US Stock market news - Wall Street selloff
In today’s video we focused on the U. S. stock markets and, in particular, Nvidia and the tech Stocks.
There was a lot of interesting market action today.
Gold and Silver prices charts
One of the most interesting behaviors was the fact that as the Stock markets sold off, Gold actually rose. The yellow metal was weak in the morning but as the day wore on Gold found support and headed gently higher.
This strong action in Gold is bullish for the Precious metals. The price action doesn't look very bullish on the chart, but relative to what the Stock markets did today, that's fine action in gold.
Silver doesn’t look as good as Gold, but it did find support along the median line of a Schiff pitchfork and then moved a little higher.
Nasdaq 100 chart
Instead of following through on Thursday and Friday’s bullish action, the Nasdaq index rolled over today and moved 3.15% lower.
In the video we drew attention once again to an open gap above the current price action. This unfilled gap is a sign of weakness in the technology sector, or at least in the Nasdaq 100 Stocks.
In the final hour of trading the index found support at a support resistance zone and bounced a little bit higher.
Other bearish aspects of the Nasdaq chart include rising volume as price declines and a new sell signal from the MACD indicator.
There are more details in the video.
S&P 500 chart and Dow Jones chart today
The S&P 500 index lost 2.12% today and bounced slightly off the 50-day moving average. Volume increased on the selloff which, again, is bearish.
The Dow index lost 1.51% to find support along a minor support resistance level. Based on the MACD indicator, DJIA is very overbought and it appears that upward momentum has ended.
Dot Com bubble vs AI bubble
Technology Select Sector SPDR Fund (NYSE Arca: XLK) vs S&P 500 index
One of the most interesting charts shown in today’s video compares the strength of the technology sector (as represented by XLK) to the strength of the overall S&P 500 index.
The chart covers the time span of the late-1990s to today and emphasizes the similarities of the Dot Com bubble of 1999/2000 to the current bubble in technology Stocks which some analysts are calling the AI bubble.
In addition to the similarities in price action between 1999/2000 and today, we pointed out how the narratives in play during each period are very similar.
During the Dot Com bubble the narrative was, “the internet will change everything.” Today, the narrative is, “AI will change everything.”
Demonstrated very clearly in the chart is how the Dot Com bubble reached a certain level before popping, and that today, the AI bubble is very close to the same level.
Nvidia stock chart
Nvidia Corp. (Nasdaq: NVDA)
Nvidia stock is obviously the key player in the group of AI technology stocks.
In the video we talk about an Energy Coin in the Nvidia price chart. Energy Coils are one of the Technical analysis techniques that Dr. Timothy Morge taught during his seminars on Andrews Pitchforks.
One of the key behaviors of an Energy Coil is that when price exits the Coil it will do so impulsively (i.e., with high energy). This makes sense when we think about an Energy Coil as a consolidation pattern where the Stock is gathering energy for its next move.
While we were expecting Nvidia to exit the Energy Coil and head higher, the exact opposite happened. Nvidia exited the Coil and headed lower. And, just as Dr. Morge taught, Nvidia moved out of the Coil impulsively.
There is a second Technical analysis technique demonstrated in the video. Dr. Morge called it, “Double the Range.”
When price moves in a price channel, we can think of that channel as a range. If we are trading the Stock we can take advantage of the channel and apply our range trading techniques.
In the video we apply the Double the Range technique to the Nvidia price chart and show how this methodology accurately identified a price target.
Nvidia stock forecast
After Nvidia’s impulsive move downward, it is logical to look for support levels where the Stock may bounce.
In the video we apply the Fibonacci retracement tool to identify a potential support level. This tool gave us a potential price target and we identified a secondary price target if the first one fails.
Nvidia subpoena from DOJ
After the Stock markets closed, the Department of Justice issued a subpoena to NVIDIA and other companies.
The subpoena indicates that the DOJ is investigating Nvidia for potential violations of antitrust laws.
Based on the price action in Nvidia during today’s session, it appears likely that insiders knew about the upcoming subpoena. We discuss this possibility in the video.
We also discuss the possibility that investors in AI technology got ahead of themselves and are now stepping back to reconsider their commitments to AI and the related stocks.
UnitedHealth Group stock
UnitedHealth Group Inc. (NYSE: UNH)
UNH is the number one stock in the Dow 30 based on weighting. This Stock is a heavy-hitter which makes up 9.38% of the Dow index.
The stock made a bullish move today, poking up through resistance and closing there.
Consumer Staples ETF
Consumer Staples Select Sector SPDR Fund (NYSE Arca: XLP)
During our research today we looked at each of the SPDR ETFs that correspond with the main sectors in the S&P 500 index.
We noticed that XLP, the consumer staples ETF, is making new all-time highs which suggests that investors could be moving into more defensive areas of the Stock market.
This shift to risk-off assets is supported by the bullishness in UNH which is why we shared both of these charts in the video.
Magnificent Seven ETF
Roundhill Magnificent Seven ETF (Nasdaq: MAGS)
We looked at this ETF because it gives us a quick way to look at the overall health of the Magnificent Seven stocks.
And, of course, the Mag 7 and the AI stocks are essentially the same. If we add Google (Nasdaq: GOOG) to the Mag 7, we have all of the major stocks in the AI technology group.
In the video we show that the Magnificent Seven ETF (and therefore the AI stocks) have formed what could be an Island Top pattern which is considered a reliable reversal pattern.
Visa stock price
Visa, Inc. (NYSE: V)
In the Visa price chart we show that the stock has formed a double triple top. You’ll have to watch the video to see what that means.
Caterpillar stock price
Caterpillar, Inc. (NYSE: CAT)
We looked at CAT in the last video analyzing the top 10 Dow index components.
In today’s video we show the Caterpillar price chart again to demonstrate another advanced Technical analysis technique that Dr. Morge taught.
Watch the video to learn about Price Magnets and how they influence price action in a stock.
Goldman Sachs stock price
Goldman Sachs Group, Inc. (NYSE: GS)
GS is another stock we looked at in the previous video. It counts for 8.04% of the Dow index so its behavior influences the entire Dow 30 index.
In today’s video we take another look at the Goldman Sachs price chart because the price action today confirms the triple top pattern that we previously identified.
Wrapup
In the wrapup of today’s video we encouraged investors to think about everything that is going on in the world and how that might affect the Stock markets.
Volatility due to geopolitical events, volatility due to elections, volatility due to events in the tech sector, etc. There are a lot of significant events happening right now and any one of them could have a major impact on an Investment Portfolio.
As a final point, we emphasized that the technology stocks have been the main driver in recent Stock market strength and that we may be seeing that strength end.
There are a lot more details in the video – give it a watch for an in-depth look at the US Stock market today, and don’t forget to like and subscribe!
https://satoritraders.com/blog/us-stock-market-news-wall-street-selloff
