Trading The Close Market Recap - 01/06/2026: Memory Chip Rally, Mega-Cap Breakdowns & Commodity Setups

In a market session defined by explosive momentum in some corners and technical breakdowns in others, traders were given a masterclass in sector rotation and the importance of predefined levels. In this afternoon's Trading The Close show, Pro Trader Drew Dosek of Verified Investing dissected the parabolic moves in memory chip stocks, the cautionary signals flashing in mega-cap names, and the critical patterns forming across the commodity landscape. Today’s analysis provides a roadmap for navigating a market that is anything but uniform.

The Memory Chip Supernova: Fundamentals and Technicals Collide

The undisputed story of the day was the breathtaking rally in memory chip companies. While the broader market posted respectable gains, stocks like SNDK put on a performance for the ages, accelerating an incredible 27% in a single session. This move is part of a much larger trend; as Drew pointed out, the stock has surged over 592% since September. To understand this explosive price action, we must look at the powerful fundamental narrative driving it.

Drew explained the core catalyst: a strategic pivot by major manufacturers like Samsung. These companies are reportedly increasing prices and creating a supply crunch for consumer-grade memory. Why? They are prioritizing their most profitable products and directing them toward the insatiable demand from the artificial intelligence sector.

“What a lot of these companies are doing are not selling the cheaper memory products to people like you and me, rather they're focusing on the high profit products in which they're selling to AI data centers… they're narrowing their scope of products offered and then also highlighting the ones who are going to pay the most.”

This business decision is creating a massive shortage for everyday consumers and businesses, meaning the next computer you buy will likely come with a steeper price tag for memory. For the chip companies, however, it’s a profit windfall, with margins on some AI components reportedly exceeding 70%. This fundamental backdrop is the fuel for the parabolic moves we are witnessing.

However, even the strongest rockets eventually encounter resistance. Drew masterfully applied a parallel channel to the SNDK chart, identifying a significant resistance zone between $364.00 and $365.00. With the stock closing around $350.00 and still climbing after hours, this level is now squarely in focus. Similar patterns are playing out in peers like WDC and STX, which are also pressing against the upper bounds of their respective channels and showing deeply overbought readings on the Relative Strength Index (RSI). While momentum is a powerful force, these technical ceilings represent high-probability areas for profit-taking and consolidation.

Mega-Cap Divergence: A Clear Case of Rotation

While money poured into the memory sector, some of the market’s biggest titans showed signs of technical distress, painting a clear picture of institutional rotation. Apple and Tesla, long-time market leaders, both ended the day with bearish chart patterns that demand attention.

Apple’s price action confirmed a breakdown of a classic head and shoulders pattern. This is a significant bearish reversal formation that suggests a trend change from up to down. The measured move target for this breakdown points to a potential decline toward $249.38. Drew noted that we could see a relief bounce first, possibly to the $258.00 support area or even a retest of the broken neckline around $268.00, before the downtrend resumes. This relative weakness in a market bellwether like Apple, while smaller tech names soar, is a textbook example of capital flowing from established leaders to the new hot sector.

Meanwhile, Tesla has also flashed a warning sign. The stock broke below a key inclining parallel channel for the second time recently. Drew described this as a “brand new break,” suggesting that the previous recovery was a failure and bearish momentum is reasserting itself. A close below the $427.00 level would confirm this breakdown and open the door to a move down to the next support at $408.38. While a longer-term inverse head and shoulders pattern still offers a bullish thesis for Tesla, the near-term price action is decidedly negative, indicating a battle between short-term sellers and long-term buyers is underway.

Bitcoin's Wild Ride: A Lesson in Timeframes

Bitcoin provided a perfect illustration of why looking at different chart timeframes is crucial. An investor glancing at the daily chart would see a relatively quiet, sideways session. However, the intraday action told a much more volatile story.

As Drew highlighted by zooming into the 10-minute chart, Bitcoin experienced a sharp sell-off right at the stock market open, plunging to a low of $91,225. Yet, by the end of the day, it had clawed back nearly all of its losses to finish near the middle of its recent range. This type of action is what Drew referred to as a "test candle." After a multi-day run-up, the market is testing the conviction of both buyers and sellers.

The key takeaway is that Bitcoin is currently consolidating right below a major resistance zone. If it can absorb this selling pressure and hold these levels, it has the potential to barrel through and target the next major psychological level at $100,000, followed by a trendline resistance near $105,000. The intraday shakeout served to flush out weak hands before a potential next leg higher.

Commodities at a Crossroads: Patterns to Watch

The commodity markets are offering up some incredibly clear and actionable technical patterns that traders should be monitoring closely.

Gold: After a strong push higher, gold is now approaching a formidable resistance zone just above $4,500. This area is significant for two reasons: it aligns with the top of its parallel channel and, more importantly, it marks the pivot from the previous all-time high. Drew pointed to a large red candle from that prior peak, suggesting that history may be about to repeat itself. When price previously approached a similar large red candle, it consolidated sideways for six trading days before attempting a breakout. Traders should watch for a similar pause, consolidation, or a slight pullback as gold confronts this major overhead supply.

Silver: In contrast to gold’s impending test of resistance, silver has flipped its script. After consolidating in the lower part of its range, it began a decisive push higher, closing comfortably above $80.00 at $81.20. The path of least resistance appears to be higher, with Drew reiterating a long-standing target zone derived from a measured move and the top of its parallel channel at $89.38.

US Oil: A potentially powerful bullish pattern is developing on the oil chart. After a steady decline, price is carving out a possible inverse head and shoulders pattern—a classic bottoming formation. The pattern consists of a left shoulder, a head, and a right shoulder. The key to unlocking its bullish potential is the "neckline," which in this case is a declining trendline. A breakout above this trendline, currently at $58.79, would trigger the pattern and project a target price of approximately $62.00.

Natural Gas: The selling pressure in Natural Gas has continued, but it is now approaching a major support zone. Drew identified the area between $3.30 down to $3.00 as a high-probability level for a significant bounce. For traders looking to enter, he suggested a scaling-in strategy: buying a partial position now, adding more at the parallel channel support, and adding a final piece if it briefly pierces the channel. This method allows a trader to build a full position with an average cost basis right around the key support level, positioning them perfectly for the anticipated bounce back toward the $3.70 consolidation area.

Conclusion: Navigating a Market of Extremes

Today's market action serves as a powerful reminder that the market is not a single entity but a collection of diverse and sometimes contradictory trends. While the parabolic rise in memory chip stocks captures the headlines, the subtle but significant technical breakdowns in mega-caps like Apple and Tesla tell an equally important story of capital rotation.

Across every asset class, from Bitcoin to gold to oil, well-defined technical patterns are providing a clear roadmap for what may come next. Whether it's an inverse head and shoulders in oil signaling a potential bottom, or a head and shoulders breakdown in Apple signaling a top, these formations give disciplined traders an edge. By identifying these key levels in advance, managing risk, and understanding the fundamental stories driving the price action, traders can confidently navigate this dynamic and exciting market environment.