Yesterday's technology-led selloff did not occur in a vacuum. Several developing narratives are beginning to converge, creating the first meaningful challenge to AI leadership in months.
The selling pressure culminated in a decisive distribution day on the Nasdaq, as the technology-heavy index closed below its 50-day moving average for the first time since reclaiming it on April 8. Volume expanded from the prior session and finished above average, signaling meaningful institutional selling rather than routine profit-taking.
Market leadership narrowed noticeably as capital rotated toward more defensive sectors. Consumer Staples, Health Care, and Utilities attracted relative strength, while Technology stocks bore the brunt of the selling pressure.
Bull markets do not die because of of old age. The chart above shows that the 1998 case (dot plot in the far upper right corner), which has drawn a lot of comparisons to the current bull, lasted the longest and registered the highest return of any bull market since 1928. In total, five prior bull markets lasted longer than the current one and eight posted higher returns.
One similarity to the late 1990s is valuation. By most measures, stocks look overextended. The total stock market capitalization relative to GDI is at a record high, and very close to the reading reached at the 2000 peak.
Until the market shows signs of renewed strength, investors should remain selectively cautious. Protect capital, avoid lagging names, and reduce exposure in positions that violate stop levels or show clear signs of price violations. Extended stocks showing decent profits should be back-stopped to protect gains.
https://t.co/JXzFFTmMtn
It is a short-term breadth oscillator measuring the number of stocks making 20% moves up or down in the last 5 days.
Extremely high bullish readings trigger market pullbacks, and extremely bearish readings trigger bounces.
Buerish signal takes 3 to 5 days to activate. A bullish signal typically works immediately.
It is calibrated based on past data.
After a strong market run, the temptation to buy laggards always rises. Don't fall for it!
The highest-probability opportunities right now are in resets and pullbacks in names that have already proven leadership.
That’s where we want to stay focused. Watching a name like $BE to offer something up next week:
I am not trying to time market tops or bottoms, I want to be involved in the trend as the market tells me to. Each stock/ market on its own merits. Our job is to LISTEN to the market.
Placing unnecessary pressure on yourself to perform irrespective of where you are in your journey is actually detrimental to your trading.
Some folks selling a dream saying "it should take 1-2 weeks to learn setups & be profitable" is ridiculous.
Mastery takes years not days.
Define timeframe by market types
Market below 50 Day - short term swings 1-2 days or day trades
Market above 50 Day - Swing 5-8 days
Market above 50 & 21 Day - Let swings turn into position trades
Charles Harris has one rule he calls aggressive — always buy the first pullback to the 50-day.
Great leaders almost always find support there at least once. That first test is where the odds stack in your favor.
Most traders wait for confirmation. Harris buys the moment the market gives him the chance