David Settle, CMT

Market Technician. Active Trader. Passionate about Investor Education. Part-time 🏀 coach. Father to FOUR boys. Co-founder of @MarketScholars 👨‍💻🎙️📈💰👨‍🎓

[David Settle, CMT @davidsettle]

06/05/26 – View tonight’s #MarketOutlook from @MarketScholars

🎥 https://t.co/GdLy5uBjUT

Discussed:
⚠️ Hot jobs hit rate-cut hopes
🤖 AI funding fears weighed on tech
💥 Semis and chips got crushed
📈 $VIX spiked as traders hedged
🛡️ Defensives led: $XLP $XLU $XLV

$SPX $SPY $QQQ $IWM $NDX $SMH $NVDA $AVGO $META $XLK $AIQ $ARKK $TNX $VIX

[David Settle, CMT @davidsettle]

A good chunk of the Internet-related productivity boom occurred AFTER the peak of the secular bull cycle in $SPX

[Mike Zaccardi, CFA, CMT 🍖 @MikeZaccardi]

MS: We Are Likely in the Early Stages of Another Productivity Boom

[David Settle, CMT @davidsettle]

@LifeLessonsAcad The big difference between then and now is the potential wrench any Iran war headline can throw into the equation.

[David Settle, CMT @davidsettle]

Here's something to think about:

On January 5, 2024, $SPX broke a 9-week winning streak that produced a 16.2% rally with a 2.0% decline before moving higher 7 out of the next 8 weeks. Short-term sentiment (red and blue lines) on the Market Forecast looked strongly bearish and the intermediate (green) line was on the verge of crossing below Market Sentiment (orange line) - look at 1st chart.

Fast forward to today. $SPX broke a 9-week winning streak that produced a 20.0% rally with a 3.0% decline. Short-term sentiment looks bearish and the intermediate line is about to break below long-term Market Sentiment - look at 2nd chart.

Both rallies occurred AFTER deeper-than-normal pullbacks (more than typical 5%) that didn't produce extended runs below the 200-day SMA.

Why did stocks fall January 2-5, 2024? You can almost use the same headlines from this past week. Mega cap and chip stocks fell big. Yields rallied in part because of a strong labor market report on January 5, 2024 that reduced Fed rate cut odds.

Sound familiar?

[David Settle, CMT @davidsettle]

The momentum line for $NDX hit extreme lows but the near-term line stayed out of the lower-reversal zone. This is a positive sign for the tech-heavy index as extreme lows on the momentum line that DON'T lead to pullbacks tend to be really good bounce opportunities.

https://t.co/S2HTrrJhR5

$QQQ $SPX $VIX $TNX

[David Settle, CMT @davidsettle]

Micron's 1-month return is still 35% despite its 3-day "bear market" $MU

[Walter Deemer @WalterDeemer]

Micron has plummeted 20.7% in the last three days. (Look carefully!) In the process, it gave back every bit of its gains of (checks notes) the last two weeks. And although the 20%-plus decline puts in a media-defined "bear market", it still sports a 174% year-to-date gain.

[David Settle, CMT @davidsettle]

All the other instances where $SPY has more than 1.5 times its 30-day average volume and we WEREN'T in an intermediate decline (orange boxes), usually ended up being buying opportunities.

[David Settle, CMT @davidsettle]

📰 Read the full Market Outlook blog post (free for Basic subscribers):
👉 https://t.co/hWj5UgYWBR

💡 Knowledge. ⚙️ Application. 🤝 Community.
@MarketScholars

[David Settle, CMT @davidsettle]

06/05/26 – View tonight’s #MarketOutlook from @MarketScholars

🎥 https://t.co/GdLy5uBjUT

Discussed:
⚠️ Hot jobs hit rate-cut hopes
🤖 AI funding fears weighed on tech
💥 Semis and chips got crushed
📈 $VIX spiked as traders hedged
🛡️ Defensives led: $XLP $XLU $XLV

$SPX $SPY $QQQ $IWM $NDX $SMH $NVDA $AVGO $META $XLK $AIQ $ARKK $TNX $VIX

[David Settle, CMT @davidsettle]

@Grownded

[David Settle, CMT @davidsettle]

I get asked why would you say a 20% decline in this instance is just "noise" and not even a pullback where the traditional definition would say it's a bear market.

