Marc Chaikin isn't exactly the type of guy to sit quietly when he sees a freight train coming. If you've followed him for any length of time, you know the vibe: he’s the Wall Street veteran who spent decades building the tools the "big boys" use, and now he spends his days trying to keep regular folks from getting steamrolled. Right now, he's looking at the AI craze with a mix of excitement and massive caution.
He's worried.
The hype is everywhere. But here is the thing: a Marc Chaikin AI stock pick isn't just a random "buy Nvidia" shout-out. In fact, as we kick off 2026, he’s actually warning that the "Mega Melt-Up" we’ve seen in tech is reaching a dangerous tipping point. He’s not saying AI is a scam—far from it. He thinks it’s the most transformative tech since the internet. But he also knows that when everyone starts piling into the same five stocks at once, the exits get very small, very fast.
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Why the Power Gauge Is Screaming Caution
Most people looking for a hot tip want a ticker symbol they can ride to the moon. Chaikin doesn't work like that. He uses something called the Power Gauge, which is basically a 20-factor "lie detector" for stocks. It looks at things like Chaikin Money Flow—to see if the smart money is actually buying—and earnings consistency.
Right now, the system is throwing some serious shade at the big names.
Take Tesla, for example. While the headlines are obsessed with Elon Musk's latest move, the Power Gauge recently slapped a "neutral" rating on the stock. Why? Because the financials and earnings categories are looking, frankly, pretty ugly (or "very bearish" in Chaikin-speak). Even if the "experts" and technicals look good, the underlying math doesn't always support the price.
The Shift to "Hidden" AI Opportunities
If the big tech giants are getting top-heavy, where is Chaikin actually looking? He’s pivoting toward what he calls "Hidden AI" plays.
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These aren't the companies making the chips. They’re the companies using the chips to actually make money. Honestly, it’s a smarter way to play the boom without the 90% drawdown risk that usually follows a tech bubble.
- Software Productivity: Chaikin has been consistently bullish on companies like ServiceNow (NOW) and Synopsys (SNPS). These aren't just "AI companies"; they are businesses that have integrated AI to make their existing software indispensable.
- Infrastructure & Chips (The "Secondary" Layer): While everyone is chasing the Nvidia dragon, Chaikin has pointed toward Advanced Micro Devices (AMD) as a preferred semi-conductor pick. He also looks at the plumbing of the internet, like Arista Networks (ANET).
- Specialty Tech: This is where it gets interesting. He’s mentioned Procore Technologies (PCOR)—which uses AI for construction—and Pure Storage (PSTG), which has a tight partnership with Nvidia for data storage.
The 2026 Bear Market Warning
You can’t talk about a Marc Chaikin AI stock pick without talking about his 2026 forecast. He’s been on the record saying there's a 65% chance of a bear market this year.
That’s a heavy number.
He points to three main "red flags" that usually signal a crash:
- A transformative tech (AI) causing a melt-up.
- Easy market access for millions of new, often emotional, investors.
- Record-high consumer credit balances.
Basically, the engine is running too hot. Chaikin recently teamed up with Keith Kaplan from TradeSmith to launch a "Flash Portfolio." The goal isn't to buy and hold forever. It’s to own the five best stocks each month and get the heck out the moment the signals turn red.
They’re using something called "Flash signals" because traditional stop-losses are too slow for today's market. If an AI stock pick drops 20% in a week, a trailing stop is basically just a record of how much money you lost. Chaikin wants to see the "abnormal weakness" before the floor falls out.
Don't Ignore the "DOGE" Factor
One of the weirder, more specific things Chaikin and his team (specifically Joel Litman) are watching in early 2026 is the "DOGE Phase II" rollout. No, not the coin—the government efficiency project led by Musk. They believe this shift toward automation and radical cost-cutting in the U.S. government is going to force a massive sector rotation.
The companies that help the government automate—those "AI users"—could be the surprise winners while the "AI dreamers" get crushed.
How to Handle Your AI Picks Right Now
So, what should you actually do? If you’re holding a bunch of AI-related stocks, Chaikin’s advice is usually pretty simple, even if it’s hard to follow:
Check the "Smart Money" Flow
If the stock price is going up but the Chaikin Money Flow is turning red (moving from the top of the chart to the bottom), that is a massive warning sign. It means the big institutions are selling their shares to retail investors who are buying the hype. You don't want to be the one holding the bag.
Diversification Isn't What You Think
If you own an S&P 500 index fund, you aren't as diversified as you think. Because that index is weighted by market cap, it’s basically just a giant AI and tech fund at this point. If tech tanks, the "safe" index fund goes with it. Chaikin suggests looking at industrials, financials, and even energy companies that are using AI to become more efficient.
The "Flash" Strategy
In a volatile year like 2026, the "buy and hold" mantra might be dangerous. Chaikin is leaning heavily into a monthly rotation strategy. If a stock isn't rated "Bullish" or "Very Bullish" on the Power Gauge, it doesn't belong in the portfolio. Period. No exceptions for "but I like the CEO" or "the product is cool."
Actionable Steps for the 2026 Market
If you want to follow the Chaikin approach, stop looking for "the one" stock that will make you a millionaire overnight. That's how people get hurt. Instead:
- Audit your current tech holdings: Run them through a factor-based model. If the earnings consistency is low and the P/E ratio is astronomical, ask yourself if you're okay with a 30% drop.
- Watch the "Tipping Point": Keep an eye on the seasonality of the market. Midterm election years (like 2026) are historically the most volatile.
- Pivot to "Productivity" AI: Look for the companies that are actually showing higher margins because of AI, not just the ones mentioning "AI" 50 times in an earnings call.
The market is healthy for now, but the "smart money" is already moving toward the exits or shifting into defensive AI plays. Following a Marc Chaikin AI stock pick means being willing to sell just as fast as you bought. It's about protecting what you've made so you're still in the game when the inevitable bottom happens in late 2026.
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Start by reviewing your largest positions and checking if they still have the "institutional support" that Chaikin considers the lifeblood of a rising stock. If that money starts to dry up, it’s time to move on to the next opportunity.