Veteran technical analyst spots key stock market signal

Core Viewpoint - Technical analyst Helene Meisler has observed a potential increase in stock market volatility in early 2026, indicating that stocks may face significant headwinds despite recent bullish trends [3][4]. Group 1: Market Trends - The stock market has experienced a strong rally since the 2022 bear market, achieving three consecutive double-digit annual returns, including a 16.4% gain in 2025 [4]. - Wall Street's optimism for 2026 is based on the assumption that the bullish conditions of 2025 will continue, which may not hold true [5]. Group 2: Economic Indicators - The Federal Reserve has cut its Fed Funds Rate by 0.75% by the end of 2025, which is expected to lower borrowing costs across various sectors [6]. - Major cloud data center players, including Amazon and Alphabet, are projected to increase their AI spending to $527 billion in 2026, up from $394 billion in 2025 [6]. - Corporate profits have surged, with an estimated growth of 12.4% in 2025 and an expected 14.9% growth in 2026 according to Wall Street [6].