The situation in Iran is deteriorating, oil prices continue to climb, and the stock market remains locked in a persistent selloff. However, it is essential to have in mind that market crashes rarely move in a straight line.
History shows that even during the most iconic collapses, such as the Dot-com bubble, the Great Financial Crisis, or the bear markets of 2018 and 2022, the decline was a process. These periods lasted for weeks or months and were characterized by sharp, intermediate relief rallies that occurred before the selling resumed. Even the 2025 Tariff Crash followed this pattern, with historic single-day surges providing temporary breathing room amidst the volatility.
In recent history, only the COVID-19 crash of 2020 moved with such velocity that it bottomed in roughly four weeks before a V-shaped recovery began. Aside from that unique event (which was more severe than the current energy-driven shock) major selloffs typically involve a cycle of reaching deep oversold conditions, followed by significant relief bounces as the stock market breathes.
As posted yesterday, the support and resistance levels frame a -1.6% to +3% move for next week in the SPX, considering the first layers around the central weekly price level.
The VIX has closed above 25 during four consecutive weeks in a row, that condition favors bears, but as we have seen during the same weeks, volatility also brings quick rallies that may squeeze short positions if risk is not managed well. For that reason I’m posting in the paid subscribers chat daily price levels for the SPX, the main ETFs like SPY, QQQ, SMH, VXX, and DIA, along with all the magnificent seven, metals, and other major stocks. If you trade using levels, those daily insights are for you.
High Probability Trades
Last week, the setups blueprint anticipated with prudence bullish reversals for PLTR, JPM, NFLX, AAPL, SMH, and AMD. All of them happened reaching and exceeding their bullish targets; and as the VIX above 25 suggests, volatility followed with a selloff. The bearish setups highlighted last week for META and AMZN also exceeded their targets. The only security that didn’t move as expected was XOM, which despite of overbought conditions, it continued in rally mode. 8 out of 9 setups reached their targets.
Having specific support and resistances for the week help anticipating potential reversal areas. Upgrade your subscription to paid and get the tools for next week.
My last two publications have real life examples of managing stop losses, which is essential for survival in this market.
Today’s analysis brings a zoom in to previous bottoms for the S&P 500 / SPX.
This publication constantly studies the following securities in order to monitor rotations with the momentum map and individual analyses. If you trade some of them, this publication is for you:
Indices & Futures: SPX, NDX, DJI, IWM, ES=F, NQ=F
ETFs: SPY, QQQ, SMH, TLT, GLD, SLV, DIA, VXX
Megacaps: 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
Subscribe and unlock their setups for next week in a single dashboard that highlights the most probable moves for next week.
Today’s Agenda:
Special Study of Bottoms for the SPX: Major bottom? or just relief rally?
The Momentum Map: Analyzing the stage of every security in a single chart.
Market Context: Technical charts and price levels for U.S. Indices, Volatility, Breadth, and Crypto.
Setups Blueprint: Entry levels for short and long setups with price targets and invalidation levels for all the securities in the watchlist prioritizing stronger setups.
Deep Dive: Visual individual analysis of Metals and Mega Caps.
Let’s begin,
SPX: What the Last Four Bear Markets Suggest is Coming Next