2/23/26 Recap
The SPY is right back down to the 100 day, we’re knocking on that door for the 4 time in a couple weeks and once that floodgate opens with a close below there, you’re now looking at the 200 day way lower at just over 650 as the next support. The VIX is also up 10% to 21 today throwing off all your options. The AI disruption trade is taking another leg forward after the viral piece from Citrini yesterday. So many names like American Express, Wynn or Ralph Lauren down 7% each where you would see destruction in a scenario where white collar jobs are eliminated en masse. The fact that even casinos were slammed today was funny as you’re not exactly going to vibe code those away anytime soon. Call me a skeptic, but I think ai will be useful but not an extinction level event for white collar jobs anytime soon. Simply, we’ve been in a downtrend for 3 weeks now in tech stocks, his piece striking fear in some more institutional investors didn’t help anything, but it also didn’t exactly change much, it just exacerbated the selling we’ve been seeing.
The QQQ remains our biggest problem and this is just a bear flag don’t overcomplicate things. Every attempt to reclaim the 21 ema so far has failed. Can this resolve higher? Sure, but likely, it won’t and we will breakdown and probably head for that 200 day. Barring some blowout surprise from NVDA I just don’t see what could stop this right now, we’re on day 14 closing under the 21 ema here today, that’s 3 weeks, that is as simple of a downtrend as there could be and that’s why I bought those put spreads I did last week to hedge. I usually wait to see us recover the moving averages quickly, and we didn’t here, that is when issues begin to really arise.
Speaking of the bear flag on the QQQ take a look at the IGV below. That is software, notice anything similar to the chart above? A flag formed at lows and eventually it broke lower this morning. That is why you have to respect these patterns.
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