The bulls are absolutely in control again, and the market has closed above a lifetime high, indicating a strong upward momentum. The symmetric triangle has cut above the trend line, but it hasn't violated it yet, and the market is not at lifetime highs, which are about 1100 points away. The market is in a bad state with bears looking strong, and the VIX is at extremely low levels, indicating widespread complacency despite ongoing declines.
Crude oil is on the rise and may get a lot higher due to geopolitical developments, with a basing pattern forming after an explosive spike and subsequent lower highs. ES is bullishly configured and continues to be an existential threat to bears; bonds are in a seventh-year bear market and expected to continue collapsing, while tech stocks like ENQ are obeying a trend line with a symmetric triangle formation. The semiconductor index (SMH) is showing bearish momentum, and the broader market environment of rising interest rates and collapsing bonds suggests a negative outlook, with potential for further downside after the midterms. The market has generally sucked for the bears for the past eight trading days except today was pretty good and it'd be nice to see more of it.
The market reacted positively to Trump's boy Kevin Worsh's comments, but equities were volatile, with ES bottoming about two hours and 10 minutes into the trading day before rallying unexpectedly. The creator noted a price gap closure in SPY and ES, which prompted a short position, calling it a "brilliant trading decision." A diamond pattern was observed in Carvana and Meta, with the expectation of a sharp decline. The creator also referenced a prior breakdown in ENQ as a potential model for broader market participation.
The creator stated that they still favor semiconductors on the short side, noting that support has become resistance and describing a "fantastic chart" with a "shooting star" pattern and a "beautiful rounded top" on AMD. Additionally, the creator observed that Seagate formed a head and shoulders pattern with a measured move target aligning with a price gap.
The market has been forming a series of lower highs since the lifetime high on June 22, with recent price action showing increasing chaos and failure of support, particularly on Friday, suggesting a breakdown; the completion of a diamond pattern in SMH adds to the bearish thesis. Long term, this looks very bearish. We need to break below the low of June 9th, which is 685.62, to set us on course for a tumble down to as far as this area around 635.
The creator's thesis is that SOXL, a leveraged bullish ETF on the semiconductor sector, has shown a strong upward trend with successive highs, though each subsequent high shows decreasing energy, indicating a potential weakening of the momentum. Applied Optoelectronics (AAOI) has a history of topping and dropping, with instances of nice tops followed by big dips below, and the most recent instance shows a rounded top forming and starting to break down. The creator is short AMD, ARM Holdings, Broadcom (AVGO), and AXTI, believing that these stocks have peaked and are showing signs of weakness or topping patterns, with specific resistance levels identified for each. The creator is short SOXS, which is the inverse of SOXL, and believes the stock has completed an inverted cup with handle pattern and broken down. The creator believes the SOX semiconductor index may have turned the corner from its long-term bull market, with a potential reversal signaled by a price gap, and they are playing this with a combination of individual shorts and long January 2027 SMH puts.
There's a lovely perspective set up for a really serious tumble with a target of somewhere maybe down around there, and Bitcoin is setting up a challenge to the psychologically crucial $60,000 level, with the creator shorting this by way of being long BITI, also wanting crypto to get the crap kicked out of it. LEN is rallying because they're home builders, but the creator is maintaining their January puts and not dumping them, indicating a cautious approach.
Informational only — Slope of Hope’s view, decoded by Plutus. Not Paid Daily’s advice or a recommendation. Levels and claims are extracted from what the creator said; verify before acting.