Hello everyone, welcome back to the U.S. stock analysis channel. I’m lorder.

The market is under broad pressure today, especially in the tech and semiconductor sectors, as the surge in long-term Treasury yields weighs on growth stock valuations and the financing costs for AI data centers. Several key ETFs have already broken below or are approaching important support levels, and we need to be alert to the risk of further downside. Our stance is bearish and we’re staying on the sidelines.

Let’s start with the overall market picture. Long-term Treasury yields, particularly the 30-year, have climbed to multi-year highs. This not only compresses tech stock valuations but also significantly raises the financing costs and default risk for companies that are borrowing heavily to build AI data centers. Let’s look at the credit default swap data, or CDS, for the relevant companies. The data shows that for names like CoreWeave, Oracle, SpaceX, Meta, and Nvidia, their five-year cumulative default probabilities have risen markedly, with CoreWeave’s default probability approaching nearly 50%.

At the index level, SPY has already broken below the minor support at 768. The next area to watch closely is the key support zone from 756 to 745. If the trend breakdown point at 729 is also lost, that would trigger a larger-scale pullback. On the fundamental side, while there are expectations for upward EPS revisions, they are being offset by the risk posed by Treasury yields. QQQ is currently trading within the 705 to 724 range. A break below 705 would signal weakness, and once the breakdown point at 693 is breached, the next target would be below 665.

In the semiconductor sector, SOXX’s rebound failed under the resistance band from 550 to 580 and has pulled back sharply below 532. Until it can effectively break through resistance, any rally can only be viewed as a bounce. Now we’re watching to see if it can stabilize at 532. SMH’s price action is converging with SOXX, currently in the 557 to 581 range. A break below 535 would turn the outlook bearish. The software sector ETF, IGV, is moving sideways today with internal divergence among its components. It’s holding up better than semiconductors overall, but neither sector has completed a breakout.

On individual stocks, HD’s earnings report is out. The business has stabilized but lacks growth momentum, and it’s currently in a defensive phase. The stock has both technical and fundamental support in the 328 to 336 area, but it needs to break above 366 to open up upside potential.

META dropped another few points today, reaching the key support level at 540, which is near its prior low. If the decline continues, the area approaching 500 might be a level long-term investors would consider. Microsoft is trying to find a floor around the 487 line, but it’s moving sideways on shrinking volume with a weak pattern, so it may be worth waiting for a clearer signal.

Finally, let’s sort through the main current risks. First is the Treasury yield risk: elevated long-end yields are directly hitting growth stock valuations. Second is the data center default risk: the companies mentioned earlier are under immense pressure from financing costs. Third is the risk of technical breakdowns in the market: major ETFs like SPY, QQQ, SOXX, and SMH are all testing key support, and a loss of these levels could trigger a trend-following decline. On the macroeconomic front, weak housing starts data, downward revisions to GDP growth forecasts, and the high interest rate environment all weigh on corporate earnings prospects. For individual stocks, META also faces significant litigation risk. While the final penalty amount may be far lower than the lawsuit’s claim, a settlement that draws some blood is unavoidable.

When the market is under pressure, what it tests most is patience and discipline. Remember, don’t act blindly before a resistance level is effectively broken. Waiting for a right-side confirmation signal is the more prudent approach. That’s all for today. We’ll see you at the same time tomorrow.