The SPY gapped down under the 50 day and has since recovered, we haven’t closed below there since September 16th. Now we have the 100 day as support right below 760. The numbers from Anthropic yesterday were not enough to satisfy investors and the Kospi got slammed overnight with Korea’s market down over 7.5%. These are some crazy moves coming out of Korea, if the Nasdaq was down 7.5% on a random Thursday people would lose their minds. The Kospi is down 17% in the last month while the Nasdaq is up 2% but that Kospi move is decimating the ai names. NVDA,AMD, INTC are all down huge today look at names like Samsung down 10%! We have some major question marks in the ai trade for the umpteenth time and I’m sure we’ll hear soon that someone big blew up again between yesterday and today. Now bulls need a quick move up before these moving averages begin to slope down and really cause issues. Other than that, oil is up over 96 now and the vix is at 17.50 both are not ideal for equity bulls.
Look we’re in a market where narratives are changing daily regarding our biggest trade, ai. This volatility is just chaotic. If you’ve had a great year, dialing back your risk or stepping aside for a few weeks and watching what happens unfold isn’t the worst idea. We have more chaos in the Middle East with Yemen bombing Saudi Arabia daily, we have Russia and Ukraine seemingly ramping their war to levels they hadn’t in 4 years, and now it appears we have a fairly high likelihood of the US going back to war with Iran once midterms pass as they keep sinking ships in Hormuz. Those 3 events alone are going to have serious implications for the oil market and negatively for equities if they ramp from here and again, odds favor that. The one thing markets hate is uncertainty so now until these questions clear up, you’re just going to have weakness. There’s obviously always something to trade but most people are in these ai names and right now just doesn’t look like the time for them unless your time horizon is months.
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