The market remains in a tech-led correction. Note the contrast between tech centric indexes like the
NASDAQ Composite and the
S&P 500 when compared to the broad non-tech centric
NYSE Composite which actually posted an all-time closing high on Thursday amid continued tech selling. For now, both the
NASDAQ Composite and
S&P 500 remain below 50-dma resistance with the S&P breaking back below the line on Friday on heavy month-end volume. Things will certainly not improve on Monday when trading resumes based on overnight news Friday that the U.S. and Israel had begun a major military action against Iran. Stock futures are gapping lower but precious metals futures are gapping higher at the time of this writing.
Nvidia (NVDA) reported earnings on Wednesday after the close and promptly broke down after rallying back above the $200 Century Mark in the after-hours on Wednesday in an initially bullish reaction to earnings. That did not last long as NVDA quickly dropped back below the $200 level and opened up on Thursday morning at 194.27, rallied about 1% and then turned tail as it busted 10-dma, 20-dema, and 50-dma support. On Friday the stock continued lower and now appears to be setting up for a test of 200-dma support and the neckline of a
Pinhead & Shoulders formation.
There is little to comment on given the latest
Orange Swan which has injected a great deal of uncertainty into the market as we head into the new trading month in March. For now it appears that long precious metals and short tech has been the optimal configuration, and this looks to be the case so far this weekend amid the latest attacks on Iran. Tokenized gold via
PAXGold ($PAXGUSD) retested the $5600 high earlier this Saturday morning before backing off slightly on Sunday, but is still up over $100 at the time of this writing.
The
Market Direction Model (MDM) switched to a
SELL signal on Friday February 27th. Earlier in the week it had switched to a
BUY signal on Wednesday, February 25th, then switched back to a
CASH/NEUTRAL signal on Thursday, February 26th before ending the week on a
SELL signal. The NVDA earnings report was the tell together with other confirming factors since the major averages could have gone either way, depending on the underlying strength or weakness of the report which, in turn, affected the major averages and other leading stocks.
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