The global tech-stock sell-off has now run for more than three weeks, and most markets have pulled back to varying degrees. Among them, the sharply-corrected Korean market has even slipped into a technical bear. So is the current decline the eve of a major reversal, or just another routine technical pullback as so often before? Beyond Korea, Japan's market may offer the more valuable reference point.
The valuation debate over tech stocks (AI-related) has raged for a long time, and trying to read it from a purely fundamental angle only ends in a dialogue of the deaf. Optimists believe the AI revolution will ultimately arrive; pessimists are convinced the bursting of the bubble is only a matter of time. In truth, for a trader, who is right or wrong is not the point—the point is which moment in time is right. If the market and the price action have not delivered a clear trend change, it is best not to jump to conclusions or take any counter-trend trades.
Across global markets, let us first establish the broad strength ranking and its priority. U.S. equities are unquestionably the sole “Tier 0” of this cycle—almost 20 years of a slow bull—boasting both excellent drawdown resilience and a clear edge in long-term upside. Europe and most Asian markets belong to the following second tier, showing a distinct “the rich lead, and the rest follow” pattern. As for small-float, high-volatility markets such as Korea, they resemble silver's role last year: with the whole crowd piling on leverage, circuit-breakers have become an everyday occurrence.
From this chain of logic, two corollaries follow. First, as long as U.S. equities (AI) do not fall, global markets will not face systemic risk; and among the major markets, even in a reversal or a large-scale drawdown, U.S. equities will show the best resilience. Second is the meaning of a reverse leading indicator: markets that merely follow and lean on liquidity-driven momentum serve as a warning gauge, but only a quantitative build-up can trigger a qualitative change. As for the relationship among sectors, individual names, and the index, there is no need to argue which leads and which lags—they are inherently complementary.
Accordingly, we first keep a close watch on the Nasdaq. Its most recent weekly low of 28,227 is the initial support; if that breaks, the summer market will most likely fall into a high-level ranging mode, and the strength and mood of the bulls will weaken to some degree. But as long as the more important prior all-time high of 26,400 is not effectively broken back through, there is no need to fear greater systemic risk. Given last week's poor weekly close, the odds are not small that over the coming weeks the Nasdaq hunts for new pullback support within the 28,227–26,400 zone.
$纳指100ETF(QQQ)$ $纳指三倍做多ETF(TQQQ)$ $纳指三倍做空ETF(SQQQ)$ $NASDAQ100指数ETF-Invesco(QQQM)$ $纳斯达克(.IXIC)$ $标普500ETF(SPY)$ $标普500(.SPX)$ $SP500指数主连 2609(ESmain)$ $微型SP500指数主连 2609(MESmain)$ $NQ100指数主连 2609(NQmain)$ $微型NQ100指数主连 2609(MNQmain)$
Chart: Nasdaq-100 E-mini Futures (Weekly, CME) — TradingView; last ~28,865, blue line marks the prior all-time high at 26,433.75
Next, let us review developments in Japan and Korea. The Nikkei's maximum drawdown from its all-time high has reached double digits, but has not yet hit the so-called 20% bull-to-bear watershed—it would need to break through 59,000 to trigger that alarm. On the weekly chart, two key supports at 62,535 and 59,335, together with the prior high of 60,080, all sit above the 59,000 mark. As one of the important benchmarks since last year, Japanese equities would need to break below 59,000 before one could declare the market clearly weakened. If price merely oscillates among the levels above, the overall picture will resemble the Nasdaq's.
$日经225指数(N225.JP)$ $GX亚洲半导体(03119)$ $南方日经225(03153)$ $南方两倍做多日经(07262)$
Chart: Nikkei (USD) Futures (Weekly, CME) — TradingView; last ~64,880
The Korean market, as noted earlier, has already turned technically bearish, with this month's decline already exceeding 20%. We can broadly judge that a significant top has formed; even if a rebound follows, refreshing the all-time high would require substantial external tailwinds. 6,347 is the next short-term support, while the strong support near 5,000 would offer a powerful rebound opportunity.
$SK海力士(SKHY)$ $2倍做多海力士ETF-Corgi(SK)$ $南方两倍做多海力士(07709)$
Chart: KOSPI Composite Index (Weekly, KRX) — TradingView; last 6,678.73
After weighing all three markets together, my current preferred path for what comes next is: a pullback first (not a reversal), then a second attempt at the highs, before facing a turning point at a key time node in the fourth quarter. If strong instruments pull back with enough force to offer an attractive risk-reward ratio, then within the summer market I still favor going long from the lows.
Strategy Updates
On strategy: the previously-established long in euro futures was filled at 1.1420. Over the past two weeks the exchange rate has made little progress, so no adjustments have been made. Stop and targets remain unchanged: stop set below 1.1300, targets set at 1.1770 and 1.2420 (half position at each).
On crude oil: with the long filled at the 70 level, all pending orders are now complete, at an average long price of 75. News drove a rebound but brought no substantive change, so we continue the earlier plan. Stop set at 60, targets set at 95 and 115 (half at each).
$WTI原油主连 2609(CLmain)$ $微型WTI原油主连 2609(MCLmain)$ $小原油主连 2609(QMmain)$
This week, a pending-order attempt on U.S. equities: limit-long the Nasdaq at 26,080 and 24,720 (half at each), stop set below 23,000, targets set at 30,500 and 33,800. GTC orders, valid until cancelled.
P.S. If a trade reaches its first target, the stop will automatically be moved to the entry level. Should any adjustments occur after fills, they will be updated in subsequent articles.
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