SPX and NDX Structures Broken - Semiconductors Crack
Assessing the bearish momentum and mapping out the essential prices needed for a validated recovery next week. Bearish targets mapped.
On Monday, the S&P 500 fell 0.4%, breaching the central weekly level (CWL) of 7,493.7, as anticipated in Saturday’s Weekly Compass in the high probability setups. The SPX exhibited several underlying cracks in its price action, despite the 1.1% rally observed on June 18th before the long weekend.
Once our modeled central weekly level was breached, validating my bearish thesis, Tuesday saw steeper declines as South Korea’s KOSPI crashed 9.9%. This marked its sharpest fall in over three months and sparked a global semiconductor selloff (consistent with overheated conditions we have studied). As a result, the NDX tumbled 3.2%, and the S&P 500 retreated 1.44%. By the end of the week, the SPX reached my extended bearish target of 7,318.4, completing a 2.4% drop 🎯.
Other high-probability setups also played out with precision:
AMD: Reached its bearish target of $510, completing a -5% move 🎯.
SMH: Exceeded my bearish target of a 4.6% drop, closing the week -7% 🎯.
MSFT: Hit $356 in a clean bearish move of -6.1% 🎯.
GLD: Highlighted as a bearish setup, it reached $364.3 for a -5.8% decline 🎯.
The modeled S/R levels also set a risk management level, a price line that if breached invalidates the directional thesis, for this week DIA and JPM did not fall as expected, but their stop loss references were clearly included in the setups Blueprint at $517.4, and $327.4 respectively, for an average -0.5% from Friday’s close.
That means:
Average gain of the high probability setups: +5.3% gains
Average loss for invalidated setups: -0.5%
(For those new to the stock market, short selling allows both traders and investors to profit when prices fall)
Unlock the S/R levels for next week presented below by upgrading to the paid plan.
As a perk, I’m posting daily levels for SPX for all paid subscribers, do not miss out, they work as early reversal signals when the central daily level (CDL) is breached.
My approach is rooted in technical indicators transparently presented to subscribers every Saturday, and these setups utilize specific, modeled price levels for the week ahead.
I model these levels every Friday to provide you with the information necessary to assess risk and reward before the market opens on Monday. You do not have to wait for the opening bell to formulate your trading plan. You are provided with the exact distances to essential levels and the setups indicating whether they will act as support or resistance well in advance, empowering you to make informed, calm decisions before Monday morning.
Many traders make decisions before 8:00 PM Eastern Time on Fridays, when extended hours close across major brokerage platforms, another reason to post this every Friday around 6PM NY Time.
The levels are calculated for all securities on my watchlist, focusing strictly on mega-caps and high-volume ETFs. This ensures your orders are filled efficiently and that leveraged instruments remain readily available for your trading strategies:
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
The monthly levels section explains why the Structure is damaged.
Let’s begin.
WEEKLY LEVELS
The column highlighted with red markers presents the current distance to next week’s central weekly level (CWL). For example, AVGO must rally 4.4% before any potential upside can be considered technically valid. As you can see, there is red across the board. Regarding JPM and DIA, the current setup has simply delayed the broader move. In last night’s daily note, we reviewed the technical conditions for the Dow Jones, and those conditions are amplified in the financial sector. XOM is also suggesting a delayed move.
Keep the levels for the futures also included in mind, given the overnight price action: