In recent days, the S&P 500 (SPX) Index has been pressured by growing concerns about the Federal Reserve's (Fed) interest rate trajectory. Following the prolonged US government shutdown and a lack of official economic data, the market has been plagued by uncertainty regarding the regulator's next move. This has triggered a wave of profit-taking, primarily affecting the technology sector, particularly vulnerable under current conditions.
The situation is exacerbated by data from the consumer sector, with major retailers reporting a slowdown in demand. According to private research, middle- and low-income customers continue to reduce their spending. This is a cause for concern, as this indicator is a key driver of the US economy. Against this backdrop, high-risk companies appear to be on thin ice.
The tech sector is under additional pressure due to a reassessment of the outlook for AI-related firms. Investors are now paying more attention to the actual financial returns from investments in artificial intelligence, which is leading to corrections in popular stocks. The weakening position of leaders like NVIDIA is undermining market confidence in the sector's sustainability.
From a technical perspective, the market is currently attempting to recover, but its prospects look doubtful. Technical indicators confirm this skepticism. The Stochastic Indicator is currently exiting overbought territory, creating a divergence with the SPX price. Meanwhile, the Chaikin Oscillator is signaling a lack of significant buying volume. This shows that the current upward movement is rather weak and buyers are not active enough.
This week's major event will be the publication of NVIDIA's financial results. Although positive news could trigger a short-term rally, investors are likely to use it as an opportunity to take profits.
Consider the following trading strategy:
Sell SPX during a rebound from the $6,800 level ahead of NVIDIA’s report. Take profit: $6,640. Stop loss: $6,920.
This forecast remains relevant between November 17 and November 24, 2025.
This content is for informational purposes only and is not intended to be investing advice.
