Selling Sweeps Stocks Part 2 - NVDA Fades, PCE Looms

Market Update: Thursday, February 27, 2025

Feb 27, 2025

The Markets

No letup yet—the selling has been relentless since last Friday.

SPY, QQQ, and IWM are still digging lower, and DIA’s early-week strengthening attempt has faded into the red. February’s seasonal pullback is playing out, but the tempo’s picked up midweek. The action is still well within the realm of normalcy for this time of year. Below the surface, though, are continued hints at a safety shuffle as defensive areas show relative strength while small-caps keep stumbling.

It's cautious, but it’s not a full retreat—just a market testing its footing.

NVDA took the stage last night, and the spotlight didn’t flatter.

The results were good, just not the blockbuster report needed to jolt the market awake. Shares were down -8.48% today, tugging QQQ down and denting tech’s shine. It’s not a trainwreck—just a missed chance to rally the troops, leaving the Magnificent 7 looking a tad less magnificent.

PCE data — the Fed’s inflation yardstick — is out tomorrow (Friday) morning.

With sentiment shaky and inflation chatter buzzing, a hotter-than-expected read could nudge rate fears higher. Today’s selling feels like traders trimming sails before the wind hits.

The Charts

SPY is now down nearly -5% in a straight line and on heavy volume since the failed breakout last week. RSI is nearing oversold levels. The next potential support levels are $579.32, $575.35, and $570.17 — the August low AVWAP, a January pivot low, and the 200-day MA.

QQQ is -7.5% off the highs, slicing cleanly through the Sept. pivot low AVWAP and nearing the same from the August low. That level - $496.61, is followed by the 200-day MA at $491.37. Volume is much higher than average, and RSI is ~32, nearing oversold levels.

IWM was down another -1.53 %, bringing the total decline to a drop of more than 6% since the selling started last week. There is a long-standing pivot area just under $212 for potential support. Beyond that, there is no help other than pivots at ~$204 and ~$196. RSI is oversold, and volume has been heavy.

DIA has held up better in that the last five trading days have been more of a bearish consolidation pattern than a straight-down selloff. However, today’s closing price has broken that pattern to the downside, potentially opening the door to further selling.

The August low AVWAP is at $426.77. Then there is the 200-day MA and another pivot level at $418.35 and $416.55.

TLT is the rare bright spot in these charts, climbing higher and looking to test the 200-day MA.

DXY Dollar futures found firmer footing and fought their way up to the 21-day MA.

BTCUSD After many successful tests, Bitcoin has sliced through three of the four AVWAPs on this chart, with the one from the September pivot lows (in purple) having almost no relevance.

Now it’s up to the one from the August low and the 200-day MA to save it. They are trying now and may get some help from an oversold RSI that has dipped below the mid-20s — a rarely seen occurrence.

The Trade

It’s a scrappy trader’s game right now.

Quick trades are finding traction—zip in, zip out—but swing plays are getting diced by flip-flops. NVDA’s hiccup isn’t the end of the world, just a memo that tech’s not bulletproof. For the long-haul crowd, this is February doing its thing—pullbacks from highs aren’t headline news yet.

Small-caps are the sore spot, though; they’re not winning any fans.

Stay sharp: those support levels are your breadcrumbs—watch if they hold or crumble. If PCE lands tame and we limp through February, March might bring sunnier trades. Short-term hustle or long-term calm is the ticket—the middle ground’s a tough hangout this week.

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***This is NOT financial advice. This is NOT a recommendation to buy, sell, or trade any security. The content presented here is intended for educational purposes only.