# The First Signs Of REAL WEAKNESS? **Date:** 2026-08-16 **Source:** [YouTube](https://www.youtube.com/watch?v=YGB7vMm4mJ4) ## Main Thesis While major equity indices remain in a bullish uptrend, there are significant underlying signs of weakness and rotation, particularly the underperformance of semiconductors and stress in commodity markets like copper and diesel, suggesting a late-cycle environment where Wall Street is quietly repositioning. ## Charts & Technical Analysis ### 1. FINRA Margin Debt (None) **Bias:** BEARISH **Historical Comparison:** Each bubble must create a new peak in margin debt. The latest data from July shows the first drop in margin debt since the rallies began in 2025. Atkinson notes that if this drop continues for a couple of months, it tells a very different, more bearish story for the market. This is presented as a potential early warning sign. ### 2. European Banks vs S&P 500 vs Magnificent 7 (12 months) **Bias:** NEUTRAL A comparison chart shows that top European banks have outperformed both the S&P 500 and the Magnificent 7 over the last 12 months. Atkinson interprets this as a sign that deregulation is still 'alive and well' and that financials are not yet showing signs of a major sell-off. ### 3. Copper (weekly) **Bias:** NEUTRAL **Pattern:** Backwardation **Key Levels:** $370 plus a ton front month spread, $434 per ton 3-month spread **Historical Comparison:** The front month copper spread is the biggest premium since the 2021 supply squeeze. Atkinson highlights a major issue in the copper market, which is trading in massive backwardation with stockpiles dropping, according to the London Metal Exchange. The front month spread surged to over $370/ton and the 3-month to $434/ton. This signals a potential geopolitical problem and supply squeeze. However, looking at a blended futures chart, the price itself is continuing to grind higher, which is typically a sign of economic growth or inflation. ### 4. Nvidia (NVDA) (None) **Bias:** BEARISH **Key Levels:** $250 billion guarantee, below $120 billion Citing a Wall Street Journal report, Atkinson notes that Nvidia appears to be pulling back. Nvidia and OpenAI are reportedly restructuring a large Ohio data center deal, with Nvidia reducing its proposed $250 billion guarantee to below $120 billion. This is presented as a potentially negative development. ### 5. S&P 500 (SPX) (None) **Bias:** BULLISH **Pattern:** Uptrend (series of higher highs and higher lows) **Historical Comparison:** The current AI-driven rally is compared to the dot-com boom (Netscape analog). The bull market is up 115% since 2022, and historically these can last 5-6 years. Despite the lowest volume day in over a year, Atkinson states this is not necessarily a bearish signal. From a price action standpoint, the S&P 500 remains bullish, making a series of higher highs and higher lows and has not even pulled back to basic VWAPs. He notes that going against this trend is a guess. ### 6. USO (Oil ETF) (None) **Bias:** BULLISH **Pattern:** Double bottom test USO saw the single largest transaction in the last couple of years. A key level has been tested twice from the bottom up, indicating it's becoming an important support zone. ### 7. 30-Year US Yield (None) **Bias:** BEARISH **Historical Comparison:** Closed near highs since 2007 or 2004. The 30-year yield, which the Fed doesn't really control, closed near its multi-year highs. Atkinson calls this the 'fear of the unknown' and a sign that the bond market is waking up to inflationary pressures, which could put pressure on treasuries. ### 8. Google (GOOGL) (None) **Bias:** BEARISH Atkinson notes Google is not doing well, having been down 11 of the last 13-14 weeks. The chart shows 'weak rejections' and 'rejection wicks', indicating selling pressure. He sees this as a sign of divergence within the Magnificent 7. ### 9. JPMorgan (JPM) (None) **Bias:** NEUTRAL JPMorgan is described as 'still doing fine at this point,' suggesting no immediate signs of stress in the major banks. ### 10. US Dollar (DXY) (daily, 4-hour) **Bias:** NEUTRAL Speculative positioning is in the 'danger zone' (very bullish), which makes Atkinson cautious. He finds the price action confusing, holding demand but with some structural shifts. He views the dollar as a 'neutral position' and something to watch for its effect on other markets. ### 11. US Oil (WTI/Crude) (None) **Bias:** BULLISH **Pattern:** Sideways consolidation, potential flag **Key Levels:** 86 resistance, 74 support Oil is sitting sideways, having not closed above 86 or below 74. Atkinson notes this could be considered a flag pattern, which if it breaks out, could lead to a new high for energy prices. ### 12. CRACK (Oil Services ETF) (None) **Bias:** BULLISH **Pattern:** Breakout / Uptrend Atkinson highlights that this ETF has seen an incredible rise since July, after the mainstream press stopped talking about it. He points to this as an area where Wall Street has figured out there is a supply/demand bottleneck and is moving money. ### 13. Chevron (CVX) (None) **Bias:** BULLISH **Pattern:** Inverse head and shoulders Chevron is showing a potential inverse head and shoulders pattern and has closed above the technical neckline. This indicates significant strength, even if it's 'a little bit late to the party'. ### 14. Gold (XAU/USD) (weekly, daily, 4-hour) **Bias:** NEUTRAL **Pattern:** Pit (channel / accumulation) Gold has improved recently but is now holding and sitting in a range on the 4-hour chart, which Atkinson calls a 'pit' or a 'pullback in time'. It is consolidating and resetting indicators. The weekly close was 'okay'. ### 15. Silver (XAG/USD) (None) **Bias:** NEUTRAL **Pattern:** Sideways consolidation Described as being the same as gold, 'pretty much sitting around doing not much' after it rallied and hit the peak of press coverage. ### 16. Semiconductors vs SPY (Ratio) (None) **Bias:** BEARISH **Pattern:** Underperformance / Downtrend **Historical Comparison:** Similar to what has happened in previous new technology rallies that ended in a bust. Atkinson calls this ratio the 'backbone of the market' and notes it is 'not exactly filling you with extreme confidence'. He warns that if this ratio continues to drop while the broader market goes up, it is a significant historical warning sign of a potential bust. ### 17. KWEB (Chinese Tech ETF) (None) **Bias:** NEUTRAL **Pattern:** Pit (potential) The ETF hit resistance (also seen on HSI) and has since been 'floating around'. Atkinson suggests it could be going into a 'pit' or consolidation phase. ### 18. Australian Market (ASX200) (None) **Bias:** BULLISH The Australian market has improved a lot, making a new all-time high just a week ago before pulling back. The strength is driven by energy, commodities, and banks. ### 19. SpaceX (None) **Bias:** NEUTRAL **Key Levels:** 145 resistance, 150 resistance, 125 support Based on the options market, Atkinson identifies expected resistance around the 145-150 level and probable support around 125. ### 20. Nasdaq 100 (QQQ/NDX) (None) **Bias:** BULLISH **Pattern:** Sideways consolidation The Nasdaq remains bullish but is moving sideways, coming into a level of resistance. (Note: Specific levels mentioned in the transcript like 730, 740, 750 are clearly mis-transcribed for QQQ and are omitted as per instructions). ### 21. Bitcoin (BTC) (None) **Bias:** NEUTRAL **Pattern:** Pit (sideways consolidation) Bitcoin is in an 'almighty pit' and is 'like watching paint dry'. Atkinson advises there is nothing to do but set alerts on either side of the range and wait for it to make a move. ## Regime / Cycle Analysis The market is described as being in a 'late cycle' phase. This is characterized by several intermarket signals: 1) Deregulation helping sectors like European banks outperform. 2) A rise in commodities like metals and oil, which is symptomatic of the end of long-term cyclical bull runs. 3) A critical divergence where semiconductors (the engine of the rally) are underperforming the S&P 500, a historical parallel to previous technology-led busts. 4) Rising long-term bond yields (30-year) signaling inflation fears, which are corroborated by rising diesel and oil prices. ## Key Calls & Predictions - The underperformance of the semiconductor sector relative to the S&P 500 is a major warning sign that must be continuously watched. - Wall Street is rotating into energy sectors like oil services (CRACK ETF) and this is a key area to monitor, as it's happening away from mainstream press attention. - The backwardation in copper and the rise in the 30-year US yield are significant signals of supply stress and inflation that could spill over into broader markets. - A continued drop in FINRA margin debt would be a very bearish signal for markets. - Despite underlying warnings, the price action of the S&P 500 remains bullish (higher highs, higher lows), and fighting the trend is not advised. - The key things to watch for the week are copper, oil, and bonds, with a focus on sector rotation. ## All Instruments Mentioned S&P 500, FINRA Margin Debt, European Banks, Magnificent 7, Copper, Diesel, Nvidia, OpenAI, SpaceX, USO, CRACK, Junk Bonds, 2-Year US Yield, 10-Year US Yield, 30-Year US Yield, Google, JPMorgan, Goldman Sachs, US Dollar, Treasuries, US Oil, Chevron, Gold, Silver, Semiconductors, KOSPI, SPY, KWEB, HSI, Australian Market, Nasdaq 100, Bitcoin, Palantir, Wolfspeed --- *Generated by FX Evolution Monitor on 2026-08-16 23:00:52*