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The Market Has Seen Better Weeks..
Happy Sunday. Stocks are breaking down just before a huge week ahead. Lets take a look at what happened ⬇️
MARKET RECAP
S&P 500 Has Worst Week in Over a Year
SPY Daily Chart
The S&P 500 broke down and pulled back just over 3% this week. It was a relatively quiet week on the market calendar aside from a couple of big earnings reports. Netflix and Taiwan Semiconductor Manufacturing (TSM) reported Thursday afternoon and both gapped down big Friday taking the entire market with them.
As I discussed in last weeks newsletter, its no surprise that SPY posted a red candle every single day this week and didn’t really show any signs of reversing back up. These sell offs can usually be predicted when there is a trend break. Zooming out on the SPY Daily Chart below you can see that SPY broke the white trend line I drew in about 3 weeks ago. Then as soon as the 8 and 21 ema’s crossed we haven’t seen any green.
SPY Daily Chart
These sell offs are normal and healthy for the market. The question is when will this pullback bottom out? This week we have some major market movers with 4 megacaps reporting earnings and a new inflation report on Friday. These will give investors a better idea of what to expect here in the next few months.
TRENDWATCH
MSFT is Breaking Down Ahead of Earnings
Microsoft got crushed this week breaking well below the 50 moving average. The highly anticipated MSFT earnings report is this week so I will be keeping my eye on that to see how investors react to the report.
Last Weeks Trend: AAPL
Last week I pointed out AAPL as my trend watch to see how it would respond to the 50 ma. AAPL ended up rejecting hard off the 50 ma and falling well below the 8 and 21 emas.
In the News
🚗 Tesla is laying off 10% of its workforce.
📱 Apple iPhone sales drop 10% while Samsung claims top spot in smartphone sales.
💰 American Express and Goldman Sachs stocks both rise after crushing earnings.
💻 Google announces employee layoffs.
UPCOMING WEEK
It is going to be a busy week in the markets with big earnings reports and fresh inflation data. Here is whats on deck:
Tuesday: Tesla and Visa earnings.
Wednesday: META and IBM earnings.
Thursday: Microsoft and Google earnings. Q1 GDP report.
Friday: Exxon and Chevron earnings. PCE report.