To The Moon

Last week U.S. equities posted a weekly decline: the S&P 500 ETF (SPY) fell 1.54% for the week, but sector performance diverged sharply. Energy rose 4.72%, leading the entire market; Real Estate, Consumer and Financials also gained; Technology plunged more than 5%, becoming the main drag on the index. Capital is rotating out of high-valuation sectors into Energy, Real Estate and defensive sectors in search of internal rebalancing — and the sectors that had been leading are starting to loosen.

$Invesco QQQ(QQQ)$ $NASDAQ(.IXIC)$ $E-mini Nasdaq 100 - main 2609(NQmain)$ $Micro E-Mini Nasdaq 100 - main 2609(MNQmain)$ $S&P 500(.SPX)$ $SPDR S&P 500 ETF Trust(SPY)$ $E-mini S&P 500 - main 2609(ESmain)$ $Micro E-mini S&P 500 - main 2609(MESmain)$ $Cboe Volatility Index(VIX)$

In detail, SPY fell 1.54% last week. Of the 11 sectors, 5 rose and 6 fell: Energy (XLE) led with +4.72%; Real Estate, Consumer Staples and Financials gained 2.18%, 1.27% and 0.99% respectively; Technology (XLK) tumbled 5.48%, the single biggest drag on the index.

$SPDR S&P 500 ETF Trust(SPY)$ $NASDAQ(.IXIC)$ $Invesco QQQ(QQQ)$ $Energy Select Sector SPDR Fund(XLE)$ $Technology Select Sector SPDR Fund(XLK)$

Valuation: The Market Will Be Pickier About Earnings Delivery

According to the latest World P/E Ratio data, among current U.S. sector valuations Technology sits at about 34.49x earnings, Real Estate at 32.39x and Industrials at 31.40x — overall still relatively elevated. By contrast, Financials (17.31x) and Energy (20.26x) are relatively cheap. On a long-run basis, the valuations of Technology, Industrials and Financials are all near the upper end of their roughly 20-year ranges.

Index Valuation Is Relatively High

On a broad-index basis, the S&P 500's current P/E is above its roughly 25.3x ten-year average, which means overall market valuation remains historically elevated.

Rate Constraint: The Absolute Valuation Premium Has Turned Negative

The S&P 500's earnings yield (the inverse of its P/E) is about 3.49%, while the latest 10-year U.S. Treasury yield is 4.55% — a gap of roughly -1.06 percentage points. This “yield gap” can be read as the static earnings compensation for holding stocks versus risk-free Treasuries. Turning negative does not mean stocks will fall immediately, but it does mean valuations now depend more heavily on future earnings growth and rate-cut expectations. If long-end rates rise further, or corporate earnings disappoint, volatility in high-valuation sectors could be amplified.

Below are the latest views shared this week by several Tiger Community experts:

Cheng Jun (程俊): Korean Stocks Have Entered a Technical Bear Market; the Nasdaq Stands at the Cliff's Edge

As of July 20, 2026, the global tech-stock sell-off has lasted more than three weeks, and most markets have pulled back to varying degrees. Korean stocks, which corrected most sharply, have even slipped into a technical bear market. So is this decline the eve of a major-degree reversal, or — as so often before — merely a technical pullback? Compared with Korea, Japan's market may be more instructive.

As long as U.S. stocks — and the AI theme in particular — do not collapse outright, global markets are unlikely to spiral into systemic risk. Among the major markets, even in the event of a reversal or a larger pullback, U.S. stocks' resilience may still be the strongest. So the first priority now is the Nasdaq: the recent weekly-chart low of 28,227 is initial support; once it breaks, the summer market will most likely enter a high-level, choppy regime, with both bullish momentum and sentiment weakening somewhat.

But as long as the more critical 26,400 level — a prior historical high — is not effectively broken, there is no need to worry excessively about larger systemic risk. Given last week's soft weekly close, there remains a fairly high probability that new pullback support will be found within the 28,227–26,400 range over the coming weeks.

As for the Nikkei, its maximum drawdown from the all-time high has already reached double digits, but it has not yet touched the so-called 20% bull-bear dividing line. In other words, only a break below 59,000 would formally trigger a bear-market alert. The two key weekly 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 key barometers since last year, Japanese stocks would need to break 59,000 to signal a clear weakening; if they merely pull back among those levels, the overall picture remains similar to the Nasdaq:

$Nikkei 225 Index(N225.JP)$ $CSOP Nikkei 225 Daily (2x) Leveraged Product(07262)$ $CSOP SK Hynix Daily (2x) Leveraged Product(07709)$ $SK hynix(SKHY)$ $CSOP Samsung Electronics Daily (2x) Leveraged Product(07747)$ $Direxion Daily MSCI South Korea Bull 3x Shares(KORU)$

Korea, as noted, has already turned technically bearish, down more than 20% this month. This essentially confirms that an important top has formed; even if it rebounds later, making a new all-time high would require very strong cooperation from external markets. 6,347 is the next short-term support, while the strong support near 5,000 could offer a more forceful rebound opportunity:

Gan Canrong (甘灿荣): U.S. Indices Turn Short-Term Bearish; Gold May Become the Preferred Safe Haven

The U.S.–Iran conflict has now dragged on for nearly half a year, and its direct headline impact on financial markets is actually limited. What the market really cares about is that the rebound in oil prices is further fueling rate-hike expectations — so it is only natural for equity indices to weaken.

