Major US stock indices have fallen, but not as much as expected from premarket futures. The NASDAQ dropped by 162.2 points, which is a 0.83% decrease. The S&P index is down by 46.2 points, or 0.76%, while the Dow has fallen by 575 points, a 1.34% drop. Shares of Adobe slid by 7.15% even after beating expectations and offering a slightly positive forecast. Meta’s shares stayed the same, while Apple’s stock dipped by 0.94%. Amazon’s shares fell by 1.12%, Microsoft is down by 0.11%, and Alphabet dropped by 0.99%. Tesla and Nvidia also saw declines, with decreases of 0.1% and 1.19%, respectively. The University of Michigan will soon release its preliminary consumer sentiment figure, expected to be 53.5. The current conditions figure is likely to be 59.4, and the expectations figure is projected at 49.0. Even though the drops are softer compared to earlier trading, the declines across all major US indices show a market that is becoming more cautious. The NASDAQ’s 0.83% decrease suggests that tech sector optimism is waning. Big drops like this, especially alongside declines in the S&P and Dow, indicate a broader cautious sentiment, not limited to just one sector. Adobe’s price drop deserves further attention. The 7% fall, despite good revenue and guidance, might mean that investors were expecting even more or looking to take profits. When positive news doesn’t raise stock prices, it usually signals that expectations were too high. This tends to worry short-term traders who rely on momentum. The overall behavior of major tech stocks, particularly Meta’s stability and the drops in Apple, Microsoft, and Alphabet, supports the idea that enthusiasm is cooling. This isn’t a full reversal, but more like a pause after months of gains. Tesla and Nvidia’s slight declines also add to this sentiment. There’s no rush to sell, but buyers aren’t jumping in enthusiastically either. Amazon, which often quickly adjusts to retail spending expectations, saw a 1.12% drop. This may reflect the consumer mood data expected soon. The University of Michigan’s sentiment figures typically indicate demand confidence. At 53.5, this expected reading is historically low. Both the current conditions and expectations are below levels usually linked with strong consumer activity, suggesting shoppers are worried and don’t expect significant improvements soon. This situation feels uneasy with high valuations. In an environment of low confidence, assuming steady revenue growth starts to look risky. Therefore, we should be cautious about taking overly ambitious positions based solely on recent price trends or brand loyalty in any single stock. It’s not enough to trust resilience right now. Instead, we are closely monitoring implied volatility metrics. They may widen in the coming sessions, potentially offering good entry points for selling options. However, timing is key—it would be unwise to start short-delta trades before key sentiment or inflation data without protection. We are also watching the skew closely. If we notice traders paying more for puts than calls in large-cap stocks, it might indicate that hedging is increasing. This often signals that downside risks are being priced in more heavily, offering better options for directional exposure. In this kind of market, where reactions don’t always match the news, patience and discipline are crucial. Nothing appears to be broken, but there are signs of dislocation—this is when our strategies often perform best.

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