Vanished Rally As Expected
From premarket gains to a negative close, market character is risk-off, with semiconductors taking a notable hit.
As noted in Saturday’s chat update for the QQQ chart, tech remains locked in a bearish channel, leaving any rally on Monday with low probability to be sustained for the SPX, NDX, SPY, and QQQ.
True to my weekend outlook, both GOOG printed a gap-fill attempt today bouncing +2.3%, while TSLA overextended its daily technical conditions, keeping the thesis for an imminent squeeze fully intact. However, the standout move of the session was a sell-off in semiconductors. Both SMH and AMD cleanly sliced during market hours through the bearish targets outlined in the Weekly Compass, closing down -2.3% and -5.2% respectively 🎯.
We also saw an intriguing divergence within tech today. Instead of the usual split between the Magnificent Seven and semiconductors, the divergence occurred between hardware and software. The software ETF (IGV) rallied 3.3%, alongside strong gains in tracked names like MSFT (+1.9%), PLTR (+7%), NOW (+7%), ORCL (+4.3%), and APP (+5.3%).
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The latest S/R levels for this week and the Weekly Compass are below:
Looking ahead to tomorrow’s game plan, below I map out daily levels for the SPX, accompanied by a breakdown of the mega-caps reporting earnings this week, including META, MSFT, AMZN, AAPL, XOM, V, QCOM, and KO. SPCX also included, it printed a third consecutive indecisive daily candle today as it edges closer to the earnings report.
Let’s begin