9/2/25 Recap

The SPY is breaking down again. This is the second loss of the 21 ema since the April lows, the last one in early August lasted just 1 session, this one feels different. I don’t think this will be an instant recovery. The next level to watch is the 50 day just over 630 and if that is lost, it opens the door to much lower levels like the 100 day just over 600. Semis are all looking bad right now, NVDA is losing the 50 day and that is 8% of the market, also MSFT and META lost the 50 day so you’re talking almost 20% of the market is technically very weak right now. This isn’t time to be a hero, do not put on tech longs here if the short term matters to you. If your timeframe is a year or more, do as you please but the market is sending you huge warning signs below the 21 ema and it isn’t time to go risk on. As we’ve discussed before, you might miss a big bounce by being cautious here, but you’ll never be part of a big move down by being prudent. On the long side, you really don’t want to go long again until you see that 21 ema reclaimed, that is about it. Respect the price action, it is telling you something isn’t right at the moment and you don’t always have to be max long. You’ll notice with my book below is I’ve dialed back my leverage dramatically and shifted focus to where I’m seeing strength. There’s always strength somewhere, it doesn’t always have to be the same 10 tech stocks that carry us 90% of the time.

The big one to watch right now is this QQQ that is really the market, the SPY has more diversification but everyone knows our market is mostly tech. The QQQ is losing the 50 day today as you can see below for the first time since this uptrend began in April, that is not good in any way. There is nothing to spin here, money is rotating out of tech and with how everyone is positioned, this can get painful quickly. You most likely do not want to touch any large cap tech until this reclaims that 50 day line.

My Open Book

Trades I Put On Today

1. BABA - I sold another 1000 of the same 115 June 2026 short puts I entered friday this morning at the open. This name was almost 143 in the overnight session but hit 133.xx this morning as our markets sold off. This now puts my biggest trade firmly as a massive credit. While there is always risk with China, the whole de-listing talk doesn’t really scare me as any sort of threat ever to Taiwan would be seen with circling of warships,etc long before things are delisted. If you remember Russia lined up troops on the border for months, then invaded, then their equities were de-listed. So at the moment not a thought of mine.