Among U.S. indices, the S&P 500 can serve as the benchmark to watch, because its sector composition is the most balanced. Once it breaks below the 20-day moving average, that is a short-term bearish signal, suitable for partial stop-loss or profit-taking; if it subsequently rebounds back above the 20-day MA, treat that as a short-term bullish flip.

$Gold - main 2608(GCmain)$ $E-Micro Gold - main 2608(MGCmain)$ $1-Ounce Gold - main 2608(1OZmain)$

$Silver - main 2609(SImain)$ $E-mini Silver - main 2609(QImain)$

At this stage, gold is in fact more likely to stage a strong interim rebound — just as our early-July article reminded readers to watch for the oil-price rebound. Most of gold's current risk may already have been released. On top of that, gold is now sitting near its 20-month moving average, a line that has long served as a key watershed for gold's long-term bull-bear balance and offers solid support. We therefore do not recommend being overly bearish on gold at this point. The rebound may be just one headline catalyst away, and is well worth watching closely.

Owen: The Worst for U.S. Stocks May Be Over; Now Is the Time to Watch the Gold Rebound

After last week's historic sell-off, the U.S. market — semiconductors in particular — stands at a truly critical crossroads. Without exaggeration: if the market takes one more step down, it could trigger a larger weekly-degree decline; but if it can hold the current drawdown and stabilize higher, aided by a de-escalation of the U.S.–Iran war, a phase rebound would not be difficult. This week's price action is therefore extremely important for U.S. stocks.

Judging by the rare intensity of this sell-off, the selling pressure on previously leading sectors such as semiconductors has in fact been fairly fully released. Consider two key volatility metrics: QQQ's realized daily range over the past 30 trading days has reached 1.5x its implied volatility — the second-highest reading in more than a decade.

Second, the SOX (Philadelphia Semiconductor Index) deviation from its 200-day moving average has fallen sharply from a near-26-year extreme high, back into a normal range.

$Philadelphia Semiconductor Index(SOX)$

These hard data all send the same signal: the wildest, most extreme phase of volatility may already be behind us. We cannot declare that U.S. stocks have bottomed, but absent another black-swan panic — such as a sharp escalation in the Middle East — tech-stock selling pressure will most likely stabilize gradually.

So why not simply call a bottom for U.S. stocks? Because one sector still deserves close attention and has yet to show any sign of bottoming and rebounding — the SOX semiconductor index.

From the SOX chart, its topping structure has already been clearly broken. By conventional technical logic, once the neckline gives way, price tends to keep falling toward the head-and-shoulders measured objective — i.e., a possible retest toward the 9,500 area. Yet barring a major bullish catalyst capable of changing the technical trend — such as a marked easing of U.S.–Iran relations, which really could flip short-term sentiment — we can neither conclude that U.S. stocks have bottomed nor arbitrarily assume there must be enormous downside ahead. For the indices, what is needed at this stage is patience.

If SOX keeps falling, we can consider an options straddle on QQQ to profit from a rise in the VIX. This is a buyer's strategy with a fixed maximum loss and relatively high overall safety.

Watching Gold Is Very Important

Bank of America's analysis argues that gold's overall downtrend is not yet over, since it has pulled back for only 24 weeks so far — short compared with past cycles that often exceeded 100 weeks. I only half agree: I likewise believe there is a tradable rebound in the near term, but when gold later falls again, the decline may not be as deep as BofA expects. Below is BofA's projected path for gold:

In my view, gold has a chance to complete its final bottoming near the 20-month moving average, without falling too deep. Technically, gold is currently using the 20-day MA as a key trigger for rebound trades, and it has just pierced this critical lifeline — so a rebound could well unfold here.

But execution must stay strictly disciplined: Step 1 — reclaim the 20-day MA; Step 2 — break the long-term downtrend channel; Step 3 — the continuous contract strongly breaks 4,236. Only after all three conditions are met should we consider adding to longs on a short-term basis.

Macro Strategy Takeaways

Cheng Jun (程俊):

Watch the Nasdaq first. The recent weekly low of 28,227 is initial support; once broken, the summer market will most likely enter a high-level choppy regime, with bullish momentum and sentiment weakening in tandem.

Gan Canrong (甘灿荣):

Strategy reference: consider selling Sell Puts expiring within one week. Underlyings can be the Nasdaq and gold. For the strike, reference last Friday's close — for the index, choose a strike more than 10% out-of-the-money; for gold, more than 6% out-of-the-money. Second, consider accumulating gold-related instruments on dips.

The core logic of the Sell Put is the expectation that the market may consolidate in the short term, especially the index; while accumulating gold futures on dips is a bet on a rebound. If gold successfully breaks the 20-day MA, the pace of the rebound could accelerate.

Owen:

If SOX keeps falling, consider an options straddle on QQQ to profit from the gamma squeeze as the VIX rises. This is a buyer's strategy with a fixed maximum loss and relatively high overall safety.

Specifically: after SOX breaks the blue support shown in the chart, simultaneously buy at-the-money QQQ puts and calls expiring in two weeks — same expiry, same strike — to capture the volatility gains from a VIX spike. The profit on one side may cover the loss on the other. After one week, consider taking profit and closing, or rebuilding a fresh two-week combination.

One more thing to watch: the VIX is likely near a relatively low point in its annual seasonal pattern: