SPX Faces Critical Support Level Amid A.I., Crypto Deleveraging

Market Overview - The S&P 500 has experienced a fourth consecutive day of losses, indicating a bearish trend in the market [1][2] - Defensive trades are becoming more prominent, with utilities and consumer staples showing some resilience [3][4] Technical Analysis - The S&P 500 has broken below the 6,600 level, with a potential drop to 6,550 being a critical support area [5][6] - A bearish cross has been observed on the S&P 500 weekly chart, suggesting further downside potential [5][6] Sector Performance - Utilities have shown some positive performance, although they have recently turned negative; they remain a favored sector for investors seeking safety [3][20] - Traditional utility companies are becoming more attractive as interest rates decline, leading to increased inflows into this sector [21][22] Employment Data - The ADP report indicated a loss of 2,500 jobs, but hiring activity is reportedly increasing in the leisure and hospitality sectors [15][18] - Initial jobless claims were reported at 232,000, aligning closely with the four-week moving average, while continuing claims rose slightly to 1.95 million [17][18] Cryptocurrency Insights - Bitcoin futures have crossed below the 90,000 level, with discussions around potential deleveraging in the market [9][10] - The next major support level for Bitcoin is at 80,000, with bearish indicators present on the weekly chart [12][13]