America’s Power Grid Watchdog Just Issued an AI Warning

Listen to the audio version of this article (generated by AI).

 

In This Digest: 

• Why America’s power grid watchdog issued its highest-severity warning  

• Genomics is up 32% in a month – Predictive Alpha is forecasting gains in these three plays 

• The White House just put quantum computing and cybersecurity center stage 

America’s power grid watchdog has issued its highest-severity warning… 

The North American Electric Reliability Corporation (NERC) the nonprofit responsible for keeping the U.S. grid stable – said that AI data centers are growing so fast they now pose a serious threat to the high-voltage network that moves electricity across the country. 

In its own words…  

Computational loads, such as data centers, could increase exponentially in the next four years and there are significant risks to the bulk power system that need to be addressed through immediate industry action. 

These data centers cover hundreds of acres, are packed with the computers that train and operate AI models like ChatGPT, Claude, and Gemini, and run on enormous amounts of electricity.  

One data center recently approved in Utah will need about 9 gigawatts of power – more than twice what the entire state typically uses. (A gigawatt is enough to power about 750,000 homes.) 

The NERC’s concern is that AI demand is growing faster than the grid can absorb it. And it’s easy to understand the concern.  

According to a recently published report by Exponential View, a technology newsletter read by over 100,000 investors and analysts, the extra electricity the U.S. grid is expected to need by 2030 has grown roughly 7x since 2022 – with data centers accounting for roughly 55% of that growth.  

Here at TradeSmith, we’ve shown you how the AI datacenter buildout is running into chokepoints – from the specialized memory chips and fiber-optic connections that AI needs to think and communicate, to the cooling systems that stop these buildings from overheating, to the energy and grid capacity required to keep them running. 

Each one is a critical constraint the AI industry is running into right now. But of all five, energy and the grid are the hardest to fix.  

The most interesting AI plays we’re watching here at TradeSmith aren’t in the trillion-dollar software giants everyone already owns. They’re in the smaller, overlooked companies racing to build the power infrastructure the AI revolution depends on. 

And on Thursday, we’re hosting a special summit to show you what’s at stake and how you can profit. 

This AI power summit is the brainchild of two very different analysts… 

The first is Joel Litman, Chief Investment Officer at our corporate affiliate Altimetry. 

Joel is trained as a forensic accountant. He rebuilds a company’s financial statements from the ground up to find what it actually earns versus what it reports to the public.  

And he’s one of the best in the world. He’s consulted for the FBI and the Pentagon, has lectured at Harvard and Wharton, and he counts the 10 largest money managers on the planet among his clients. 

When his True Blue system catches a company the market has mispriced, the moves that follow can be dramatic.  

We know because we’ve rigorously tested it. In our testing, True Blue flagged: 

• Chipmaker Silicon Motion (SIMO) before a run of more than 1,600% 

• Shoemaker Deckers Outdoor (DECK) before a climb past 3,700% 

• And gene-sequencing firm Illumina (ILMN) ahead of a 4,500% move higher 

Joining Joel is TradeSmith’s Landon Swan, who built the Social Heat Score with his brother, Andy Swan. 

It pulls data from online platforms like X, Facebook, Reddit, and Google to track what hundreds of millions of people are searching for, talking about, and buying online, before any of it shows up in a company’s earnings.  

It distills all of that data into a single number from 0 to 100, called the Social Heat Score. That score has led them to opportunities like small nuclear reactor designer Oklo (OKLO), which climbed 461% after it hit a score of 79… Robinhood (HOOD), which soared 556% after it hit a score of 80, and At Home Group, which rocketed 611% after it hit a perfect score of 100.  

Following this system, 25 of Landon and Andy’s recommendations at our MegaTrends advisory have doubled or more over the past five years. 

This is the first time Joel and the Swans have combined their two systems – forensic earnings analysis on one side, real-time consumer sentiment on the other.  

Both point to the same opportunity: a small group of microcap stocks – companies so small that Wall Street’s largest funds aren’t easily able to buy them – sitting right at the center of the AI energy story. 

Joel and Landon are sharing what they’ve found in it the U.S. AI Super Summit this Thursday, July 2 at 10 a.m. ET —including a bonus AI energy recommendation for everyone who attends. 

