2026-02-18 06:57:00
The showing yesterday was a bit of a mixed one but it continues to highlight some resilience in dip buying in US equities for now. That despite all the concerns on the AI trade and software stocks in the past two weeks. The S&P 500 was down as much as 1% overnight but rallied in the end to close marginally higher by 0.1%.
This was the closing performance breakdown of the stocks in the index yesterday:
Financials held up modestly while in tech, the rebound was mostly led by Apple with a modest recovery in Nvidia shares as well.
But when you zoom out to the bigger picture, it seems to be a case of bend but don’t break for the S&P 500.
S&P 500 index daily chart
Despite all the trials and tribulations in the past two weeks, we’re still just under 3% from a fresh record high in the index. And that is quite remarkable, if you really want to think about it. I mean it is clear that sentiment remains rather rocky and shaky at the moment, yet we’re just one or two good days from setting new highs in US stocks. Wild.
The chart above highlights that the ceiling remains closer to 7,000 for now but the key detail is where the floor level is at.
And that is the 100-day moving average (red line), seen around 6,814 currently. The drop early yesterday threatened to take out the key level, one that has held for nine months now. The last time the S&P 500 traded below either of its key daily moving averages was all the way back in early May last year.
So, that speaks to the kind of upside and bullish momentum that we’ve been riding until today. We’ve had a couple of tests of the key level since November last year, but in both times dip buyers have managed to hold the line. And in trading this week, that seems to be the case as well in the first few attempts.
That being said, it’s critical to continue to keep an eye out on the 100-day moving average level above. A firm break of that will mark a significant momentum shift in US equities, even if we already gotten such a break in the Nasdaq earlier this month. The one for the S&P 500 will be a key power shift in the price action battle, one that could start up some heavier selling as we look to the months ahead. That especially considering markets are also pondering a bigger shift in tech valuations and the AI outlook.
