Semiconductor Weakness Leads as Earnings and Fed Risk Build

The S&P 500 Index (SPX) finished nearly flat, but the session was weaker than the close suggests. The SPDR S&P 500 ETF Trust (SPY) tested a declining trend line early, then sold off through most of the day before a late bounce. Price is still below that trend line, and three straight closes are sitting almost directly in line. That keeps downside risk active, with support at $733.28 along the rising trend line that has already protected the price twice.

This is also a heavy week for the market. Apple Inc. (AAPL), Microsoft Corporation (MSFT), Meta Platforms, Inc. (META), Robinhood Markets, Inc. (HOOD), and Arm Holdings plc (ARM) all have earnings coming up, while the Federal Open Market Committee decision arrives Wednesday afternoon. Adding renewed tension in the Middle East, it makes sense that investors are reducing risk ahead of the major announcements.

The Invesco QQQ Trust (QQQ) has confirmed its break below trend line support. That broken level becomes resistance at $695.64, while downside support remains at $674.90.

The bigger warning is the VanEck Semiconductor ETF (SMH), which fell 2.25%. It is sitting on the upper boundary of the rising parallel channel that has held since the Liberation Day low. If that breaks, the next support is near the 50% area of the older channel at $508.20. The broader $500 area needs to hold if bulls want another move higher. Near term resistance is $578.24.

The CBOE 10-Year Treasury Note Yield Index (TNX) pulled back along with oil, but stocks did not rally because the uncertainty remains. Current probabilities show as high as a 60% chance that rates stay unchanged and a 37% chance of a rate increase at this meeting. If rates are not raised now, the chance of an increase in September remains high. With no Federal Reserve meeting in August, Kevin Warsh’s message on future cuts or increases will matter as much as the decision.

Gold Futures (GC) are still pressing against a declining trend line. The first upside level is $4,096, with support at $3,886. Silver Futures (SI) have already broken above their declining trend line, retested the breakout, and moved higher again. Resistance is $63.26. Silver could still pull back below $50 and test the rising trend line at $49.71.

West Texas Intermediate Crude Oil Futures (CL) dropped 9.52% and moved into support between $81.33 and $80. That area may create a temporary bounce. If tension in the Middle East escalates, resistance is $87.07, followed by $96.44.

Henry Hub Natural Gas Futures (NG) failed to confirm a breakout and slipped back into the prior range. Support is $2.75. A break below it could expose $2.53. Bulls need to defend $2.75, then reclaim $2.9068.

The memory chip space came under pressure after CXMT Corporation (CXMT) surged 466% to 500% during its China initial public offering. Sandisk Corporation (SNDK) had the sharper decline, while Micron Technology, Inc. (MU) also fell but recovered more strongly from its low. The concern is that a new DRAM competitor is entering a business where margins have exceeded 80%. Even margins near 50% would attract more competition and pressure memory companies tied to artificial intelligence and data center spending.

Oracle Corporation (ORCL) gained 4.27% and closed above support at $118.86. If that holds, the price could challenge $143. If it fails, the next possible support is $103.82. Atlassian Corporation (TEAM) gained more than 10% and is again testing the 50% area of its declining parallel channel. Repeated attempts are increasing the probability of a breakout, with resistance at $120.09. Earnings are scheduled for August 6.

Workday, Inc. (WDAY) also gained 10% and is making higher lows. Resistance is $158.66, followed by $173.58. Bulls need to protect the rising trend line at $135.03 before earnings on August 20. NVIDIA Corporation (NVDA) fell nearly 5% after a bullish consolidation failed. Support is $191.88, followed by $179.74.

Advanced Micro Devices, Inc. (AMD) fell 5.17% and confirmed another breakdown from its parallel channel. Resistance is $544.23, with support at $447.37. Lumentum Holdings Inc. (LITE) is testing the lower boundary of its parallel channel for the fourth time. That creates a 50% to 50% chance of a breakdown. If selling continues, the next support is $616.99.

Bitcoin (BTC) remains inside its parallel structure, but it needs to close above $64,536 to keep that setup intact. Upside resistance remains at $67,264.

The main message is simple: semiconductor weakness is the biggest internal warning, earnings and the Federal Reserve are keeping risk tight, and several major assets are sitting directly on support. This is a market where patience and price discipline matter more than trying to predict the next headline.