Growth at Low Tide This Morning

On the back of some visible Nasdaq names like ROKU and TSLA trading lower due to their own company-specific issues, tech as a whole is taking it on the chin this morning, namely the software growth stocks. 

It may very well prove to be merely a shakeout, but as we are seeing those shakeouts can be rather convincing. And, of course, there is always the distinct possibility that the selling in growth is the start of a more defensive phase for the market as we are now not too far off from the next earnings season as well as the "Sell in May and Go Away" mantra. 

As I discussed with Members in my full video recap last evening, in these situations it is typically instructive to have tangible price areas in mind, rather than solely relying on gauging social media sentiment, for example, or applying a given macro thesis to short-term market movements. 

And when we do that, we return to a QQQ look we observed yesterday afternoon. On the hourly chart, below, of the top-weighted stocks in the Nasdaq Composite Index, unless and until sellers crack and hold us back below $182.80 it is tough to embrace a bear thesis on tech beyond these spurts of weakness intraday. From a swing perspective, bears simply must accelerate lower and then convert yesterday morning's breakout area back into resistance. 

Otherwise, I view this type of action as chop seemingly designed to shake out weak hands in growth names like TWLO before they resume higher yet.