Dow Futures Slips S&P 500 Reaches Uncharted Territory

Dow Jones futures edged lower early Wednesday, along with S&P 500 and Nasdaq futures, following a volatile trading session. Despite a late rally, tech giants like Meta (META) and Amazon (AMZN) struggled, while Axon Enterprise (AXON) broke out from a bullish chart pattern.

Market Overview

According  To Investor Business Daily:  The stock market saw a mixed performance on Tuesday. The S&P 500 hit a record high, rising 0.2%, while the Dow Jones Industrial Average edged higher. The Nasdaq gained less than 0.1%.

Despite the overall rally, Meta dropped 2.8%, ending a 20-session winning streak. Netflix (NFLX) lost 2.15%, while Amazon dipped below its 50-day line, closing 0.9% lower. On the other hand, Nvidia (NVDA) rose 0.4%, though it pulled back from intraday highs.

The small-cap Russell 2000 advanced 0.45%, just crossing its declining 50-day line. Meanwhile, the First Trust Nasdaq 100 Equal Weighted Index ETF (QQEW) gained 1%, reflecting strength in growth stocks.

Key Earnings Reports

Arista Networks (ANET) fell in extended trading despite exceeding earnings expectations, as its guidance only slightly beat estimates. Shift4 (FOUR) also dropped in after-hours trading after revenue and guidance disappointed investors.

In contrast, Axon Enterprise surged 3.9% to 710.01, clearing a cup-with-handle buy point at 689.54. However, its earnings report is due next week, which adds risk to the trade.

Nvidia’s Performance & Sector ETFs

Nvidia stock rose 0.4% to 139.40 after testing resistance at a trendline entry. The semiconductor giant has a base with a 153.13 buy point, though its pattern appears choppy. Nvidia’s earnings, due on Feb. 26, will be a key market mover.

Among sector ETFs, the iShares Expanded Tech-Software Sector ETF (IGV) rose 1%, while the VanEck Semiconductor ETF (SMH) gained 1.4%. Energy stocks performed well, with the Energy Select SPDR ETF (XLE) rising 1.4%.

Market Outlook & Strategy

The S&P 500 and Nasdaq are near record highs. If the market breaks out further, it could trigger new buying opportunities. Investors should remain patient and maintain updated watchlists to capitalize on potential rallies.

While Axon and other stocks presented entry points, waiting for stronger confirmation remains a prudent strategy. Monitoring key earnings and macroeconomic trends will be crucial in the coming sessions.