Tech Sell-Off Deepens as Apple Faces Key Support Test

Wall Street heads into Tuesday’s session under pressure as investors reassess technology valuations, digest Apple’s latest earnings and prepare for a busy week of economic and political catalysts.

US equities finished Monday’s session mixed, with the S&P 500 declining 0.51% and the technology-heavy Nasdaq falling 1.07%, while the Dow Jones managed a 0.41% gain.

The divergence suggests investors are rotating away from technology rather than abandoning equities altogether. Concerns over the enormous cost of artificial intelligence infrastructure continue to weigh on sentiment, with markets increasingly questioning whether future returns can justify current investment levels.

Meanwhile, crude oil prices fell sharply on Monday as renewed hopes of US–Iran peace talks eased concerns over potential supply disruptions. Lower energy prices could help reduce inflationary pressures, although uncertainty surrounding negotiations means volatility may persist.

Apple Earnings Beat Fails to Remove Downside Concerns

Apple reported stronger-than-expected quarterly earnings on Monday, supported by robust demand for its iPhone 18 Pro lineup and higher selling prices.

However, investors remain concerned about rising memory-chip costs and their potential impact on future profitability. Despite strong iPhone demand, weaker performance in other business segments and expectations of lower gross margins have raised questions about the sustainability of earnings growth.

This leaves Apple facing an important test as investors weigh strong headline results against a potentially more challenging cost environment.

Apple Technical Outlook: Will Anchored VWAP Offer Support?

Apple’s daily chart shows price retreating from the upper boundary of an ascending channel following a sustained rally since the summer.

The supplied chart indicates a potential gap-down opening towards $323.50, bringing attention to the anchored volume-weighted average price (VWAP), drawn from the June lows and currently sitting near $320.44.

This area could provide an important initial support test, particularly if buyers begin defending the level following the opening sell-off.

A sustained break below the anchored VWAP would weaken the near-term bullish structure and increase the risk of a deeper correction towards the lower boundary of the ascending channel.

Conversely, a recovery above the gap-down opening area could indicate that buyers are beginning to absorb the selling pressure.

Today’s Focus: US Elections, Labour Data and AMD Earnings

Attention now turns towards Tuesday’s US midterm elections, alongside September’s JOLTS job openings report and factory orders data.

Investors will be looking for evidence of whether the US labour market remains resilient enough to support economic growth without encouraging further Federal Reserve tightening.

Later, Advanced Micro Devices’ (NASDAQ:AMD) quarterly earnings could provide another important test for technology sentiment. Its data-centre performance and forward guidance may offer insight into whether demand for AI infrastructure remains strong despite growing concerns over capital spending.

For now, Wall Street faces a delicate balance between resilient economic activity, elevated technology expectations and uncertainty over the path of US monetary policy. Apple’s reaction around its anchored VWAP could provide an early indication of whether buyers are prepared to defend the recent uptrend or whether further selling pressure lies ahead.

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