AAOI, LITE, and Coherent Are Up 21-53% in a Week — Are You Still Sleeping on Photonics?

While the internet was busy debating whether $NVDA gets a China deal (spoiler from Bloomberg: Jensen Huang went to Beijing and came back with basically a tote bag), the actual AI buildout trade was happening in photonics and optical interconnects. $AAOI, $LITE (Lumentum), and $COHR (Coherent) posted gains of 21-53% last week alone, bouncing hard off their 9/21 EMAs according to The Traveling Trader — who also just closed a 160% gain on MRAM after its market cap went from $400M to over $1B in a week.

The thesis is simple and kind of beautiful: NVIDIA needs chips, chips need data centers, data centers need insane amounts of optical fiber and photonic switching to actually move that data around. Meanwhile, $NVDA is sitting on a China-shaped hole in its revenue model, down 5%+ Friday in a broad tech selloff that Bloomberg called a "post-melt-up breather" rather than a structural crack. Also on the radar: $NBIS (Nebius) is in the same AI infrastructure conversation, with momentum traders watching it closely.

The Traveling Trader also flags a potential software rotation coming — meaning the hardware euphoria might have a timer on it. But for now, the pipes that carry AI are outrunning the AI chips themselves, which is either a great trade or the most on-brand thing 2025 has ever done.