Transcription
Today's number, guys, is two. As we've only seen something like this happen a couple of times before, just before the dot crash and last year before the tariff tantrum and the fallout that happened after that. So, why should we be paying attention to the fact that big tech is selling while Wall Street moves into defensive stocks? And how does this implicate everything moving forward into 2026?
Well, in today's video, we take a look at it from both an investor and traders perspective as we see gold and silver bounce off levels we discussed in previous videos. And of course, the S&P 500 wrangle with a very important zone. Yes, we hit 7,000 and we've rejected it once again. And this zone is really important. Guys, let's take a look at stocks, commodities, and cryptos to what you need to know and what you need to be watching right now. See you soon. This is going to be a good one.
Well, welcome back everybody to the daily show where we discuss everything from the macro to the data to what you need to know about the key levels in the market and what Wall Street's been up to. My name's Thomas Atinson and we've got a lot to discuss because semiconductors were down, big tech was falling, and many different sectors that we've been discussing on the channel recently have actually been rallying through. And it starts to make us think, is there something going wrong?
Well, we've also got another single from the Hindenburg omen, which as you guys might remember can sometimes show, especially in clusters, a big problem is on the horizon. Let's start off though with this great data from Subu Trade over on X and that is that the tech sector was down while the staple sector was up and you can see the cluster of times that happened over here in the 2000s into the crash and then of course just before the tariff tantrums of last year. So why does this matter? Well, the data stats are of course incredibly negative when it comes to the next 6 months, 9 months, and even one year later. And you can see here that there are quite a few bad reads that tend to happen after stuff like this.
Why? Well, big money is kind of fleeing the main big tech stocks. And we've already seen this in a slowdown on the Magnificent 7 since the Federal Reserve started doing, of course, cuts back in September of last year. And if you've been watching this channel, and by the way, if you're new here, welcome. Make sure to subscribe. Hit that alert button. It's great to have you on board. We have been discussing this for quite a few months. We've been thinking about oil differently to a lot of other people. We've been thinking about metals and of course staples, utilities, healthcare, and many other sectors.
So, as Duality Research posted over on X just a few days ago, we see here that tech sector, while it slightly recovered during the last kind of month, realistically was one of the worst sectors out there. Energy, materials, staples, industrials, they were the ones that were going. And we actually saw a broadening of the market, which on the surface you might say is a good thing, and it is for now, but it actually does usually start to make us think that we're in what we call late cycle, where financials in particular, start to come under pressure, and what was once good, which was of course growth stocks, starts to look a bit flaky.
So, have the earnings caught up to this problem? And also, should we still be paying attention to earnings more than anything else in 26? Well, Lizanne Sunders here has the latest data when it comes to weekly ETF flows. And you guys can see here that people have continued to buy large cap US stocks. But at the same time, it's likely this is a lot of retail investment and actually global investment has been where the money's been moving, especially over the last 6 months. And we've seen that into the Asian stock markets, obviously into emerging markets throughout South America and so many places, specifically where we saw kind of cheaper indices and maybe even commodities based stocks.
And this really shows up when we take a look here at how the biggest Magnificent 7 stocks have actually been trading. We now have, of course, some from earnings, more to come this week. We still have, of course, Amazon, Alphabet, and some very important results there. But so far, Microsoft has been absolutely getting flawed. And you can see here that it is really declining this year along with some pretty big moves as well when it comes to Nvidia starting to drop a little bit. Tesla starting to get shaky and Meta while it recovered possibly starting to give up some of its gap fill style moves.
So, what does this tell us? Well, it tells us that the leadership of the market is starting to potentially weaken. And as we often say on this channel, it's really about the new DAO theory. Semiconductors, if they start to fail, then we've really got problems. And there's a few codes that we'll bring up later on today's video that I really think a lot of us should be tracking in 2026 because it's going to be super important.
Now, last year on the channel, we talked about the Hindenburg omen and we [clears throat] discussed the idea that when you get Hindenberg omens, especially in clusters, they can lead to, of course, more significant data points. Now, Hindenburg Omens have been very famous at calling things such as the 2021 highs, obviously many crashes before that going back into the global financial crisis and stuff, but Subu Trade has bought through uh all of the data points here from the most recent ones. And you can see that when they cluster up a lot, it can have at least a pullback style effect. And while I wouldn't take this as the only read, this coupled with things such as defensive stocks starting to get picked up and also this data point that we bought in our previous video which is falling US truck sales which could point to a weakness in the economy.
