S&P 500: rallies are becoming fragile

<p>We continue to see the Nasdaq in correction mode, tech stocks are not doing well right when yields rally.  This sell off in tech stocks has affected the S&amp;P 500 but the Dow Jones and the FTSE 100 are doing better because these two indexes are not sensitive to tech stocks.  <br><br>The 10Y yield rallied near 1.8% it is difficult to know where the 10Y yield rally will stop.  Will it stop at 2% or 3% ? or higher? There is a wide range where the rally could end, the higher the more pressure on stocks and gold. My guess is that it will top between 2% and 2.5%, yields are back where they were at the start of the pandemic, I don’t think they will go much higher, not above 3.2% which is the 2018 high.<br><br>The sell off in tech stocks has pushed the S&amp;P 500 below a key support, the pattern has changed it is no longer an ending diagonal.  It could be a larger correction, I still believe the rally is not complete because the latest rally is in three waves and not in five. <br><br>Observe the correlation between the 10Y yield and the S&amp;P 500, as yields rise the index goes down.  When the index goes down yields go down and this triggers a rally in the S&amp;P 500.  But yields will rally again and the rally in the S&amp;P 500 will run out of steam.  A new cycle starts, each time the S&amp;P rallies to new highs a sharp sell off follows.</p>