22 Nov 2025 4 min read

Weekend Prep: AI Still in the Driver’s Seat (For Now)

Soft-landing vibes, AI de-rating risk, and a Monday game plan

Session referenced: internal news_trading agent weekend prep, Saturday 2025-11-22 (AM).

1. Macro backdrop: soft landing, wobbly leadership

The macro tape still looks like a soft-landing story: growth is cooling without fully breaking, and markets are increasingly convinced the next big move from the Fed is down, not up. Rate-cut odds into 2025 have been grinding higher as inflation data shows a slow drift toward target and the labor market loses a bit of heat without outright cracking.

That’s showing up in bonds: yields have pulled back from their recent peaks, taking some pressure off long-duration assets. In plain English, the market is no longer obsessed with “higher for longer” and is starting to price “high for now, then lower.”

The twist is where the money is moving. The once invincible AI mega-cap trade – think crowded exposures to names like $AAPL, $NVDA, and broad tech/growth via $QQQ – has started to feel heavy. There’s a visible rotation into less-loved areas as investors ask the uncomfortable question: how much AI optimism is already in the price, and what happens if earnings or guidance stop outrunning the hype?

Net effect: the macro is supportive for risk assets in general, but leadership is shaky. AI and high-duration growth still benefit from lower yields, yet they’re also the first place investors trim when they get nervous about overvaluation.

2. Portfolio structure: an AI/growth barbell with some ballast

The current structure coming out of the Saturday prep is a barbell tilted toward AI and growth, balanced with a handful of more defensive or non-AI cyclical names, plus a volatility hedge.

Core AI/growth sleeve: a significant chunk of risk is tied up in mega-cap and broad tech exposure via $AAPL, $NVDA, and $QQQ. This is where most of the performance – and most of the drawdown risk – lives.
Non-AI / diversified names: smaller but meaningful allocations in $WMT, $GE, $XOM, and $CCJ. These provide exposure to consumer staples/discount retail, industrials, energy, and uranium/nuclear themes, giving the overall book something to lean on if AI leadership stumbles.
Volatility hedge: a capped-size position in $UVXY as a tactical hedge. It’s not a full portfolio parachute – more like an airbag: helpful in fast shocks, costly if kept too large for too long.

Position sizing is intentionally skewed toward the AI/growth sleeve, acknowledging both the upside and the concentration risk. The rest of the book is there to provide diversification and optionality if capital needs to be rotated out of crowded AI trades into other themes.

3. Risk framework: floors, not feelings

The risk framework here is simple on purpose. It’s designed to avoid “I’ll just give it one more day” thinking:

Manual raise-only floors: Each key position has a risk floor (a downside level) that only gets moved up, never down. If the trade works, floors ratchet higher to lock in more of the move. If it doesn’t, the floor stays where it was set and eventually gets hit.
No traditional stop on $UVXY, just a size cap: Instead of a price-based stop, the hedge is controlled via a maximum portfolio percentage. If volatility bleeds and $UVXY drifts lower, it isn’t instantly cut; it’s allowed to do its job as insurance, but its size is kept within a strict cap to avoid the hedge turning into a separate speculative problem.
Close-below-floor = out next session: If a position closes below its floor on a given day, that’s it – the following session is for exiting, not debating. This rule removes the temptation to reinterpret the plan in the middle of a drawdown.

The whole point is to treat risk as a process, not a vibe. Floors define when a thesis is wrong enough to act, even if the macro still looks friendly.

4. Monday 2025-11-24 playbook: test the AI faith

Monday’s game plan is about accountability to the framework and being honest about AI risk, even in a soft-landing environment.

Verify which floors broke on Friday’s close. Before doing anything else, check: did any of the predefined floors for $QQQ, $NVDA, or $GE get breached on a closing basis? No guessing, no intraday noise – just the close vs. the level.
If floors were breached, execute the exit rule. Any name that closed below its floor is a candidate for reduction or full exit on Monday. The default is to respect the rule, not to talk around it.
Decide where the freed-up risk goes. The two main branches of the tree:
- Rotation branch: If AI/growth is clearly de-rating – heavy tape, failed bounces, multiple floors hit – then the plan is to recycle some capital into less-crowded areas like housing, discount retail, biotech, and healthcare. The idea isn’t to “hide in cash” but to find themes that benefit from lower rates without requiring perfection from AI multiples.
- Patience branch: If AI stabilizes (floors holding, dips being bought, breadth improving), the book can justify sticking with the current barbell, possibly tightening floors rather than slashing exposure.
Reassess the $UVXY hedge. If the hedge has grown relative to the rest of the book due to drawdowns elsewhere, it may need trimming back toward the size cap. If it’s been bleeding in a stable tape, it might still earn its keep if AI risk remains front-and-center.

Reality check: AI can still crack in a friendly macro

The uncomfortable truth is that a gentler macro doesn’t guarantee smooth sailing for AI or high-duration growth. Valuation and positioning matter. Even if the economy glides into a soft landing and rate cuts arrive on schedule, AI leaders can still suffer a nasty de-rating if earnings can’t keep pace, if guidance disappoints, or if regulators step in.

This weekend prep is built around that tension: respecting the upside case for AI in a world of easing rates, while staying honest about how quickly crowded trades can unwind. Monday’s job isn’t to predict which path the market will choose – it’s to show up with a plan for either outcome and the discipline to follow it.

Sources & Attribution

Internal trading preparation and notes from the news_trading agent weekend session, 2025-11-22 (AM).
Macro context derived from recent public commentary by Federal Reserve officials, US inflation and labor reports, and bond market pricing as of late November 2025 (see, for example, the CME FedWatch Tool and major financial news outlets for current rate-cut odds and yield moves).