Stocks had a boring day on the surface; beneath, a rotating undercurrent seemed to be concentrated towards the commodity side of things. Overall, declining stocks led advancers, resulting in the number of stocks above their 50-day moving average in the S&P 500 to slip and put downward pressure on the equal weight RSP ETF.

Equal Weight S&P 500 (RSP)

The RSP made a new high last week, but I still consider it range-bound. I have often seen stocks or indexes break to new highs and then a few days later break the other way. I still tend to think the RSP is in a precarious position, with a big uptrend in play. Plus, it looks like the MACD has or is close to an apex here and ready to turn lower.

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S&P 500

Meanwhile, the tranquility of the past few days is about to end, I think. There is a rising wedge pattern that has formed in the S&P 500 cash and futures market. Additionally, this appears to be the end of a Wave 5 higher, equal to 78% of Wave 3. Once the futures break below 4400, we should confirm that wave 5 is complete and a corrective wave is coming.

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Oil was down sharply today, falling to $66.75 by day’s end. It was as low as $65.10-ish, testing a low from previous days. While a double bottom may be in place, I think it is unlikely. Oil hasn’t even hit oversold levels yet, and I expect the dollar to strengthen further. So, could we see a pause in the sell-off? Yes. Is it the end of the move lower? Probably not.

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Nvidia (NVDA)

If you are an Nvidia bull, then you better hope the stock rallies over $210 very soon. If it doesn’t and starts making its way towards $180, the odds of a double-top pattern will increase dramatically, which will signal a much steeper decline is coming.

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Apple (AAPL)

Apple has a triangle pattern forming, too; I don’t think it is a bullish pattern. Apple already broke the downtrend, and we know that when the RSI gets above 80, the stock tends to not do well in the weeks that follow. A break below $145 will be a real negative for the shares, with the trendline at $130 the next likely stop.

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Moderna (MRNA)

Moderna appears to be in the middle of a giant gamma squeeze. We can tell because call option volume and implied volatility have exploded higher, while skew has collapsed. This means this the run higher is like playing with fire.

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