The S&P 500 Is Barely Holding Onto Technical Chart Support

In the last week, the S&P 500 fell sharply. Mega cap tech earnings were disappointing and valuation concerns began to pop up. Names like Apple, Nvidia, Microsoft and Alphabet all fell sharply.

From a technical analysis point of view, the S&P hit key support on Thursday and was about to bounce on Friday. This held the bullish narrative in place, though barely. The key trend line seen in the chart above should be watched by every investor. Should it break and confirm, the potential for a bear market (20% decline or greater) is high.

With mega tech earnings from Apple, Microsoft, Meta and Amazon.com set to report in the coming days, the potential for a free fall break of support increasing.

Investors need to remain nimble, the economy appears to be slowing more rapidly as Federal Reserve chairman Jerome Powell is seems more concerned. While rate cuts are likely coming in September, historically rate cuts coincide with a sharp market decline.

Be nimble and cautious, my friends.