While the financial world waits for NVDA earnings and watches a correction in many of the MAG 7 and other related tech stocks, a lot of noise erupts.

The biggest noise is whether this is the top.

Those of you who are familiar with our work at MarketGauge.com know that we use risk gauges to help us differentiate between a correction and major sell-off.

Looking at the NASDAQ chart through QQQ, the price broke below the fast-moving average.

However, it remains well above the 50-DMA and the January 6-month calendar range high.

Real motion or the momentum indicator shows a decline with momentum with a bearish divergence to price.

NASDAQ now underperforms SPY.

This leaves a mixed technical picture.

Looking just at the price we must go with correction.

NVDA could easily reverse this path with a beat and a huge spike higher.

Or not.

However, we do have some pause here, considering the weaker momentum and lack of leadership.

Of course, this could be a rotation. However, none of the major indices or sectors performed well EXCEPT…

Junk bonds or high yield, high debt bonds closed green.

In the chart, the price shows it scraping against the 50-DMA.

To get more bullish or see more of a risk on environment, the price should clear back over the 50-DMA.

Momentum is flat to price, both just under the 50-DMA.

The important part of this chart is Leadership.

With HYG outperforming TLT or the long bonds, we can safely say the market remains risk on.

Should that change, then we expect a much deeper correction.

However, should HYG hold up and better still, clear over the 50-DMA, then most likely, ahead of NVDA, the market is giving traders an opportunity to buy the best stocks a bit cheaper.

ETF Summary

S&P 500 (SPY) 500 now the pivotal point-490 near-term support

Russell 2000 (IWM) 195 support

Dow (DIA) 385 pivotal

Nasdaq (QQQ) 430 pivotal

Regional banks (KRE) Back to the 45-50 range

Semiconductors (SMH) 200 pivotal

Transportation (IYT) 266 support.

Biotechnology (IBB) 135 pivotal

Retail (XRT) The Jan calendar range high at 73 now must hold

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