Is This The Stock Market Crash We Were Waiting For?
In a Nutshell
Markets are down 1.3% ahead of PCE and GDP, with Google missing earnings and dropping 10% while ServiceNow fell 16-18% into bear market territory. Meta is down 22% from highs, confirming multiple tech names have entered bear market conditions on AI investment concerns. Tomorrow's GDP (3.2% expected) and PCE data will determine if this is the start of a technical recession, with traders advised to size positions based on their individual AI bubble thesis rather than chase dips.
These notes were generated by AI and may contain inaccuracies.
NASDAQ is currently down 1.3% before the PCE and GDP reports are released. Google reported earnings with a significant miss, resulting in a 10% drop. The company has a $3.97 trillion market cap, down from its previous $4 trillion level. After the sell-off, the market cap sits at approximately $3.5 trillion following a 100% rally. The decision to buy the dip depends on whether investors believe the AI bubble will pop. Those who expect the bullish direction to continue must decide their position based on their own analysis and risk tolerance.
Trades were executed after the earnings reports were released, not before. Google (Alphabet) and Microsoft earnings were both traded live. An overbought reversal setup resulted in a small short position on Google, generating $725 in profit. ServiceNow trades involved multiple dip purchases and rip sales, with a $2,000 position fully closed. Oracle trades produced a $974 move, though the short position was closed earlier than optimal. From Oracle's overall highs to lows, there was approximately a 6% move.
Microsoft reported strong earnings, beating expectations on both EPS and revenue across all metrics. Google missed on both EPS and revenue. Google stated they expect to maintain their 2026 capex spend at $205 billion and plan to increase spending further in 2027. This indicates they are not reducing investment despite the earnings miss.
ServiceNow is down 16% during market hours and 18% after hours due to concerns over slowing subscription growth and forward guidance. This has placed the stock in bear market territory.
Tech stocks are being described as entering bear market territory in stealth mode. Meta is down 22% from recent all-time highs, meeting the 20% retracement threshold that defines bear market territory. Meta's price action shows a pattern from highs of 780 down to current lows representing a 22% decline. Historical support levels for Meta are around 550, with resistance around 675.
Position sizing should reflect the confidence level in one's thesis. Investors must decide whether concerns about AI overinvestment are valid. Those who do not see AI investment as a concern may view current levels as dip-buying opportunities. Those who believe the AI bubble will pop should consider being more cautious. No external advice should override individual analysis of both positive and negative factors.
Marvell Technologies (MRVL) is down 8.66% following reports of a potential acquisition of Lumentum (LITE) to combine chip business with an AI networking optical supplier. Lumentum's laser capacity is reportedly sold out through 2029.
The FOMC rate decision and press conference occurred today. Tomorrow's key releases include the PCE report, which is the Federal Reserve's preferred inflation measure, and the GDP report. GDP expectations are set at 3.2%. The question remains whether this will be the first quarter of negative GDP, indicating a technical recession. The economic calendar is available at learnplanprofit.com.
Live trading sessions occur every morning at market open for 30 minutes to one hour. Access includes the LPP lesson library and Discord community. The program is designed for beginners, with pricing at less than $1.30 per day during the current sale.
Do not use margin or leverage. Avoid overexposure. Smaller positions that can tolerate volatility are preferable to larger positions that cannot handle market swings. The goal is to end the year on a positive note.
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