Market Update Into February 16th: The Coil Tightens

AI disruption fears rattled software stocks last week, with names like $APP and $CSCO selling off sharply and dragging several Magnificent 7 names lower. As growth stocks struggled, capital rotated into defensive sectors, with $XLU leading the week. Outside of equities, Bitcoin continued consolidating near its 2021 highs around $69,000, while gold and silver finished largely unchanged. In other news:

• Coinbase Insider Selling
• AppLovin Freefall Begins
• VRT Gaps Higher
• HOOD Gets Hammered

Looking ahead, traders face a shortened week with markets closed Monday for Presidents’ Day. However, the advance Q4 2025 GDP estimate and the Fed’s preferred inflation gauge, PCE, will take center stage. With the major indexes compressing in a tight range, let’s dive into the charts.

Weekly Analysis

SPY (SPDR S&P 500)

SPY ended the week in the red at $681.75 (-1.28%), as its weekly Bollinger Band Width approaches its lowest level seen in nearly a year, indicating tightening price action. Despite persistent weakness in tech, price continues to find support at the middle band, suggesting the broader trend remains intact for now. With a multi-month squeeze in play, traders are watching closely to see which direction the compression ultimately resolves.

QQQ (Invesco QQQ Trust)

Tech remained under pressure last week, with QQQ closing at $601.92 (-1.27%). A weekly TTM Squeeze has been in play since November, marking the first such signal since the setup that preceded the early 2025 bear market. With $NVDA accounting for nearly 9% of the index and set to report earnings at the end of February, its results could be the primary catalyst that determines where price moves next.

IWM (iShares Russell 2000)

Small caps showed relative strength last week, with IWM closing down slightly at $262.96 (-0.78%). Its Bollinger Band Width is expanding rather than compressing, as the index pushes higher and builds on its ~6% year-to-date gain. With price continuing to test the upper Bollinger Band, traders are watching closely to see whether this leadership can persist or begin to fade.

Earnings

Notable Results

ROKU (Roku)

• EPS: $0.53 vs $0.28 est
• REV: $1.395B vs $1.352B est

SPOT (Spotify)

• EPS: $5.16 vs $2.95 est
• REV: $5.275B vs $5.160B est

RIVN (Rivian)

• EPS: $(0.54) vs $(0.81) est
• REV: $1.286B vs $1.262B est

CSCO (Cisco)

• EPS: $1.04 vs $0.94 est
• REV: $15.349B vs $15.122B est

BUD (Anheuser-Busch)

• EPS: $0.95 vs $0.89 est
• REV: $15.555B vs $15.491B est

HOOD (Robinhood)

• EPS: $0.66 vs $0.63 est
• REV: $1.283B vs $1.333B est

TMUS (T-Mobile)

• EPS: $2.14 vs $2.05 est
• REV: $24.334B vs $24.017B est

KO (Coca-Cola)

• EPS: $0.58 vs $0.56 est
• REV: $11.800B vs $12.050B est

ON (ON Semiconductor)

• EPS: $0.64 vs $0.62 est
• REV: $1.530B vs $1.534B est

MCD (McDonald’s)

• EPS: $3.12 vs $3.05 est
• REV: $7.009B vs $6.832B est

CBRE (CBRE Group)

• EPS: $2.73 vs $2.67 est
• REV: $11.629B vs $11.573B est

SHOP (Shopify)

• EPS: $0.48 vs $0.47 est
• REV: $3.672B vs $3.586B est

RACE (Ferrari)

• EPS: $2.49 vs $2.44 est
• REV: $2.098B vs $2.020B est

ABNB (Airbnb)

• EPS: $0.56 vs $0.66 est
• REV: $2.778B vs $2.715B est

COIN (Coinbase)

• EPS: $0.66 vs $1.05 est
• REV: $1.781B vs $1.842B est

What’s Happening Now

XLE SPDR Energy Sector
Energy is decoupling from other sectors with XLE currently charting multi-decade highs. Large caps XOM and CVX led the initial breakout, but now the sector is broadly energized. TPL, a large Permian land owner, leads YTD, followed by BKR which recently secured a deal to fuel U.S. data centers. As tech plots trillion-dollar buildouts for 2026, energy is a key input.

EEM MSCI Emerging Index
While SPY and QQQ are flat or negative YTD, markets outside of the U.S. have been surging. Like XLE, EEM has confirmed a significant breakout from multi-decade highs. Emerging markets such as EWY (South Korea), TUR (Turkey), and EWZ (Brazil) have led the trend, with global markets also supported by a weaker dollar and geopolitical volatility in the U.S.

Believe it or not, this is just a fraction of what happened in the markets last week. For a full rundown delivered straight to your inbox every weekend, sign up for The Official Trendspider Newsletter!