Registration is open now. Add your name to lock in your spot and get the details as they’re released. And when you join our VIP list, you’ll receive an exclusive special report detailing an overlooked AI company that Joel and Landon both think has strong potential. 

The genomics trade is roaring back… 

Genomics – the science of mapping and analyzing DNA to understand how genes drive health and disease – is suddenly one of the hottest corners of the market. 

The ARK Genomic Revolution ETF (ARKG), a basket of gene-sequencing, gene-editing, and medical-testing companies, is up about 32% over the past month and hit a 52-week high on Friday.  

And the strength in this sector runs deeper than one fund.  

“Project Heat Seeker” – our internal scan that flags stocks with strong fundamentals (growing earnings, revenue, and profit margins) as they hit fresh one-month highs – has been packed with healthcare stocks lately. As of Friday’s close, there were more than 50. 

Many of these companies are using AI to aid research, diagnostics, and drug discovery pursuits. 

AI can help researchers sift through the vast amounts of genetic data that would take human scientists years to analyze – spotting patterns that point to new treatments, earlier diagnoses, and better-targeted drugs. 

And when it comes to trading the genomics theme, it helps to have an edge in your corner – especially one that also harnesses the power of AI.  

Regular readers know I’m talking about Predictive Alpha, our AI-powered forecasting engine.  

Trained on more than 100 billion market data points, it takes any stock and projects a target price, an expected percentage move, and a target date roughly 21 trading days out – along with how often it’s been right on that specific stock in the past. 

Right now, it’s forecasting gains in three genomics stocks in particular: 

Illumina (ILMN) – makes the gene-sequencing machines that read DNA, the equipment behind most genomics research.  
Predictive Alpha projects a 6.8% move to $188.56 by July 24, with a 77.3% historical accuracy rate. 

Natera (NTRA) – a genetic-testing company focused on cancer detection and prenatal screening.  
 
Predictive Alpha projects a 4.3% move to $273.22 by July 7, with a 76.6% historical accuracy rate. 

Twist Bioscience (TWST) – manufactures synthetic DNA used across drug discovery and research.  
 
Predictive Alpha projects a 15.2% move to $115.01 by July 14, with a 79.7% historical accuracy rate. 

Not every stock in a hot sector is worth owning. Some are genuine innovators. Others are just along for the ride. Predictive Alpha does the sorting – and right now, it’s pointing at these three stocks. 

The White House just put quantum computing and cybersecurity center stage… 

Last Monday, President Trump signed two executive orders aimed at a technology that could one day prove as disruptive as AI: quantum computing. 

Today’s most powerful computers still struggle with certain problems – drug discovery, code-breaking, and financial modeling – that would take them thousands of years to solve. Quantum computers are designed to crack those same problems in minutes. 

The first executive order launches a national push to build a working quantum computer – funding the research, setting priorities, and making sure the U.S. stays ahead of China in the race to get there. Trump signed it alongside executives from IBM and Google. 

The second sets a hard deadline for the government to move its most sensitive data onto “post-quantum” encryption. That’s a new type of security designed to withstand attacks from quantum computers – which could theoretically crack today’s encryption standards with ease. 

And before the president picked up his pen, both themes were showing up in our data. 

Regular readers will know our Short-Term Health indicator. It compares a stock or fund’s recent moves to its normal trading range and flags when momentum shifts – Green for an uptrend, Yellow for caution, Red for a downtrend. 

The Defiance Quantum ETF (QTUM) holds a basket of the companies building quantum computers and the hardware around them. And it entered a Short-Term Health Green Zone on April 21.  

Since then, it’s up more than 22% in just over two months.  

Cybersecurity is also on a fresh uptrend after the first half of the year coasting down. 

Our Short-Term Health turned Red on the First Trust Nasdaq Cybersecurity ETF (CIBR) back on Dec. 1 ahead of a slide of as much as 16%. 

On May 12, it entered a Green Zone. Since then, it’s up close to 16%. 

Both trends are confirmed in our data and now have the White House behind them. 

If you want exposure, QTUM and CIBR are the two great options – and Short-Term Health will tell you if either one starts to roll over. 

If you’re a subscriber, pull both up on the TradeSmith Finance platform and watch the Health status on their top holdings, too. There may be even better opportunities in the individual stocks taking part in both of these major trends.  

To building wealth beyond measure, 

Michael Salvatore 
Editor, TradeSmith Daily 

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