Stock Market & Crypto Analysis for Week Ending September 26, 2025

Key Concepts

• Moving Averages: Technical indicators used to smooth out price data and identify trends. The video discusses the 5-day, 20-day, and 50-day moving averages.
• Anchors: Specific price levels that act as significant support or resistance, often derived from previous highs, lows, or significant events (e.g., Fed rate cuts, elections).
• Volume Weighted Average Price (VWAP): An average price weighted by volume, indicating the average price at which a security has traded throughout the day.
• Pullback: A temporary decline in the price of an asset after a period of upward movement.
• Bounce Trade: A trading strategy that aims to profit from a temporary upward movement in a declining asset.
• Primary Trend: The overall direction of the market over a longer period.
• Shakeout: A rapid decline in price designed to scare out weaker investors before a potential rebound.
• Adam's Pitchfork: A technical analysis tool used to identify potential price channels and trendlines.
• Buy the Rumor, Sell the News: A trading phenomenon where an asset's price rises in anticipation of a positive event and then falls after the event occurs.

Market Overview and Volatility

The week ending September 26th was characterized by significant market volatility, though major indices like the S&P 500, NASDAQ, and Russell 2000 ended with minimal losses. Semiconductors continued to be the strongest performing sector, showing a 2% gain for the week and a year-to-date increase of 33%. In contrast, Ethereum experienced a 10% decline for the week.

Technical Analysis of Key Markets

Equities

S&P 500:

• The S&P 500 pulled back to a key support level, coinciding with the 20-day moving average, the month-to-date anchor, and the anchor off the most recent relevant higher low on the daily timeframe.
• The 20-day moving average is rising and above the 50-day moving average, suggesting that pullbacks are likely to lead to higher prices.
• However, the market is currently below a declining 5-day moving average. If the market rallies, it's expected to encounter resistance at the 5-day moving average before potentially continuing higher.
• A break below the volume-weighted average price (VWAP) from yesterday's low, with the price getting stuck below the 5-day moving average, could lead to another test of the 20-day moving average and the September low anchor, potentially signaling deeper selling.
• The current situation is described as "no man's land" until further price discovery. A bounce and bid would favor long swing trades, while a break down would favor short day trades against the primary daily trend.

NASDAQ:

• The NASDAQ remains below its declining 5-day moving average.
• The daily timeframe still shows a strong market, suggesting the recent pullback might be short-term.
• On the 30-minute timeframe, a rally through the 5-day moving average and a subsequent bid after a pullback would indicate a continuation towards all-time highs.
• The benefit of the doubt on the longer-term daily timeframe is given to buyers.

Russell 2000:

• The Russell 2000 experienced weaker performance this week.
• It is trading below the anchor level from the Federal Reserve's rate cut.
• A rally to this level and subsequent rejection would send a strong bearish signal for the Russell 2000.
• A potential bullish scenario involves a pullback towards an anchor off a recent low, followed by a recovery, which could lead to new all-time highs.
• However, breakouts from extended levels are often met with profit-taking, especially after news like a Fed rate cut ("buy the rumor, sell the news").

Semiconductors:

• This sector is identified as the strongest performer.
• Semiconductors are holding above the anchor from the Fed and the anchor from the all-time high.
• The group has shown higher lows and a higher high after a quick shakeout, indicating buyers are in control.
• For intermediate-term traders, a stop loss below the recent low is recommended for risk management.

Cryptocurrencies

Bitcoin:

• Bitcoin is testing an anchor from the April low and has not yet shown a significant bounce.
• A potential bullish scenario involves a slight undercut of the current low, followed by a rally towards the anchor from the all-time high.

Ethereum:

• Ethereum bounced from an anchor off the handoff from the April low.
• The target for a potential rally is between 4350 and 4400, aiming for the anchor from the all-time high.
• A break below the current low would invalidate the bounce trade and lead to exiting the position.

Solana:

• Solana was purchased around 195.
• The trader had hoped for a further decline into a zone defined by an anchor off a recent low and an orange line from an election period.

Bonds

• Bonds are digesting a sell-off that occurred after the Fed cut rates.
• Despite the Fed cutting rates (which typically leads to higher bond prices), bond prices have been falling, meaning the 10-year yield has increased from 4.04% to 4.190%. This is attributed to a "buy the rumor, sell the news" dynamic.
• The 5-day moving average is flattening, and the 20-day moving average is rising above the 50-day moving average, while the 200-day moving average is still declining.
• This setup suggests that if the market consolidates, the 5-day moving average will start rising, giving the benefit of the doubt to buyers.
• The current consolidation above the 5-day moving average is seen as a good entry point for buying bonds.
• The chart pattern on a shorter timeframe is being analyzed for potential head and shoulders formations.
• The current technical setup for bonds, with a rising 20-day moving average above a rising 50-day moving average and a flattening 200-day moving average, is the most favorable it has been in a while, reminiscent of a previous period that led to a significant rally.

Biotech Stocks

• Biotech stocks have been performing well, riding the upper range of an Adam's Pitchfork.
• The weekly chart indicates significant upside potential, with new all-time highs approximately 70% higher.
• An intermediate-term target is around 105, which could lead to a breakout similar to the Russell 2000, potentially followed by consolidation and a higher low before further recovery.
• The biotech index itself is considered too choppy for individual investment, and exposure is recommended through individual names.

Key Arguments and Perspectives

• Trend Following: The primary trend on the daily timeframe is considered higher, and any short trades should be against this trend and not held overnight.
• Benefit of the Doubt: On longer timeframes, the benefit of the doubt is given to the prevailing trend (buyers in the case of the S&P 500 daily chart).
• Risk Management: Specific stop-loss levels are suggested for various assets to manage risk, often placed just ahead of key support levels or recent lows.
• Market Psychology: The "buy the rumor, sell the news" phenomenon is highlighted as a significant factor influencing price action, particularly around Federal Reserve announcements.
• Importance of Anchors: Specific price levels, termed "anchors," are crucial for identifying potential support and resistance zones.

Notable Quotes

• "When we're below a declining five-day moving average, we have red basically saying that uh we want to wait for the market to prove itself before we get aggressively buying in these particular markets."
• "The bottom line is it's kind of in no man's land here a little bit until we get some further price discovery and the market tells us what it wants to do."
• "And always remember that the higher time frame is where you put the benefit of the doubt."
• "So, a little bit of buy the rumor, sell the news."
• "When interest rates go lower, bonds go up. But what's happening? bonds are going lower, meaning the 10-year yield from that rate cut right here."

Conclusion

The market remains in a state of flux, with volatility present but major indices showing resilience. Semiconductors are leading the pack, while cryptocurrencies like Ethereum are experiencing pullbacks. Equities are at critical junctures, with the S&P 500 testing key support levels and the NASDAQ showing strength on longer timeframes. The Russell 2000 faces resistance at important levels. Bonds are showing signs of a potential bottoming formation, presenting an attractive opportunity for buyers. Biotech stocks have significant upside potential, though individual names are preferred over the broader index. The overarching theme is to remain patient, observe price action, and adhere to risk management principles, especially when navigating uncertain market conditions.