Yes, there are some reasons why it could have also happened for other things which we discussed in our last video. But these are the types of signals that you often get when there is a dull late bull market cycle and effectively with the new Fed chair as well. While we probably expect to continue to get liquidity maybe for 26 into the midterm elections, what might happen after that could be very different. And on top of all of this, if we do get what his plan is, which tends to really rely more on getting rid of liquidity tightening a little bit and then if something catastrophic happens, then of course, you know, realistically letting the floodgates out. remember he was a big proponent of the global financial crisis overall package that of course the Fed did to help secure of course the crash but he's kind of like we fix the problem after it's happened more so than what Jerome Pal's been doing which is slowly providing liquidity all the way through to help stave off any problems. Yeah. Which one do you like more? Be interested to know your comments down below. But in general, these are signals that things are starting to weaken and they're not the traditional signals that you'll see on most channels and most people talking about. These are the ones that I do tend to believe still have some edge in these markets.
Speaking of edge, quarterly EPS estimates do continue to do some pretty good stuff. You can see here that the overall earnings has been pretty stellar. And we've seen that with effectively stocks that have performed well and have beaten have actually gone up and ones with poor guidance or have missed as you'll see with PayPal in a moment. They've gotten destroyed. They have actually fallen through the floor and the market is very very um I guess you would say on tent hooks in some ways to these earnings. If we do see some of the Magnificent 7, let's say in the next earnings, not living up to expectations, you can see they might be Microsoftesque style cells across the Magnificent 7. And as you know, if you've been watching for a long time, the concentration in these markets because it's mostly tech, 37% is made up on the S&P of top 10 stocks. Then all of a sudden, you could be actually declining quite a lot. So things get pretty nasty fairly quickly if that occurs.
Now, with the S&P actually going up and the NASDAQ not really doing anything, you might say, "Well, does this mean that we've completely lost everything?" Not usually. At least at the beginning, there does tend to be a decent rotation. And this, of course, provides opportunity. And what tends to happen is you see weak uh the leadership turn into weakness. And of course, IGV, which is software, has been dropping consistently now for quite some time. I thought I'd include this stat just so you guys can see. IGV six consecutive days down here from the market stats and you can see there's some decent turn stats but as we always say look for the bid more than anything else.
Now let's move over to app economy insights and their updates for the latest earnings. Palunteer of course was a very solid earnings. They're doing very well uh during the last kind of 12 months and you can see here the gains are pretty much just absolutely stellar. It's unbelievable results from them. But what wasn't so unbelievable was PayPal's results. You can see here not too good across the board and the stock went down around 20%. We also saw AMD come through and yes they had pretty good revenue and it was actually a little bit of a beat but overall you can see the stock did not react well. It was down about 6% last time I checked in after hours trades. So basically it was a sell day across most semiconductors and most tech and AMD felt some of that pain as well.
There are still more coming. Alphabet after the Wednesday close, ARM as well, Qualcomm, Snap, Amazon, plenty of stuff here. And I think what the focus might be on is what is happening to the American consumer. And you're going to see that in the code XLY versus XLP, which we often talk about here on the channel, which is a good read of around a third of the US economy on the charts. And it's not really our opinion, it's whether there is actually a weakness starting to appear. And I can tell you that actually broke down and below over the last 24 hours. So this is a fairly big day for that indicator indeed.
Um, everything else here are the options moves from earnings watcher. And you guys know that you know the big thing there with earnings is that usually earnings provide opportunities but actually because the market's been so volatile especially in metals and then of course also in other sectors that started rolling it's been pretty good actually not even to bother with the earnings too much and actually focus on the other sectors which have been running pretty well. I mean energy's done pretty well recently as well and that came out of of course nowhere for a lot of people but we've been seeing it here in flows.
Speaking of strange flows, we did get a number one dark pull that just came through here from ARX. And this is courtesy of volume leaders. And you can see here it's a monster trade. Pushed ARX up. And obviously this is the space exploration and innovation. So we all know why. Of course, this year is going to be probably some IPOing of SpaceX, etc. And we're getting a lot of people very very um I guess you would say confident and feeling good about that type of sector. I would always say that sector is probably more of a trade than anything else. But hey, you guys often like to uh look at the space. Remember Virgin Galactic? That one was interesting though.
GLD, what happened here? Couple of large trades. Obviously, gold has since recovered to this point. So, just remember if it keeps going up. These were likely buys. And I do think that nothing much has changed. Even though we've got a new Fed chair announcement in general, we have to kind of look at it as we're still in a currency war in terms of how the world is going and a lot of the things that are already still around are probably going to continue being around. So realistically, I don't think there's too many changes in that aspect, but we're still investigating and we'll bring updates as we see more things uh to talk about there.
