Welcome back, everyone.
This will be quick and straight to the point, focusing exclusively on the S&P levels.
S&P Levels
The main levels to watch today will be the 6889 high-volume node (HVN) and the 6932 point of control (POC). On the downside, we want to see sellers take the price back below the 6889 HVN for a continuation of selling into next week. If we see a close between 6889 and 6808 on the week, then we could very well break into the 6700s next week.
This downside move would also align with the Nasdaq closing below its 21-week EMA. Closing below that moving average will cause major problems for tech next week. We have yet to see really strong selling in tech, other than in software for the most part. My reasoning for this is that funds are getting pulled from software and put into broader tech as a safer option. Software stocks were initially used as a way to take a piece of the AI pie, but problems arose when these companies weren’t able to generate revenue close to their previous projections. Money is now flowing out of these companies and into the ones that will be clear winners. However, even the mega-cap tech companies have yet to show any robust returns on AI, and I think we could soon see some sort of unraveling in the near term for these stocks. This unraveling will be confirmed by a weekly close below the 21-week EMA on the QQQ.
Getting back to the S&P, for the upside, we will watch for a break over 6895 to trigger a sharp spike up to the 6932 POC. Because of the large volume concentrated there, it is a very attractive target and could lead to choppy price action heading into the close.
Daily Scenarios
Scenario A: If the price is able to break and hold below 6889, I expect a sharp sell-off down to 6833.
Scenario B: Upon price opening strong and breaking above 6895, a continuation up to the 6932 POC is likely.
That is all from me. Have a great rest of your week.
Disclaimer
General Risk Disclosure: Trading in the stock market involves substantial risk and is not suitable for every investor. The valuation of stocks may fluctuate, and as a result, clients may lose more than their original investment. The impact of seasonal and geopolitical events is already factored into market prices. The highly leveraged nature of stock trading means that small market movements will have a proportionally larger impact on your traded funds, and this can work against you as well as for you.
No Guarantee of Accuracy: The information provided in this newsletter is obtained from sources believed to be reliable and accurate; however, Flint Research does not guarantee its accuracy or completeness. The views, opinions, and analyses expressed herein are provided as general market commentary and do not constitute investment advice.
No Investment Recommendations or Professional Advice: Flint Research is not a registered investment advisor or broker-dealer. The content provided in this newsletter is for informational purposes only and should not be construed as investment advice. It does not constitute an offer or solicitation to buy or sell any securities or to adopt any investment strategy. Any decisions made based upon the information provided in this newsletter are the sole responsibility of the reader. We recommend that you seek advice from a qualified professional advisor before making any investment decisions.
Past Performance Not Indicative of Future Results: Past performance of a security or market is not necessarily indicative of future trends. Historical data should not be relied upon as a prediction of future market movements.
Regulatory Compliance: Flint Research complies with all applicable laws and regulations, including those set forth by the U.S. Securities and Exchange Commission (SEC). We are committed to maintaining the highest standards of integrity and professionalism in our relationship with you, our client.
Conflicts of Interest: Flint Research and its staff may hold positions in the securities mentioned in this newsletter. These positions can change at any time.
Use of the Newsletter: The information provided in this newsletter is intended solely for the personal, non-commercial use of its subscribers. Redistribution of this newsletter in any form is prohibited without the express written consent of Flint Research.