SOXX (Semiconductor ETF) bounced from horizontal support around 533. Despite the recent drawdowns, the sector remains overextended on the larger timeframe.
Bulls need to hold 533 to keep the rebound alive; a break below would put the correction back in control.
601899 (Zijin) broke below its major trendline support and is now backtesting that trendline from below. Bulls need to reclaim it quickly to repair the structure. A failure to reclaim would confirm the breakdown and signal further weakness.
XLF (U.S. Financials ETF) is rallying ahead of an anticipated hawkish Fed and a higher-for-longer rate environment. That is not a good sign for long-duration assets.
GDX (Gold Miners ETF) broke below its major trendline support this week, then bounced back to retest the level from below.
Bulls need to reclaim both the trendline and the 79 area quickly. If this retest fails, the breakdown stays valid and we could see GDX much lower. The structure still does not bode well for gold.
PLTR (Palantir) is sitting right on 128 support. This is the line in the sand for AI software.
A breach here will not be pretty, for PLTR or for the AI application names. Below 128, the next real support sits around 101, and that would turn this into a much deeper breakdown.
For bulls, there is no mystery. Defend 128, then reclaim the downtrend line. Until that happens, every bounce is just a backtest inside a weakening structure.
MAGS (Magnificent 7) headed lower and found support around 63, as expected. The recent relative weakness of MAGS versus NDX is concerning.
Almost all Mag 7 names are running negative free cash flow, and AI capex funding is increasingly coming through secondary offerings rather than the traditional channels we are used to seeing. That usually means those channels are no longer providing enough capital on acceptable terms.
For now, 63 is the level to watch. If MAGS fails to hold here, the structure weakens further and opens the door back to 60.
XAUUSD Gold broke the key 4.4K support, and we warned that further weakness was imminent.
We also warned bulls not to catch the falling knife from that level.
That was the right call.
Gold was dumped another $300/oz at one point, only to recoup most of the move after a timely headline.
Now gold is sitting right at its major trendline, so the next few sessions are critical.
A clean break below this trendline would put 3.9K back in play.
On the upside, bulls need to reclaim 4.4K.
VIX Volatility should explode exponentially if VIX (Cboe Volatility Index) breaks above 22 in the coming sessions.
DXY The dollar jumped on rate-hike expectations on Friday. Next stop is 100.2, followed by 101. Above that, the door opens to repricing across all asset classes.
XAGUSD Silver technicals had been weaker than gold's since early February.
As gold broke below key support, silver also broke below its major trendline support on Friday.
I expect further weakness from here.
NQ1!
SPX reversed from the trendline resistance we identified last week as rate-hike expectations picked up, semi earnings ended with a sell-the-news reaction, the market front-ran the next FOMC, and SpaceX joins NDX next week.
Despite the sheer size of yesterday’s drop, I expect this is only the beginning of a much larger correction. My view has not changed: AI is a bubble, it is only a matter of time before it pops, and the oil supply shock will pull the macro backdrop back toward the 1980s.
I have been warning that as price goes vertical, stops must be tightened. Many members of this community are based in Asia, and price action like yesterday’s can wipe out accounts overnight if risk is not managed properly.
Next stop is 7337, followed by my swing target of 7.1K. After that, we either see a steeper drawdown or a violent move higher for the final euphoria. Based on the technicals, I favor the first.
This feels like late March 2000. If you look at the SOX chart, it closely resembles the dot-com terminal rally that ended the tech bull market.
If this analogy is right, NDX could plunge 15-20% within the next 5-10 trading days. Back in spring 2000, SPX was relatively more stable during that move. We are seeing too many similar signals to ignore.
Next support sits around 28.6K, followed by 26K.
Z1! (FTSE 100) must reclaim 10.4K to see more upside. If it fails to do so, the structure remains vulnerable and risks heading lower.
CL1! Oil bounced from trendline support around 87, but it remains contained as inventories are drained at a record pace to offset the ongoing supply shock. The administration keeps pushing fake-news headlines to create enough hopium for the market to digest.
The triangle should resolve by mid-July at the latest. A clean close above triangle resistance would trigger a violent bullish breakout and push inflation beyond the 2020-2021 episode. A clean close below triangle support would open the door to a test of the low 80s.
As mentioned repeatedly, regardless of headlines from either side, as long as oil remains above 80, it suggests no real progress has been made on a peace deal.
BZ1! For BZ (Brent futures), a break below 86 would suggest real progress toward a peace deal, while a break above 100 would reignite inflation fears.
HG1! Copper is struggling to break above the upper channel. I would not chase unless it confirms the strength with a sustained breakout.
Fundamentals remain strong, but price still needs to prove it.
NKD1! If NIKKEI (Nikkei 225) fails to hold 63.8K support, it risks testing the low 60K area in the coming days. Bulls need to defend this level to keep the structure intact.
HTI1! (Hang Seng TECH Index Futures) had a failed attempt to break out to the upside. The move was quickly reversed, and the index is now testing the key 4.74K support that has held it afloat for the past few months.
A decisive break below 4.74K opens the door to a test of 4.2K.
