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Today’s hefty bounce aside, I came back from some time away to a market I didn’t particularly want to see. Not because I can’t trade it — but because what’s happening right now isn’t some quick shakeout that resolves in a few sessions.
The breakdown has been clear and deliberate, not chaotic or confusing, and the selling pressure has been straightforward in a way that tells you exactly where this market wants to go.
We’re watching something much more significant unfold across multiple indices simultaneously, and if you’re not paying attention to what that means, you’re missing the signal entirely.
And just because the market is bouncing hard today, that doesn’t mean we’re suddenly out of the woods and everything is all clear…
When Everything Breaks at Once
The VanEck Semiconductor ETF (SMH) broke below its 200-day moving average (MA). It didn’t just dip — it finally gave in with a clean break to the downside, and of all the charts out there, it’s showing some of the strongest potential for further continuation.
The Dow broke down as well. The Russell 2000 also fell apart. And here’s the part that should get your attention: Invesco S&P 500 Equal-Weight ETF (RSP) also broke below its 200-day MA.
Think about what that represents. You’ve got risk assets like SMH cracking. You’ve got the Dow — which is supposed to be the more conservative “old economy” benchmark — breaking down. And then you’ve got RSP failing, which tells you this isn’t just mega-cap concentration masking underlying weakness.
This is broad-based deterioration happening across the entire market spectrum. Risk assets, conservative holdings, small caps and equal-weighted exposure — they’re all telling you the same story at the same time. And the direction is unmistakably lower.
This Isn’t a 1-Week Dip
The selling has been extremely clear since the market moved past the recent chop. There hasn’t been confusion or mixed signals — the trend has been pointing down with conviction.
Even intraday action reflects how sensitive the market has become. A single geopolitical headline — like a tweet confirming escalating tensions overseas — was enough to erase a potential stabilization attempt and push prices straight back into weakness.
Here’s the distinction that matters: This is looking like we’re turning into a more extended bear market, not just a brief week below the 200-day MA. It’s looking like it could extend out for a couple months. When you see synchronized breakdowns across multiple indices — especially when those indices represent different market segments and risk profiles — you’re not looking at a temporary pullback.
You’re looking at a shift in market structure that takes time to resolve.
The simultaneous failure of both aggressive growth plays and defensive allocations isn’t something that fixes itself in a handful of sessions. It’s a warning that the environment has fundamentally changed, and positioning needs to reflect that reality.
I don’t say this to be dramatic. I say it because the charts are showing coordinated weakness across every major representation of the market — and when the data lines up like this, ignoring it is how accounts get wrecked along with confidence.
Kane Shieh
Kane Shieh Trading
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
P.S. Volatility Just Flashed a Rare Signal
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