Now, if you're talking about silver crashes, this was of course historic, which means we have to look at historical data. I know this is a bit hard to view here on the charts, but basically the general gist is when you get a crash like this, although sometimes they recover, this one here did. Most of the time, what will happen is it will kind of bounce pretty quickly and then it will go into a period of decent consolidation. So, at least that's what the averages have been. You can see here the average. And I think that with silver, it kind of just points to the easy money has probably been made and now it gets a little bit more difficult. But of course, the bounce looks easy right now, but this is just the stats that have happened before, and silver does tend to do it this way.
Some more positive news, energy stocks continue to rise. As you can see here from the market stats, they have some incredibly good breadth on them. And we also have, of course, some large trades coming in the crypto markets, although they really haven't stabilized. Uh, huddle here, number one trade. Obviously the price is underneath this at this stage. But what we did find out over the last kind of 24 hours is that around 76K I believe is the average entry I believe for Micro Strategy because they've been buying for quite some time. So we really are at that kind of critical point and I think Micro Strategy is the real discussion here for Bitcoin in many ways.
Now if you look at that looks like an hideous head and shoulders. Yeah. So [laughter] you you'll want to be watching this one pretty closely, but uh generally speaking, Bitcoin of course on the next level of serious serious zone. And if it gets past here, you could see it go to 68. And I I feel like something might have to buckle before that really turns around. But BTC price versus supply and profit is now actually sitting at around uh 56. So that basically means that 44% of Bitcoin supply is now underwater. And that's a pretty big deal here. Top buyers near the all-time high are now holding at a loss at concentrated supply with cost basis near recent highs is being tested. So basically according to Sean Rose here over on X and Glass Node, you can kind of see that a lot of people are actually now below the average, especially people that have purchased in more recent history.
So where does this bring us to? Well, it brings us to what we probably expect is going to be a very high volatility in terms of a midterm year. And one of the reasons why that might happen is because of course the Fed with the new Fed chair may not be giving guidance anymore. So do remember that's also going to come into all of this. Look, do we have a market that's turned around yet? The answer is quite simply no. But what we do have is that critical 7K marker and we've hit it twice now and rejected. So I guess it's time for us to talk about all the fibs that also sit on this level. So it doesn't matter whether you take fibs from the 2022 kind of lows or you take fibs from the tantrum of last year where we course got liberation day and then we rallied through it. All of these extensions including I believe extensions coming from all the way into the global financial crisis lows according to JC Parrots over on Allstar Charts. They're all hitting these resistance points all at the same time.
So basically what this is telling us is that the market clearly doesn't like to break 7,000 easily. That's no surprise when you see the amount of call options that are there. And while this is not necessarily a strong sell signal, what it can do is it can create some people taking profit because this is a psychological number and other things. So it really kind of opens up to sector rotation being continuation of the thing that's best to do. And of course, we've already said that for months because actually the S&P has been doing nothing since October. So remember when that Fed uh cut came through, it really did change the game.
In terms of overall, this these are not the new option high lows. I didn't manage to get them for today. But you can see here we're still just kind of consolidating up and down. And I guess the index is less interesting than the single stock. So we'll get into those in a moment. But let's have a look at the S&P. You can see here 6875 put walls starting to appear. 6850s as well, 6900s on the 6th of Feb. So really this week it seems like quite a lot of put pressure sitting around that 6900 zone. If we start to drop that, we could be starting a waterfall effect which can of course get very brutal very very quickly. But 7,000 remains the core wall. So until we break that really it's going to be a bit tough.
On to IBIT. Uh we notice here that around 44 seems to be a pretty important level and 40. So 40 on IBIT I think would equal into around 60 67K 68K. So effectively if Bitcoin falls through here it's likely that the next level of equilibrium is somewhere around 40. So we got to be a bit careful about Bitcoin and of course it is currently in more of a negative gamma kind of space. Tesla sitting barely holding on to 420. We can see 420 is where all the puts are. So again we drop 420 that's going to be pretty bad for the stock. and gold. Well, it's doing okay, but 460 is kind of the main core wall at this stage. So, we'll continue to update on those. And some of them got a little bit messy, including gold, because of course, we've had those really large moves. So, we'll update as we see those come through, guys. Make sure to sub for that.
Let's now move over to the general market. First up, we'll start with lead indicators. So, we mentioned before that we the American consumer might be weakening. Well, we saw a break below this kind of level here. And what that's telling us is that we could be in for a little bit more weakness in the stock market. You can see here that this has kind of been pattering out for a while, especially since, of course, the Fed started cutting. Remember, the Fed doesn't really, well, they're not meant to cut for no reason. They're meant to cut because weakness is coming through. And so far, this is starting to lead into the American consumer, which is onethird of the US economy. And you can see this indicator actually broke below.
We also note that at the start of today's video, we talked about XLK vers XLP. Well, that also broke below as you can see over here over the last 24 hours and it kind of looks like one of those head and shoulders. So, if that's going to complete then we could be again seeing further weakness when it comes to uh these stocks. Some other things to note, XLP which is a defensive of course staplesbased sector that's absolutely skyrocketing. At the same time, that's skyrocketing. We haven't seen bonds freak out yet. So I am waiting for that to really show proper signals of of selloff. But we have been watching things like corporate bonds and other things as well. We're also not seeing too much movement on the dollar just yet. Kind of like up down all around. Still testing that multi-year trend line. So we'll see how that plays. And US 10year yields and yields do continue to rise which we've kind of been talking about. We we feel like this could be pressuring things like oil as well. And it'll be interesting to see how financials are impacted by this. Remember, if financials start going down and 10 years going up that is another warning canary. So there are a few things to to be watching but at the same time obviously at the moment it's a stock pickers market and a sector pickers market.
Technology stocks may not be doing well, but energy stocks are doing very very nicely. And you can see here the breakout continues almost a new all I guess it did get an all-time high over the last 24 hours. And gold managed to rebalance back up to just over 5,000 an ounce. Kind of making back about 50% of the drop. And you might say, is that mean gold's all good? Well, I would say while not much has changed in terms of overall policy just yet, the one thing is for sure is that when a currency war starts um statistically anyway, it usually continues for quite some time. So, you've got to always think of it as going for decades. And therefore, I'm of course very macro bullish. You guys know this. You've been watching the channel for a while. We've been talking about gold for years. But my overall aim might be $7,500 an ounce. But I still think that gold what it showed the other day is going to be, you know, something that isn't easily taken out. Um, so it may take a while.
Now, this is this is pretty devastating to what happened to the metals. Silver has bounced up, but nowhere near as much. And you can see that the hiding that it took and obviously this little demand zone down here at the 75 level is holding. So, we got some crossorrelation with that. Copper and other things. You can see here copper's picked up quite nicely as well. So, fairly strong stuff there. Another one in oil. Just have a quick look here at barrels. You can see barrels picked up off that level we discussed in the previous video, which is pretty cool. And the VIX did also jump 10, but it was up 20% at one point. And you can see then it dropped back down. So clearly volatility is is alive and well in this market at this stage. Chinese stocks kind of just hovering around the same level coming into Chinese New Year and Tesla holding 420 on for dear life as you can see there. But if you have a look at something like PayPal, take a look at this. This thing's been dropping for quite some time. But look at that drop, guys. When you miss and the market doesn't like what it sees, wow, it's really hitting stocks. So keep that in the back of your mind. You know, in earning season, it's all good when they're beating and beating expectations, but the market when it starts taking out that forward premium, gez, they give it a hiding.
Magnificent 7, you can see here, still looking a little bit weak. So, not too much going on in the big tech. And therefore, that means the index won't be able to move up too much if we don't have big tech leading. And semiconductors also weaken. So, one of the things we're going to do as a code here is semiconductors versus SPY. And you can see while that's still overall up for a long time, it is starting to weaken a little bit, which just shows there's some jitters in the market. It's not necessarily like diabolical, but certainly some jitters starting to appear.
Meanwhile, in Bitcoin World, we ended up getting a new low. We went as low as 73,000 and then managed to bounce back up to barely holding on to that low level over here as you can see which is about 75k. So that could be a sweep and because it didn't close underneath it's un not yet confirmed kind of a 68k 66k but certainly a very important level. And now what we can do is we can go into the 4hour time zone and we can actually put a big resistance line here at 792. That's going to be a strong sign that buyers have actually started to commit back to Bitcoin and I'm pretty sure we'll see the similar thing through major cryptos as well.
Guys, to put a summary on today, well, first up, make sure to go and check us out on X. Um, obviously check out our courses and Market Masters Club if you want to know more about rotation and things over at fxevolution.com. But to summarize today and the markets, I think this is more of the same of what we've been talking about since September. It's a rotation market. It is not a tech market at the moment. And tech has to be very specific if you are going for it. And it looks late cycle. So basically that means that you've got to be a little bit more careful in late cycle. But the market is still trundling on up. It also hasn't been really an index market. It has been a market of stock picking which is pretty cool if you know a little bit more about markets and I'm pretty sure some of you guys do. So if you enjoyed today's uh commentary, make sure to subscribe, smash that bell, and we'll see you in the next one. But I don't think this is necessarily to fret about because earnings are still good.