S&P 500 Holds Support as AI Spending and Oil Keep Market Risk Elevated

The S&P 500 Index (SPX) is slightly lower after Thursday’s sharp selloff, while futures are pointing to a mostly flat open. The Nasdaq 100 Index (NDX) and the Invesco QQQ Trust (QQQ) are under slightly more pressure as the market tries to digest strong earnings alongside growing concerns about capital spending, inflation, and the substantial amount of money being committed to artificial intelligence.

The main S&P 500 setup remains the major trend line connecting the 2021 bull market high with a later major high. Price has tested that line twice and bounced both times. Another selloff today or early next week would create a third test within roughly a month and a half, and repeated tests tend to weaken support.

The current structure still resembles a bull flag, so it remains constructive as long as the price holds above that trend line. A break below it would create a failed bullish breakout and significantly increase the downside risk. On the other hand, if oil begins to fall more sharply and the market produces a strong rally, a break above the trend line near 75.50 could lead to another leg higher.

The U.S. Dollar Index (DXY) is fractionally higher, with resistance near 101.70. The U.S. 10 Year Treasury Yield (US10Y) is pulling back slightly as oil declines, but oil is only one reason yields remain elevated. U.S. debt is approaching $40 trillion, deficits continue to expand, and companies are taking on more debt to finance massive artificial intelligence investments.

Artificial intelligence spending is also contributing to inflation beyond food and energy. There is an increasing demand for chips, computers, electricity, water, and data center infrastructure. Since nearly every modern product contains some type of chip, those higher costs can spread throughout the economy.

I would not expect yields to fall substantially just because oil comes down. A much larger decline would probably require a recession, weaker consumer demand, and a slowdown in artificial intelligence spending.

The U.S. Dollar to Japanese Yen exchange rate (USDJPY) is another risk to keep in view. The yen continues to weaken against the dollar, increasing the possibility of intervention from Japanese authorities. During a previous intervention, the Nasdaq fell 15% in two weeks. It has not happened yet, but continued yen weakness raises the risk of disruption.

West Texas Intermediate Crude Oil (WTI) is down about 2.7% after reaching major technical resistance. Oil completed a precise 50% retracement of the decline from $120 to $67 while also touching a descending trend line from the March 9 high.

The initial short began between $87 and $88 per barrel. More was added above $92, bringing the average price to approximately $90. The position is now slightly profitable, and the expectation remains for oil to pull back toward approximately $80 within one or two weeks. Weekend headlines still matter because any signs of further escalation could quickly change that setup.

Spot Gold (XAUUSD) is flat after Thursday’s significant decline and remains trapped inside a tightening wedge. A confirmed breakout would support a long position. A breakdown would shift attention toward the $3,500 to $3,600 area as a more attractive buying zone, although a small position could be considered before the price reaches that range.

Spot Silver (XAGUSD) is flat to slightly positive, with resistance between $63 and $64 and support near $54. Two trend lines are converging around $63 to $64 in approximately two weeks, which increases the likelihood of a decisive move.

Natural Gas Futures (NG) continue to hold technical support and are attracting modest buying interest. The near term setup is only slightly bullish, but the longer-term view remains stronger because data centers may increasingly need dedicated natural gas power outside the traditional electrical grid.

Intel Corporation (INTC) reported an exceptional quarter and initially surged as high as $113.75, but it gave back most of the move and was up only about 2% during the morning session. That reaction shows how sentiment has changed. Strong earnings are no longer enough when management also announces substantially higher spending.

Across the industry, companies are committing between $100 billion and $200 billion annually to artificial intelligence and infrastructure. Combined spending reaches into the trillions. Some companies will generate strong returns from those investments, while others will be left carrying the cost.

Intel does not currently have enough volatility to create a strong setup. A decline toward the $89 pivot low could produce a day trade opportunity, but with the stock moving only about 2%, reaching that level during the session appears unlikely.

Micron Technology, Inc. (MU) is also lower after remaining relatively resilient during Thursday’s selloff, which suggests that weakness may be spreading across semiconductor names.

Oracle Corporation (ORCL) is up only 1.5% to 2% after initially rising on a $7 billion government contract. The contract is small relative to Oracle’s overall business, but it may give the company a foothold for deeper government involvement. Oracle traded near $400 not long ago and around $350 in 2025, but it is now near $120. The larger opportunity may depend on whether this contract develops into a broader relationship.

Microsoft Corporation (MSFT), Meta Platforms, Inc. (META), and Apple Inc. (AAPL) report next week, alongside the Federal Reserve decision and additional economic data. That combination will make next week much more important for the broader market.

American Express Company (AXP) is lower following earnings, and its results point to growing pressure on consumers. Fees from accumulated credit card debt are becoming a larger profit driver than actual card spending. That is notable because American Express customers generally have higher incomes than customers at many competing card issuers. The stock has already tested its first support area near a previous pivot high and gap fill. The next important day trade level is approximately $318 and change.

Bitcoin (BTC) is declining for a third consecutive day after testing the 67 level. If it cannot move above that resistance, attention shifts back toward $58,000. A move into that support would increase the risk of a larger technical breakdown.

The market remains technically constructive, but the margin for error is narrowing. The S&P 500 needs to hold its major trend line, Bitcoin needs to clear resistance, and technology companies need to prove that enormous spending commitments can eventually produce returns. Until those questions are resolved, patience and disciplined entries matter more than chasing the story.