and aggressively buy their favorite stocks, trying to run them up.  The problem the momo crowd faces is that a big segment of the momo crowd aggressively buys short dated, out of money call options.  Such options can expire worthless, causing havoc with momo accounts unless there is a quick snap back in momo stocks.
• The hearing before the Supreme Court on Trump tariffs is tomorrow.  The Supreme Court's ruling can potentially have a major impact on the stock market.

Magnificent Seven Money Flows

Most portfolios are now heavily concentrated in the Mag 7 stocks.  For this reason, it is important to pay attention to early money flows in the Mag 7 stocks on a daily basis.

In the early trade, money flows are negative in Apple Inc (NASDAQ:AAPL), Amazon.com, Inc. (NASDAQ:AMZN), Alphabet Inc Class C (NASDAQ:GOOG), Meta Platforms Inc (NASDAQ:META), Microsoft Corp (NASDAQ:MSFT), NVIDIA Corp (NASDAQ:NVDA), and Tesla Inc (NASDAQ:TSLA).

In the early trade, money flows are negative in SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust Series 1 (NASDAQ:QQQ).

Momo Crowd And Smart Money In Stocks

Investors can gain an edge by knowing money flows in SPY and QQQ.  Investors can get a bigger edge by knowing when smart money is buying stocks, gold, and oil.  The most popular ETF for gold is SPDR Gold Trust (NYSE:GLD).  The most popular ETF for silver is iShares Silver Trust (SLV).  The most popular ETF for oil is United States Oil ETF (USO).

Gold

Gold has fallen below $4000.  You may recall that we shared that after gold crossed $4000, momo gurus who had never recommended gold before came out of the woodwork and started urging their followers to aggressively buy gold.  Gold is essentially giving up the gains from momo buying.  

Bitcoin

Bitcoin (CRYPTO: BTC) is seeing selling along with speculative momo crowd stocks.  The psychological support level of $100K is nearby.

What To Do Now

Consider continuing to hold good, very long term, existing positions. Based on individual risk preference, consider a protection band consisting of cash or Treasury bills or short-term tactical trades as well as short to medium term hedges and short term hedges. This is a good way to protect yourself and participate in the upside at the same time.

You can determine your protection bands by adding cash to hedges.  The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive.  If you do not hedge, the total cash level should be more than stated above but significantly less than cash plus hedges.

A protection band of 0% would be very bullish and would indicate full investment with 0% in cash.  A protection band of 100% would be very bearish and would indicate a need for aggressive protection with cash and hedges or aggressive short selling.

It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.  When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.  High beta stocks are the ones that move more than the market.

Traditional 60/40 Portfolio

Probability based risk reward adjusted for inflation does not favor long duration strategic bond allocation at this time.

Those who want to stick to traditional 60% allocation to stocks and 40% to bonds may consider focusing on only high quality bonds and bonds of five year duration or less.  Those willing to bring sophistication to their investing may consider using bond ETFs as tactical positions and not strategic positions at this time.

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The Arora Report is known for its accurate calls. The Arora Report correctly called the big artificial intelligence rally before anyone else, the new bull market of 2023, the bear market of 2022, new stock market highs right after the virus low in 2020, the virus drop in 2020, the DJIA rally to 30,000 when it was trading at 16,000, the start of a mega bull market in 2009, and the financial crash of 2008. Please click here to sign up for a free forever Generate Wealth Newsletter.

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Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.

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