S&P 500, Nasdaq, Dow and Russell 2000 For the Week Ahead

S&P 500, Nasdaq, Dow, Russell 2000 Talking Points:

• It was a sizable sell-off for the Nasdaq last week as several high-flying AI stocks were hit.
• S&P 500 Futures are setting up a bearish engulf on the weekly chart and it was also a sizable sell-off in the Russell 2000, as the index came up on a massive support level. Meanwhile the Dow was actually green on the week.  

It was a rough week for stocks. In the S&P 500 this was a change of pace, as just a week before the index set a fresh all-time-high. But in the Nasdaq and perhaps more to the point, the high-flying AI stocks that had led the Nasdaq higher from the 2022 lows, there were warning signs that had started to show.

I looked at that context in last week’s Top 5 Charts for the Week Ahead, highlighting a bearish engulfing pattern on NVDA, taken with the context that the stock has stumbled even with a massive buyback announcement and strong quarterly earnings numbers.

NVDA Bearish Engulf

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S&P 500 Futures

On the weekly chart for S&P 500 futures, there’s a similar setup that’s started to show. After opening above the prior week close price has slid below the prior week’s low and open, which makes for a bearish engulf on the weekly chart for the S&P 500 index.

There’s also a rising wedge formation, taken from the continued stuttering below the 8k level, even as buyers have remained rather active on pullbacks or support tests. But that’s what started to change last week as price put in that bearish engulf pattern and this highlights the prospect of a steeper sell-off in the days and weeks ahead.

With that said, there may be more amenable pastures to push for that bearish theme in stocks, which I’ll look at below. But first, from the weekly chart of ES we can see a couple of key inflection points, the first of which is a support level taken from prior resistance at 7715. For lower-high resistance, there’s another prior resistance swing that had previously helped to set support at 7782. And above that, there’s the 7838 level followed by the ATH that printed just two weeks ago at 7897.

For next supports down – there’s a prior swing at 7657 that’s of note, and that’s followed by 7585 which was a pivot level in early-September. If the 7519-7542 zone gets taken out, however, bears will have a decisive hold on near-term price action and that’s where the bearish engulf and rising wedge break would support a larger bearish move.

S&P 500 Weekly Chart

Chart prepared by James Stanley; data derived from Tradingview

Nasdaq

The Nasdaq 100 lost more than 5% last week which was the largest single-week loss since early last year, right around the time of the tariff bounce in the index. And while it’s simple to look at the internals of the matter and speculate for continuation, the fact of the matter a sell-off coming on that quickly can be difficult to chase.

Nasdaq Weekly Chart

Chart prepared by James Stanley; data derived from Tradingview

Nasdaq Shorter-Term

With the Nasdaq pushing a fresh low towards the end of the week the question is whether we see panic spread over the weekend to allow for a gap-down on the Sunday open, and given some of the pain seen in Asian markets like Korea and Japan, that would certainly have to be entertained as a possibility.

The counter to that, is given the rise in oil prices likely playing a big role in this additional pressure, that gives President Trump a lever, so to speak, with which he could possibly draw back some of that fear – so calamity is far from a foregone conclusion at this point.

From the daily chart there are two areas that stand out for lower-high resistance potential:  The 30k psychological leel and then the prior swing low at 30,370. Above that and what I’m considering as ‘r3’ into next week, is the zone running from 30,861-30,975.

Nasdaq 100 Daily Chart

Chart prepared by James Stanley; data derived from Tradingview

Dow Jones

Perhaps surprisingly it was a second consecutive green week for the Dow and this comes after the index limped into Q4 lagging behind both the S&P and Nasdaq. To buffer that excitement, however, the Friday high printed at a familiar spot of support-turned-resistance, so it’s too early for bulls to celebrate just yet as there’s claim to shorter-term lower-highs.

But – if buyers can re-claim that spot at 53,812, the door opens for a run at the highs and the prior ATH printed just inside of the 55k psychological level for the index.

On the short side of the matter, it’s the 50k level that stands out as support potential after having provided resistance multiple times in early 2026 trade.

Dow Jones Weekly Price Chart

Chart prepared by James Stanley; data derived from Tradingview

Russell 2000

With high rates acting as a pressure point, smaller capitalization companies have been suffering and this shows prominently in the Russell 2000, which sank to a fresh six-month-low last week. As I had highlighted in the Q4 equity forecasts, this index stood out for bearish biases in equities into the end of the year and that’s played out so far, as each weekly candle has been red for the past six weeks, and for eight of the past nine.

Russell 2000 Weekly Chart

Chart prepared by James Stanley; data derived from Tradingview

Russell 2000 Daily

The bearish engulf currently showing on the daily bar keeps the door open for bearish continuation into early trade next week, although chasing is a challenge given where price is, as of this writing.

For lower-high resistance, there’s two spots that stand out:  The Fibonacci level and the top of that longer-term support zone, 2772, and then a prior swing-low turned resistance at 2793, which can be synced up to 2800 to create a zone.

Russell 2000 Daily Chart

Chart prepared by James Stanley; data derived from Tradingview

--- written by James Stanley, Senior Market Analyst, Global Macro