| | | | A Tale of Debt, Denial and Opportunity?
First, don’t miss today’s Daily Chart Setup trade idea down lower in this newsletter.
The AI bubble is cracking as tech giants drown in over $75 billion of fresh debt while OpenAI quietly begs for government bailouts — here's where savvy investors should look for opportunities beyond the hype.
Come join me as we dive in and see what’s moving!
Plus, as always, we have stocks popping and dropping so come find out what is moving this morning as I look for stocks and do some live premarket analysis on SPX, SPY, NDX, QQQ, Russell, IWM and other stocks that are potential plays for the day.
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Reading the S&P 500, Nasdaq and Bitcoin for the Next Major Moves
There's a lesson I've learned the hard way over the years: the market doesn't care about what you want it to do. And right now, we're sitting in one of those periods where the price action just isn't clear.
If anybody tells you the S&P 500 is showing clear price action right now, they're full of it. Here's what I'm seeing…
We got a three-wave move off the recent low that pushed up near a level that can be bullish, but the retrace looks muddy — it's unclear, and that's the important point.
So where does that leave us? This recent low is kind of our tell right now. As long as we're staying above it, it sets us up for the next move higher. If we can break out above Thursday morning’s high, we're probably going higher — possibly trucking up toward 7,000 over the next couple weeks.
But if we break down below that low, we're probably still flushing it out.
Here's something worth considering: We’re sitting at extreme fear on the sentiment indicator, and people started easing back a little as the day went on Thursday.
When we're down at extreme fear like we have been, we're probably going higher. The market has a funny way of doing what hurts the most people — we can't push the market down when everybody's prepared for a move down.
NDX Is Showing Clearer Structure
Funny enough, the Nasdaq (NDX) is a little more clear here...
I'm seeing three waves down, three up, and we're probably looking for another move down. If we can hold right above a key vicinity with this move down, this could be kicking off a one-two-three-four pattern, and then we go up and make a high higher than the recent high for a fifth wave.
That move would have to be bigger than the previous rally because it was relatively small. We may just get a nominal higher high, then probably come back down again because this would more than likely be a wave one and two, which could push us up for a wave three that could be very aggressive to the upside.
But here's the critical part…
If we start overlapping the recent high, this pattern isn't the high-probability setup anymore. Don't ignore that. As long as we can dip to a lower low and then come back up to make a higher high after a retrace, that would be the opportunity.
Bitcoin Flashing a Yellow Flag
Bitcoin — I don't have anything great to say at the moment. This possibly was a bottom, but we kind of pushed back up through key levels in a three-wave fashion, which isn't really good for continuation.
Here's the difference between what's happening in NDX and what's happening in Bitcoin: When we get three waves off a low and stop in the typical correction zone, that's usually trend continuation — not a reversal.
Bitcoin didn't even get up into the zone that would signal a potential reversal before starting to come back down.
For those of you hoping this was a bottom in Bitcoin, this is your first warning flag — your first caution yellow flag. We might be going lower.
The key in all of this is respecting what the market is actually showing you, not what you want it to show. When price action is unclear, the best trade is often patience.
Now be sure to join me live at 9:15 a.m. ET for “Morning Monster,” my market-open livestream on YouTube!
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