Rotation Watch: Tech Firms as S&P and NQ Defend Support

E-mini S&P (December) / E-mini NQ (December)

S&P, last week’s close: Settled at 6856.25, down 24.75

NQ, last week’s close: Settled at 25,380.25, up 37.50

Yesterday could have been the start of a rotation back into tech. The E-mini Dow lost 0.74%, the E-mini S&P lost only 0.36%, with healthcare, financials, and industrials all losing ground, while the E-mini NQ edged out a gain of 0.15%, led by software up 0.87%.

Nonfarm Payrolls played catch-up yesterday due to delays caused by the government shutdown. October showed 105k jobs were lost, and Wages were strong at +0.4% m/m, however, November showed a small gain of 64k jobs, while Wages came in light at +0.1% m/m. Additionally, the Unemployment Rate rose to 4.6%, a level above the Fed’s consensus view through 2026, supporting rate cuts.

E-mini S&P futures pinged the .382 retracement back to the November 21st low, while the E-mini NQ hit the 50%, and buyers stepped in. Additionally, we are seeing a risk-on thrust from support in tech versus large-cap value (chart above). Remember, large-cap value has gotten all the talk of late, and those sectors struggled mightily yesterday in a manner that felt like a rotation back to tech. We must see the E-mini S&P hold above our Pivot and point of balance at 6865 to signal a constructive tape and set up a repair of the damage going back to Friday. In order to begin that repair, tech must lead. We want the E-mini NQ to break out above major three-star resistance at….