Stock Market & Crypto Analysis for Week Ending 6/5/26

[00:00:00] Speaker 1: Hey everybody, it's Brian Shannon from Alphatrends.net. Today is Friday, the 5th of June, 2026, and we had a down week this week. We broke that trend that we've seen, but still very positive year to date in these equities. The semis, they lost 5% this week. It felt bad maybe, but we're still at 58%. So let's take a look at these charts and make some sense of it. We'll of course look at Bitcoin as well, which got throttled pretty good. In fact, let's just start out there, not because it's my main concern, but I'll forget otherwise to switch over to trading view. This is the daily chart on the left, and this is the anchored volume weighted average price that we had seen find buyers earlier in this year when it made that what was the year to date low. That is from the beginning of the move in 2023. Now you can see we're underneath that. As I mentioned Monday morning, I had purchased the Bitcoin looking for a bounce in that zone once again, purchased it right around in this area, and my stop was underneath this low, and I am out of this. I have no interest in Bitcoin. I have no interest in Ethereum, which is breaking to a new year low as well. I have no interest in any of these cryptos. They are all in terrible downtrends, and they've broken what had the potential to become a place of support. So they're broken. They're going to need to heal. Now, on to more important things. Equities here. The warning signs were here this week. In fact, I posted this on Wednesday morning to Twitter, saying that our job is to listen to the message of the market. That never changes. We've spoken week after week about how it doesn't end poorly unless you don't have a plan. So if you didn't have a plan with stops, then maybe today felt worse than it should have been. But this week, I saw that more of our stocks were getting hit on stops recently. Fewer quality setups were presenting themselves. And that left us in a larger cash position, which is where you want to be when this market rolls over, at least in the short term. There's no sign that this is the top. I have no interest in trying to be the person who calls that. But we did break an important trend line. We broke the 20-day moving average. So people who buy the dip to the 20-day moving average bought it at 746 and might be wondering what went wrong. And I'll tell you what went wrong is you don't buy when we're below declining 5-day moving average. To me, that is a cardinal sin that I will not do. So, you know, you look at the prior pullback over here. Sure, you could have got a better price by buying below the 5-day moving average. But if you waited for a higher high above that flat to rising 5-day moving average right here and then exited over here, well, you're in a much better position than just trying to guess the bottom. So people who bought what was to be supported at the 20-day moving average are now down close to 9 points here. Now, here's what we need to look forward to is that, one, we're below declining 5-day moving average. We got deeply oversold. It probably got overdone on a daily basis today. That doesn't make it a buy. But if we start to see a bounce, then, of course, you want to keep an eye on today's volume-weighted average price that on Monday that would become the two-day VWAP. And that might be where supply is found. But what I think is more likely is that we're going to at least come under this little low right here. The market loves to do this, which is to go slightly under an important low, in this case, 731.53. The market loves to undercut those lows and then turn higher. Now, a turn higher, we would, of course, want to participate in. But if it finds supply up at that 20-day moving average, which at that point will be flat to declining, then we have to be concerned that maybe this is what will end up, you know, everyone will call it a head and shoulders top, and that's fine. But what it also would be is a lower high followed by a lower low here, and that would indicate perhaps a pullback down towards the 50-day moving average, which will be rising, and the anchor from the low. So right now, that zone is right in here. This is the dangers, well, not the zone that we might either continue to fall straight into, or if we get a bounce and see another leg lower, that's likely where it's going to head. Let's stay focused on where we are now. For the NASDAQ, this very violently broke below the 20-day moving average. I pointed out this anchor as a level of interest today on Twitter, and I said it's a level of interest, not a place to automatically do business. That was at, what, 728, let's just call it 729. If you look at the shorter-term timeframe, when we were at that 729 level, was there any reason at all to be a buyer? Absolutely was not. We got briefly above the volume-weighted average price twice here today. So let's say you bought there, and then you got stopped out below the low of the day. Well, we continue lower. Now, the path of least resistance is lower, so you shouldn't be looking to be a buyer. It is now time to play a more defensive posture. For the NASDAQ, if we continue to pull back in a similar fashion that I just outlined, we might undercut this a little low right here before making a bounce. So that's 695. So, you know, it doesn't seem unreasonable to think we could drop 20 points on Monday, maybe even continue down to that 50-day moving average. Maybe not Monday, but early next week, and then maybe it gaps down, and we see it turn around Tuesday. The bottom line is nobody knows what will happen. I just know it's time to be much more defensive, and the market told us that message, as I mentioned. We saw it break down on a gap on Thursday. It rallied up to the week-to-date in the 5-day moving average. Today, we lost those, and now we're below a declining 5-day moving average. So key things to look for, a potential of a turn after an undercut of this level. If not, continue down towards the 50-day moving average in the anchor off of the April low. That would bring us into this zone right here. These are the levels I update every single day for AlphaTrend subscribers. In fact, on Wednesday, I had pointed this out about the mags, saying that the mags were looking dangerous. I pointed out that let's not call this a double top yet on Wednesday. On Tuesday, actually, I pointed out and said, what's likely is we would undercut this low briefly, and then a rally. We got that rally. We got a rally up to where? The declining week-to-date volume-weighted average price and the declining 5-day moving average. These are the drawings that I had drawn in in advance, saying that if this is a double top, then this is point A. This is point B, C, and D. In fact, here's the little diagram I made of it decades ago about how a double top forms. The bottom line is what you look for is once it undercuts that low, that's where it's considered to be complete. Now, what I was saying is it undercut that low briefly here. Then it got a sucker rally, and then came the real move, and I sketched out a potential short scenario. So the price objective, looking at this, we take the height of the pattern, which is A to B, and then we subtract that height from where we break down at this point. So the height of this pattern is basically 71 and a quarter down to 68 and a quarter. In other words, it's three points. So our downward objective, our measured move from this pattern, would be down here at about 65.25. Well, when we look at the daily chart, what do we have there? Well, this is 64.77. That's your 200-day moving average. So a test of the 200-day moving average seems like a level of interest. What I really would be looking for for a bounce area would be this zone in here between that blue 50-day moving average, the green anchor off of the April low. And so in this zone is where I would expect buyers to emerge for a bounce. And what happens after that is anyone's guess. Do we bounce up and make a lower high, or do we bounce up, carve out a higher low, and then reverse back higher? For now, that's thinking too many steps ahead. That's several weeks out before that would happen, maybe a week and a half to two weeks out. But we want to look at it in terms of next week, maybe a flush down and a sharp bounce that's tradable for a bounce. The semiconductors, they broke violently below their 20-day moving average at 586. So again, people who buy at perceived levels, this is what I was talking about all week, saying it only will end badly if you don't have a plan. So these arrows are the higher lows where I was suggesting we take some off, have some stops underneath the higher lows with that rising five-day moving average. And then another stop below the 20. So in this case, what if the semiconductors continue to sell off violently? Well, here's a couple things. We would highly likely undercut this by a little bit and continue down to the 50-day moving average in the anchor off of the April low. That zone in there, you know, they line up together now because that was 52 days ago. I'm sorry, this was 50 days ago. And that means that low was 48 days ago. So you're going to be in approximately the same place. Anyways, if we undercut this low, come down really violently, I think there would be a really nice bounce trade. And then if it carves out a lower high, then we can start talking about head and shoulders patterns. Not yet, but we always have to be forward thinking so that we're not left making emotional decisions. The biotechs came down right to their year-to-date anchored volume-weighted average price with a declining five-day moving average. They had a bounce, and that failed as was expected. Now we're in this big zone. We failed in the midpoint of it with the 20- and the 50-day moving average in the April low. So, you know, the biotechs as a group are pretty much just a waste of time in here. It doesn't mean there aren't some good individual ones. Alpha Trends members are still long, some ALKS. We have half of a position from down here with half of our stop here and half of our stop here. So we're long at 37 and change, and we've got half of our stop at 40-60 and 42 and change. I don't have the numbers in front of me. Anyways, there are biotechs out there. Next week, keep an eye on Target Therapeutics. This one had some news this week. That's what caused that big. They've got a great job. I know this story a little bit. I'm not getting into the details of it. But this is one to keep an eye on. Financial stocks had a good week. On Wednesday, on Tuesday, yeah, Wednesday, they broke down. And as I told subscribers, this was an important break. If it gets back above this 51-20, then it's likely a failed move lower. So they trapped the shorts in there. And now that doesn't make them a buy. Yeah, they showed relative strength. And everyone talks about relative strength. But relative strength, where does this have the potential to go before it's likely to encounter some supply? This prior band of support in here from the first quarter, last part of last year, first two months of this year, then became resistance over here on a couple of occasions. What's to think it's not going to do that again with a declining 200-day moving average in that area? Some of you might be thinking, well, that looks like a cup and handle. And yeah, sure, maybe it does. But it's the financial stocks. Do you really think they're going to outperform? If you want to get long financials, I would say probably look at the regional banks, the KRE. I don't trade them, so I'm not going to talk about them anymore. Apple held on nicely. But here, we're seeing what? On Monday, the five-day moving average will rise. So maybe we see this happen. But on Tuesday, Wednesday, Apple has the possibility of giving back some of these gains. This is a large rally here. Don't be surprised if it pulls back. We just went from 250 to 320, basically. Big percentage move. Amazon, it broke down as well. It's below a declining five-day moving average. If you buy below a declining five-day moving average, you're typically going to get what you deserve. And I don't mean it in a mean way. I mean it in that market structure for you. Two weeks ago, Alpha Trends, we bought Google. We sold a quarter of it here. We got stopped out of the balance on this day, and it's broken. As I mentioned, I thought it would come down to the anchor from the low as well as the 50-day moving average. I would love to see it maybe come down, undercut this low, and then perhaps a bounce. That's how I'd be looking at Google. Meta, it's below a declining 200-day moving average. It should not surprise you to see it break down. It's a broken name. Microsoft came up to the declining 200-day moving average and completely failed. Netflix is just a dog in a downtrend. NVIDIA, this one, I got long over here, sold some here, got out of the balance on that. Not because I'm looking for this type of move, but because it gave back that large move, and it seemed like it was ready to continue lower. Now it's down to the 50-day moving average and the anchor off this low. I see a stock, though, with lower highs and lower lows, and it's going to need at least some time to heal. There is no hurry to get involved in NVIDIA. Palantir came right up to the declining 200-day moving average and did what it's supposed to. Don't trust rallies with a declining 200-day moving average. It doesn't mean you can't make nice swing trades in there if those stocks are on your focus list. But manage risk. Have your stop under the higher lows that are appropriate for your time frame. But to buy it over here and ride it all the way down, that is the type of thing I teach all the time not to do. Tesla, I don't know how many people asked me if I thought Tesla was a buy this week, and I said, listen, it looks like it might be setting up here. It's holding the 200-day moving average. The 50 is rising. The 20 may be giving us a little bit of reason for pause, but the most important thing that happened this week is it broke below the 5-day moving average. It rallied up and found supply. It gapped up and found supply. Don't trust rallies from an intermediate term. Don't be making buys for a swing trade with a stock with a declining 5-day moving average. And that alone saved a lot of people a lot of money. That was down 8% here today, 6.5% rather. Anyways, you know, everyone's talking about the SpaceX IPO. There is not one single person who knows what will happen with that IPO. You can find a million different opinions out there. The bottom line is only price pays. Look at Cerberus. This thing came public at $185 per share. And initially, we got a little bit of a bounce back above the VWAP. It failed. And look at how it's been behaving with the 5-day moving average. Failures right at the 5-day moving average. Three times in its short existence in the last month as a publicly traded company. If you don't think there's value in this 5-day moving average, you're out of your mind by this point. Q&T was a big IPO yesterday. It came public at $60, opened up at $67, and is sold off very hard. Nobody knows what's going to happen with SpaceX. I know this. It's going to be volatile. There are opinions everywhere. Let the price action shake out a little bit. You don't have to be the first one to own these names. They often will come back maybe a month later, it takes. People are still looking at CoreWeave. That was a hot IPO. And this IPO came public. It had this massive rally. It came public at $40. And then it's been falling apart. Circle was another one. Circle is another name that came public. That's why I typed it in wrong. CRCL. But look at the IPO. This right here. It had that big run. When it broke the anchor from the IPO, it keeps coming up to it and failing there. So just be patient with the SpaceX if you're interested in it. Have a good weekend, everybody.