Earnings and Macro Headwinds Trigger a Market Breakdown
The Triple Threat Collided, and a Fourth Has Emerged - Levels for SPX, Indices, Futures, ETFs, Megacaps and Crypto.
It was a volatile and difficult week on Wall Street, as major U.S. indexes finished lower across the board. The market logged its first back-to-back weekly losses since March, primarily dragged down by anxiety over massive corporate spending on artificial intelligence (AI), surging energy costs, and new trade policies.
Key Market Drivers This Week
Big Tech AI Spending Jitters: Q2 earnings sparked investor concern as GOOG dropped -7.8% for the week following raised capital expenditure guidance for AI data centers, while TSLA plummeted -17.8% amid negative free cash flow driven by massive investments in AI and robotics.
Geopolitical Escalation & Energy Volatility: Oil (CL=F) surged over +10.6% reaching $90 following Middle East hostilities and Red Sea tanker attacks.
Rising Treasury Yields: Energy price spikes fueled inflation fears as I highlighted on Wednesday, creating downward pressure on equity valuations ahead of the upcoming Federal Reserve meeting. The U.S. 10-year Treasury yield reached 4.7% and rate hikes are on the table for this second half of the year.
My Weekly Compass last Saturday was titled "Triple Threat" based on three key factors that effectively injected downward pressure on the stock market this week. Now, a fourth factor has emerged, extending the list of hurdles for an already weak price action that we have been tracking:
New Tariff Regime: The U.S. administration introduced a permanent tariff overhaul ranging from 10% to 12.5% on 60 trading partners under Section 301, triggering sharp declines across Asian and global chip-heavy tech indices.
As mentioned recently, these events serve as catalysts for a pullback in overextended charts. The semiconductor euphoria needed a reset, much like we saw in precious metals earlier this year, and in individual names that seemed unbeatable in 2025 such as PLTR, MSFT, META, and NFLX. This is why technical analysis is essential: when prices are overextended, it can flash warning signs for long-term investors who want to avoid 30% drawdowns or even deeper losses. Just look at the current price of those names versus their highs, which is the same story for MU, QCOM, and MRVL despite Jensen Huang's call for "the next trillion-dollar company," alongside many others. This is why this publication works for both traders and long-term investors. From the recent bullish opportunities highlighted recently, AAPL and XOM stand out, both are up 15% this month alone.
Levels as Confirmation Tools
A chart can be overbought printing warning signs studied here for subscribers, and in order to avoid premature decisions (selling too soon or buying too early), the support and resistance levels modeled here in advance for the next week and month set a bullish above / bearish below line that after more than two years of this publication have proven their worth to make more informed decisions.
Today, most of the securities tracked here closed below their central weekly level for next week. More critically, this week the SPX and many other securities lost their central monthly level (CML); as we have studied, monthly levels validate price structures for the longer term. For this week, for example, the SPX and QQQ were considered to set a bullish move to 7,549 and 717 respectively, but they breached their central weekly levels (7,490 -0.4% and 702 -1%) invalidating the thesis and acting in this case as capital protection. The weekly levels also help establish specific targets, as was the case this week for JPM, GLD, IBIT, and ETHA (Bitcoin and Ethereum ETFs), which reached their respective targets of 353 (+3.5%), 382 (+3.7%), 37.3 (+3%), and 14.6 (+5.2%). The favorable risk-reward ratio that comes with applying disciplined level management is clear.
These levels are modeled every Friday for you, providing the information needed to assess risk and reward before the market opens on Monday. You don’t have to wait for the opening bell to decide your plan and which securities to trade; you have here the distances to essential levels and the setups suggesting whether they will act as support or resistance well in advance, so you make informed and serene decisions ahead of Monday morning.
Our Core Watchlist:
Indices & Futures: SPX, NDX, DJI, IWM, ES=F, NQ=F
ETFs: SPY, QQQ, SMH, TLT, GLD, SLV, DIA, VXX
Major Stocks: AAPL, MSFT, GOOG, AMZN, NVDA, META, TSLA, BRK.B, LLY, WMT, AVGO, COST, JPM, XOM, PLTR, NFLX, V, AMD
Crypto & Related: Bitcoin, Ethereum, ETHA, IBIT
Leveraged ETFs: TQQQ, SQQQ, UDOW, SDOW, UPRO, SPXS, URTY, SRTY
Unlock this valuable tool by upgrading your subscription to the paid plan, paid subscribers receive three core weekly publications (Friday, Saturday, Wednesday), plus daily updates for the SPX and its daily levels. Next week is packed with earnings I will also track daily MSFT, META, QCOM, AAPL, AMZN, KO, V, and XOM.
Let’s begin,
WEEKLY LEVELS
As the analysis below highlights, the SPX, NDX, DJI, ES, and NQ futures are all in negative territory along with their corresponding ETFs (SPY, QQQ, DIA), alongside IWM and SMH. The percentages highlighted in red indicate the moves needed to recover bullish momentum. Interestingly, a few tech stocks and non-tech mega-caps remain in the green: