SPX S&P 500 Daily Chart; H&S; Fibonacci Retracements; Tech Stocks Sell Off after KOSPI (South Korea) Crashes -10%

 

Don’t you love the smell of napalm in the morning? ApocalypseNow. Pull back your units boys, we’re gonna light it up like a birthday cake. You know, folks, some day this stock market is going to end. That chopper sound echoes in your mind.

The Monday session was interesting with stocks popping and running higher after the Juneteenth holiday weekend when the bruthas were beatin’ on those skins. Oil prices drop on better news from the Iran War and Strait of Hormuz but instead of stocks rallying on the prospect of lower gasoline and fuel costs, they rolled over and sold off.

The chips are down, literally and figuratively. The tech stocks are causing the weakness in the broad stock market and trouble started in Asia overnight. The KOSPI (South Korea) crashes -10%. The problem there is that Samsung and SK Hynix make up almost the entire index; only two stocks! In addition, Kospi just allowed leveraged ETF’s to trade and this attracts hot money including leveraged retail traders (Joe Sixpack). It was fun on the way up but now that tech appears extended, the downside can be ugly. The NIKK (Japan) dumps -3.6%

Maybe the AI bubble is popping like the dotcom bubble in 1999-2000? The SOX is down -6.3%. SMH -5.6%. XSD -5.1%. NVDA -2.6%. MRVL -7.3%. MU -10%. AMD -5.3%. CAT -4.5% (builds data centers). It is a tech bloodbath. IBM bucks the trend up +4% today. Favorite flavor SpaceX, SPCX, has crashed -34% in the last 4 days, after it printed the top, and the market makers are trying to hold the price at 150 and higher.

At the same time, Doctor Copper is puking on his shoes, so he is placed on a gurney and rolled into the emergency room to try and keep him breathing.

Adding more bad news on top of the pile of crony capitalism pig slop, the private credit problems continue due to their exposure to the software sector that is in the toilet bowl. Investors got into instruments for the long-term that place limits on withdraws. Now they want their money back faster because the markets look shaky but they cannot get the dough out fast enough. There is always some type of credit problem when a major stock market top occurs.

Technically, the above chart looks like a bowl of spaghetti. Price comes down to 7348 to test the 50-day MA support at 7340. The SPX has to make a bounce or die decision from here. The lower standard deviation band at 7299 is in play.

The blue lines show the Fibonacci retracements for the big rally that ran from April to the start of June. The 38% Fib retracement is 7121-ish and the 50% Fib is 6972.

The red lines show the H&S pattern in play. The 7621 is the head and the neckline is at 7370. That is a 251 point difference so subtracting that from the 7370 is 7119 a downside target if the 7370 gives way. You can also call the neckline at 73 hundo where that dip occurred a couple weeks ago. That targets 6979 if the 7300 fails. Thus, mathematicians say thus a lot, that is why pretty Emily, the office administrative assistant, did not invite Keystone to the weekend party, the H&S targets and Fib retracement targets gel together at the 6970-7120 area. That appears a logical downside target to look for in the near term. The 100-day MA is 7051 and it typically acts as strong support when equities begin falling apart.

The red lines for the chart indicators are sloping lower (weak and bleak) except for the histogram and stochastics, however, price has not made a matching low compared to two weeks ago so it is a moot point for now. The RSI dips its toe into bear territory at sub 50%. Watch to see if the stochastics do the same. The MACD and money flow clearly show that they want to see some lower lows in price ahead on the daily basis.

The day is young. Of course, watch the chip and tech stocks but also pay attention to copper and volatility. For the bears to begin carnage, they will need copper to remain weak and getting weaker and the VIX to run above 20 and higher. Pay attention to the banking sector and the impact of the ongoing private credit withdrawal drama. Last week it was Palisades Park and hugging and kissing the pretty girls in the Tunnel of Love, but this week it is the End of the World as we know it. Look at how fantastic and fun the world was without those garbage smartphones. I feel fine. Everybody sing. It’s the end of the world as we know it, and I feel fine. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 4:32 PM EST: The session ends with the SPX collapsing -1.4% to 7365. The LOD is 7347 and the 50-day MA is 7340. Price came down to within 7 points of testing the support at the 50-day. Since price is in the neighborhood, you would expect it to come down to kiss the 50 at 7340 to show it respect, and then make a bounce or die decision from 7340. The daily chart remains weak and bleak so a failure at the 50 would be expected. King Donnie Chumpski may cheerlead stocks overnight so that is always on the table. The SPX weekly chart is agreeable to lower lows on the weekly basis and key support is at the 20-wk MA at 7067 another critical support number that sits in that 6970-7120 target area if the wheels start falling off the wagon. Bears need the VIX above 20.68 if they want to create downside carnage to the 6970-7120 area. If stocks remain soggy and sell off, but the VIX remains below 20.68, the bears got nothing and stocks will recover and rally. If VIX pops above 21 and UTIL drops below 1116, stocks may crash. Bulls need stronger copper to stop the slide lower in equities. The NDX (Nazzy 100) plummets -3.3% today and the dirty SOX experiences a mini-crash off the bigtime top down -7.9%. MU and SNDK take the pipe each crashing more than -13%. Now the ball is handed back to Asia to see if they want to continue a cascading worldwide mini-crash in tech and AI-related stocks. All eyes will be on the KOSPI. CRBS collapses -9% in the afterhours trading that will be an ugly handoff to Asia. Let's call Oliver's Army to help us out.

Note Added Wednesday Afternoon, 6/24/26, at 1:30 PM EST: Whoopsies, daisies. The SPX drops to 7349 with the 50-day MA at 7349. The back kiss of the 200 EMA on the 60-minute at 7418 was successful for bears. Price came up and tested the 7418, and then fell apart. The S&P 500 is now at the 50-day MA at 7349 and must make a bounce or die decision from here. Things will get ugly if the 50 fails.

Note Added 4:39 PM EST: Whoopsies, daisies, it failed. The SPX falls through the 50-day MA support at 7349 to a LOD at 7336, but is goosed in the last 15 minutes by the market makers that do not want it to finish below the 50, and price ends at 7358. The drama will continue. MU pops +12% in the afterhours trading so chips will be pumped tomorrow and the SPX will likely float higher. Banks are happy after the crony stress test results are released and the banksters trip over each other to bump dividends higher. Copper weakness is a serious negative for the stock market that carries clout. VIX pops to 20.54 today only a dime away from creating major selling, but then it relaxes lower again, unwilling to leave its warm and cozy bull bed with an 18 handle. Utilities are pumped this week to help the bulls. The SPX may head higher again for another look at 7418 due to the Micron, chip, bankster and utility joy. Bulls win above 7418 and win big above the 20-day MA at 7473. Bears win big below 7349. Between 7350 and 7417 is noise. Price begins Thursday trading at 7358.

Note Added Friday Morning, 6/26/26, at 4:49 AM EST: The SPX pops higher yesterday to test the overhead resistance at 7418, and the bears spank it back down holding the resistance. Price then falls likely headed for the 50-day MA at 7357 and voila, the SPX falls to 7357, and then falls through to a LOD at 7323. The bulls kept battling and pushed price back above 7357 and that fight continues into the closing bell where the SPX ended at...... wait for it ...... no, you really should wait for it a bit longer ........ 7357. The S&P 500 is making a bounce or die decision at the 50. If the 7357 support fails, and then the low at 7323 is taken out, the downside target range of 6970-7120 is placed on the table. Bulls need to bust up through 7418 and then 7473 to start singing praises higher. The bulls want to sing Good News, Chariots A Comin', but the bears want the wheels to fall off the chariot. In the 1960's and 1970's, trickling into the early 1980's, the song was a standard in high school chorus class that was mandatory for all kids. It appears that schools only offer chorus class as an elective nowadays. Jackasses. It should be mandatory. Chorus class was not just about learning to sing. It teaches social skills. Everyone is embarrassed singing in front of their classmates and do not want to be made fun of, but what you find is that once the giggles stopped, it was fun to sing as one big uniform group, and it boosted everyone's confidence. Just another reason society is in the crapper nowadays. The exact kids that probably should be taking chorus class to boost their confidence and social interaction, are not. Parents, encourage your kids to take that elective chorus class especially if you have a shy introverted child.

Note Added Sunday, 6/28/26: The SPX ends last week at 7354 with the 50-day MA at 7363 acting as overhead resistance. Bulls need the SPX above 7363 pronto or they will fall apart. The drama continues.