Last week was a challenging one for U.S. markets. Until Friday, they were weighed down by elevated valuations among AI-exposed companies and early signs of macroeconomic weakness, particularly in the labor market.<\/p>\n\n\n\n
At one point on Friday, the S&P 500<\/strong> was down 3%<\/strong> from the previous week\u2019s close, while the Nasdaq<\/strong> had dropped as much as 4.75%<\/strong> compared with five sessions earlier. This was not entirely surprising, given the high concentration of Big Tech stocks in both indices, around 35%<\/strong> in the S&P 500 and an exceptional 65%<\/strong> in the Nasdaq.<\/p>\n\n\n\n China\u2019s announcement on Wednesday to block exports of Nexperia<\/strong> chips, a Dutch company primarily focused on the automotive industry, reminded investors\u2014already nervous about a potential \u201ctech bubble\u201d\u2014of the fragility of the global high-tech supply chain.<\/p>\n\n\n\n On the macroeconomic front, the Challenger Job Cuts<\/strong> report showed a loss of 150,000 jobs<\/strong> in October, three times the expected figure and the weakest reading for that month since 2003.<\/p>\n\n\n\n However, on Friday, November 7<\/strong>, after the close of European markets, a sharp turnaround occurred. This rebound, driven mainly by technical factors, led to a 3.6%<\/strong> recovery as of November 12 (11:30 a.m. CET)<\/strong>.<\/p>\n\n\n\n The S&P 500<\/strong>, currently trading around 6,872<\/strong>, formed a strong and clear hammer candlestick at last Friday\u2019s close, signaling a potential reversal. The index recovered 1.65%<\/strong> intraday from its session lows.<\/p>\n\n\n\n During the sell-off, the S&P 500 briefly fell below its 50-day moving average<\/strong>, a critical support level in ongoing bull markets. This decline coincided almost exactly with a test of the upward channel that began in mid-May 2025, within which the index has traded since.<\/p>\n\n\n\n Several heavyweight components such as Microsoft ($MSFT)<\/strong> and Meta ($META)<\/strong> had already undergone sharp corrections. Semiconductor stocks, led by NVIDIA ($NVDA)<\/strong>, AMD ($AMD)<\/strong>, and Broadcom ($AVGO)<\/strong>, also retreated from their recent highs. The VIX<\/strong> nearly reached 22<\/strong>, a level that has acted as clear resistance since at least 2023.<\/p>\n\n\n\n The rebound has been strong, and the prospect of a potential resolution to the U.S. government shutdown<\/strong> adds a positive element on the news front. The RSI (14)<\/strong> shows mild bearish divergence but has recovered from near-50 levels to around 60.60<\/strong>.<\/p>\n\n\n\n We are not far from all-time highs. The 6,885<\/strong> zone represents initial resistance, while 6,920<\/strong> marks the highest price the index has ever traded at. The 21-day<\/strong> and 50-day moving averages<\/strong> (at 6,784<\/strong> and 6,697<\/strong>) remain positively sloped. The upper Bollinger Band<\/strong> stands near 6,944<\/strong>, and the top of the rising channel currently aligns around 6,980<\/strong>.<\/p>\n\n\n\n Despite the recovery, the market appears increasingly aware of stretched valuations. Caution is advised when considering new long positions after such a strong rally.<\/p>\n","protected":false},"excerpt":{"rendered":" Last week was a challenging one for U.S. markets. Until Friday, they were weighed down by elevated valuations among AI-exposed […]<\/p>\n","protected":false},"author":7,"featured_media":104002,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[2932],"tags":[656,646],"class_list":["post-104531","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technical","tag-analysis-tag","tag-stocks-tag"],"acf":[],"yoast_head":"\nTechnical Analysis<\/h2>\n\n\n\n