The market regime has shifted to 'transition_bull_to_bear' (85% confidence), signaled by widening credit spreads and a 'sell the news' reaction to strong Tech earnings. SPY has broken below the critical confluence of its SMA20 and SMA50 (~$681.36), and the RSI failure below 50 confirms momentum has turned bearish. The divergence between falling equities and rising bond prices (TLT up) indicates a classic flight-to-safety dynamic.
The long-term AI investment cycle remains intact, evidenced by Google's massive $75B capex plan which supports the broader tech sector. We are only ~2.5% off all-time highs, and this pullback could be a standard technical retest of the breakout levels before the primary uptrend resumes.
The market regime has shifted to 'transition_bull_to_bear' (85% confidence), signaled by widening credit spreads and a 'sell the news' reaction to strong Tech earnings. SPY has broken below the critical confluence of its SMA20 and SMA50 (~$681.36), and the RSI failure below 50 confirms momentum has turned bearish. The divergence between falling equities and rising bond prices (TLT up) indicates a classic flight-to-safety dynamic.
The market regime has shifted to 'transition_bull_to_bear' (85% confidence), signaled by widening credit spreads and a 'sell the news' reaction to strong Tech earnings. SPY has broken below the critical confluence of its SMA20 and SMA50 (~$681.36), and the RSI failure below 50 confirms momentum has turned bearish. The divergence between falling equities and rising bond prices (TLT up) indicates a classic flight-to-safety dynamic.
SPY is presenting a classic 'buy the dip' setup at the 50-day SMA ($681.36) and major structural support ($675.81). The fundamental engine remains intact, driven by Alphabet's $75B AI capex commitment which directly benefits the index's heaviest weightings (NVDA, MSFT). With RSI resetting to 41 (oversold territory in uptrends) and price sitting atop a low-volume node, a mean-reversion bounce toward the volume Point of Control ($689) is the path of least resistance.
Thesis Competition: BEAR case won (75% vs 65%).