Oil prices surged as tensions escalated in the Middle East. Brent crude touched $91 gaining +2.9% as USO +2.9%, fueling investor concerns that elevated energy costs could exacerbate inflation and provoke additional interest rate hikes from the Federal Reserve. The VIX jumped 6.6%, the SPX lost its central weekly level (CWL) as considered last Saturday in the Weekly Compass where I studied the macro context before all the deep dive on technical analysis. The publication is still valid, get access here:
Despite the broader market decline, chipmakers outperformed. Surging Q2 revenue reports from Anthropic signaled robust artificial intelligence spending, lifting shares of Micron Technology MU over 4% and SNDK up nearly 9%.
Who is Telling the truth?
The SPX and the Dow Jones have technical conditions analyzed during the weekend that suggested a pullback, the VIX on the other hand was nearing to a support zone, and semiconductors presented constructive setups, in fact, SMH was highlighted as a high probability setup aiming at $600.8 (+2.2%) as the primary target, $600 was reached today.
There is an important aspect to consider in the Semiconductors move that will be described below in the daily plan for Tuesday, Aug 18th.
Get the daily levels for SPX, ES=F, SMH, NVDA, MU, AMD, TSM, AVGO, and SPCX (among others, and it continues gaining momentum as the technical setup suggests).