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Hans's Chart Room: Are We There Yet?
OPTIONS WITH HANS · CHART ROOM
The Market Paid the Spenders and Sold the Suppliers.
Wednesday, November 4, 2026 · Charts through today’s close
You’re reading the free Chart Room: five of today’s fourteen charts. If you want to trade a market like this with me in real time, that’s what Trader63, my VIP trade room, is for. Details are at the bottom.
Note From Hans
Democrats won control of both the House and the Senate in Tuesday’s midterms. Futures dipped overnight, buyers showed up before the open, and the S&P 500 closed up 1.58% at 7,688.62. The Dow jumped 3%, the Russell 2000 rose 1.4%, and 75% of S&P stocks finished higher, with 65 new highs and 3 new lows. Oil fell nearly 8% to about $88.59, the 10-year slipped to 4.89%, and the VIX dropped 20% to 16.61.
The interesting part was inside tech. The market is betting a new Congress puts the brakes on the AI buildout, and several data center ballot measures passed. So investors bought the companies doing the spending and sold the companies they buy from. Microsoft rose 6.7% to a record close, Amazon 6.1% and Alphabet 3.2%. Sandisk fell 7.9%, Micron and Western Digital about 7%, Super Micro 6%, and the chip ETF lost 2.8%. Energy fell 4.7% and defense stocks dropped. Solar jumped.
After the close, Qualcomm fell about 6%, Snap 9% and Arm another 3%.
Monday I said I’d stay more defensive until QQQ got back above 690. It closed at 691.95, back above it by less than two dollars, after holding its 200-day near 680. So the line held, barely. And the VIX buy signal fired this week, which is what you’d expect before a day like this.
Here’s how I read it. For weeks I’ve said the AI buildout is running into money and equipment walls. Today the market priced in a third wall, politics, and decided slower spending is good news for the spenders’ cash flow and bad news for everyone selling them chips, memory and power. That’s the AI trade deflating in a different place, not ending. I’m respecting the bounce in the mega-caps, but I’m still not chasing the suppliers, and I’m keeping my hedges with the jobs report on Friday.
THE INDEX
The S&P Bounced Back to the 50-Day
The S&P 500 rose 119.70 (+1.58%) to 7,688.62 after opening at its low (7,635.81) and reaching 7,715.57. It’s back above its 100-day (7,622.05) and just under its 50-day (7,692.97) and 20-day (7,700.12). The falling trendline from the 7,844.52 record is right overhead.
Hans’s take: Friday’s low (7,527.56) held inside the demand zone, and this is the bounce off it. Getting back above 7,700 and the trendline is the test. Options are pricing about a 0.7% move tomorrow.
TECH
QQQ Is Back Above 690
QQQ rose 6.67 (+0.97%) to 691.95. Monday’s low (680.33) held right at the 200-day (680.56). The 50-day (723.56) and 20-day (717.42) are well overhead.
Hans’s take: Above 700 is rotation. Below 690 is the correlation zone. We’re back above 690 by a hair, and the 200-day held. That buys time. It doesn’t end the correction. 700 is the next line I want back.
SMALL CAPS
Small Caps Are Testing the Top of the Range
IWM rose 4.23 (+1.51%) to 284.02 after reaching 286.17, back above its 50-day (282.99). It’s pushing into the supply zone near 286 to 289 that it stalled just under last week. The October low was 269.88.
Hans’s take: Small caps love lower rates and lower oil, and they got both. A close above 289 would be the first real breakout since the summer.
THE SPENDERS
Microsoft Closed at a Record
Microsoft jumped 34.81 (+6.68%) to 555.80, a record close above the 551.15 October high. Monday it closed below its 50-day (513.39). Two days later it’s 8% above it.
Hans’s take: Monday I called the 50-day break the most important chart in the letter. It lasted one day. The market thinks slower AI spending means more cash for shareholders, and Microsoft is the cleanest way to own that view.
THE SUPPLIERS
Chips Undercut the July Low
SMH fell 14.25 (−2.75%) to 504.27. The low (497.33) went below the July low (503.63) before it closed just above it. It’s below its 200-day (521.22) and inside the demand zone near 481 to 513.
Hans’s take: Chips are now the weak side of the trade. The bottom of the demand zone near 481 is the last real support before the spring breakout. I wouldn’t try to catch this one yet.
Still in the full Chart Room: nine more charts, including Amazon’s breakout, Alphabet, AMD, Sandisk, solar, credit, the 10-year, oil and the VIX, plus Tomorrow and Friday and The Through Line.
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Hans
Charts are end-of-day through Wednesday, November 4, 2026. Market data sourced from StockCharts.
This material is for educational and informational purposes only and is not a recommendation to buy or sell any security. Options carry risk and are not suitable for every investor.
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