Technically Speaking – February

February 3, 2026

Long Term Resistance SP500:  7,010

Long Term Support SP500:   6550 then 6180

The S&P 500 ended January up about 1.4%. Historically, when the S&P finishes January positive, the markets end the year in positive territory 87% of the time. Will it happen again this year? We will just have to wait and see. The S&P hit over the long-awaited 7,000 mark for the first time ever at the end of the month and has since been hovering around that level. Usually, when we hit a big level, like 7,000, the markets tend to stick around that level for a bit. Investors seem to be cautiously optimistic, something we have been at Greenberg Financial for months now. This market is strong, but valuations have risen so quickly it would not be a surprise if we see a 5%-10% pullback at some point. If we do see this type of pullback, barring any black swan event, investors will most likely become more confident in valuations and resume buying. January and February tend to be strong months because of all the money flowing into the markets from new 401k contributions.

President Trump finally announced his new pick for the Charmain of the Federal Reserve. Kevin Warsh is President Trump’s selection. Kevin is a long-time economist and served as a Fed governor from 2006-2011. This choice was somewhat surprising, since Warsh’s views are more hawkish, which means he usually favors higher interest rates. This contrasts what President Trump believes. However, Warsh may change his tune in the market environment. Warsh favors Fed independence, which investors like to hear. Overall, Warsh seems to be a strong replacement for Powell.

The broad market has been outperforming the tech heavy NASDAQ to start the year, which means a rotation out of big tech and into other sectors. This is not too much of a surprise after watching tech dominate the markets over the last few years. We are still in the beginning stages of this artificial intelligence revolution and there will continue to be new companies that rise and current companies that fall. The idea is to invest in companies that are helping build the AI infrastructure and the companies that are continuing to innovate and grow with the revolution. We are going to continue to be cautiously optimistic as the markets rise. We are looking to take profits in sectors that have increased dramatically and rotate into other sectors that are beginning to surge. We are also holding some cash on the side in case of a pullback. If we see a pullback, that is when we will buy back into strong companies that have bright futures in this AI revolution.