It's because of the rally that preceded the 20% decline. In this case, to get to the level of 24% ABOVE the 50-day SMA, $XLK rallied 55.4% in just 44 trading sessions. That's a tremendous rare rally that literally has NEVER happened before in the history of the ETF.

In fact, $XLK had 12 2% daily gains since March 30. That's 12 out of 43 days, or 28% of all trading sessions. Before that, $XLK had 12 days of 2% gains or more from April 22, 2025 to February 6, 2026 - or 200 days (6% of all trading sessions). And, that was also considered a rare move for that timeframe (only 3 other times had bigger 200-day moves all time)

So, a 20% drop in these conditions is much different than "normal."

[David Settle, CMT @davidsettle]

Not all 10% declines are corrections. $XLK closed Tuesday 24% ABOVE the 50-day moving average. $XLK is down 9.04% in the past 3 days and is STILL 10.61% ABOVE the 50-day SMA.

Pullbacks break the 50-day SMA. $XLK can essentially drop 20% and STILL not even be in pullback mode. It would just be noise.

For context, $SPX has only been 15% above the 50-day SMA ONCE EVER in 1982.

[David Settle, CMT @davidsettle]

Not all 10% declines are corrections. $XLK closed Tuesday 24% ABOVE the 50-day moving average. $XLK is down 9.04% in the past 3 days and is STILL 10.61% ABOVE the 50-day SMA.

Pullbacks break the 50-day SMA. $XLK can essentially drop 20% and STILL not even be in pullback mode. It would just be noise.

For context, $SPX has only been 15% above the 50-day SMA ONCE EVER in 1982.

[David Settle, CMT @davidsettle]

Not all 10% declines are corrections. $XLK closed Tuesday 24% ABOVE the 50-day moving average. $XLK is down 9.04% in the past 3 days and is STILL 10.61% ABOVE the 50-day SMA.

Pullbacks break the 50-day SMA. $XLK can essentially drop 20% and STILL not even be in pullback mode. It would just be noise.

For context, $SPX has only been 15% above the 50-day SMA ONCE EVER in 1982.

[Bespoke @bespokeinvest]

The Tech sector $XLK is already down 7.5% since Tuesday's close, and down 5% today alone. Closing in a 10% correction quite quickly.

[David Settle, CMT @davidsettle]

$SPX has dropped more than 2% two other times in the past 12 months (1st chart). Didn't seem to be a big problem the other 2 times (2nd chart)

[David Settle, CMT @davidsettle]

"falls short"

[Hedgeye @Hedgeye]

The S&P 500 falls short of a 10th straight up-week

[David Settle, CMT @davidsettle]

All the other instances where $SPY has more than 1.5 times its 30-day average volume and we WEREN'T in an intermediate decline (orange boxes), usually ended up being buying opportunities.

[David Settle, CMT @davidsettle]

$SPX has dropped more than 2% two other times in the past 12 months (1st chart). Didn't seem to be a big problem the other 2 times (2nd chart)

[David Settle, CMT @davidsettle]

$SPX is still up >23% over the past 12 months. So, if it lost $2T today alone, we have to keep in mind that it has gained nearly $20T in market cap in the past 12 months going into today.

$SPX lost 200 points today exactly. But, it had gained 1645 points in the past 12 months going into today

[The Kobeissi Letter @KobeissiLetter]

What just happened?

The S&P 500 just erased nearly -$2 TRILLION of market cap just hours after 3rd strongest US jobs report in 18 months.

Meanwhile, Bitcoin is officially down over -50% from its record high in October 2025.

What's happening? Let us explain.

(a thread)

[David Settle, CMT @davidsettle]

🤔

[OddStats @OddStats]

Definitely a healthy, thriving economy:

The second highest performing basket of stocks so far this year is TECH COMPANIES THAT MAKE NO MONEY AND HAVEN'T TURNED A PROFIT

[David Settle, CMT @davidsettle]

@TeeplesCY Maybe because all of our clergy are unpaid and we know them well since they're all our neighbors and we end up essentially "taking turns" so to speak in leading local congregations through so many different leadership callings, more than just the bishop