7/17/26 Recap

The SPY gapped down under the 50 day this morning giving us a real warning sign. This is our 2nd move under the 50 day in the past month and while we’re clawing back the move so far, a close under 744.41 today would not be ideal.

China basically fired missiles at us yesterday with the Kimi news. It’s not a secret that we’ve been at war with China for decades and now they have thrown a wrench in our ai leadership, potentially. I personally don’t see it as that, everyone panicked when Deepseek came out and as we usually come to find out, the threat is nowhere near what the panic would have you believe. We know they distill our models and if anything this is going to force Trump to ramp the investments, restrictions, etc because we cannot let China win the ai war. So while everyone is focused on does this mean capex can be cut with China allegedly spending so much less, I think the opposite happens and we will need to ramp our efforts. If you’re on the fence about short term positions say less than 3 months to go, you would not want to be long a close under the 50 day. Will we be fine by say November, probably, but this is a 3rd lower high and that is not a good technical look. Megacap earnings to begin next week and alot can change with that. For now, until we get more clarity, the panic is unfolding. It’s hard to say this wasn’t visible in charts when the SMH was under the 50 day and breaking down hard the last few sessions. As you can see below it is nearing that 100 day moving average and needs to hold there or this can get materially uglier.

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