Have you ever watched a market hover just below an all-time high and felt that electric tension in the air? That’s exactly where we are right now.
The S&P 500 spent all last week teasing a new record, closing Friday with its ninth positive day in ten. Everyone knows the Federal Reserve wraps up its final meeting of 2025 on Wednesday, and the futures market is pricing in an 87% chance of another quarter-point cut. But here’s the thing most retail investors miss: when the probability gets this high, the cut itself almost becomes background noise. The real fireworks will come from what the Fed says about 2026.
The One Level That Could Launch a Year-End Melt-Up
Seasoned floor traders are laser-focused on one number this week: 6,920 on the S&P 500.
Clear that on an intraday basis, and many believe the path is wide open toward 6,900–7,000 before New Year’s Eve. Fail to break it, and we could see a quick flush lower into the 6,700 zone where a ton of recent volume sits. It really is that binary in the very short term.
Why 6,920 specifically? It’s the exact high from earlier this month, and it lines up with the upper boundary of a multi-week ascending channel. In trader speak, it’s “overhead supply.” Break it cleanly and the algorithms start chasing, stops get triggered, and momentum players pile in. I’ve seen this movie before—when the broad market finally punches through a ceiling after ceiling in December, the moves can be viciously fast.
“When the odds of a rate cut are this baked in, the cut itself is almost irrelevant. It’s all about the tone of the press conference and any hints for next year.”
– Veteran NYSE market strategist
Oracle: From AI Darling to Whipping Boy (And Back?)
Few stocks have had a wilder 2025 than Oracle. The name skyrocketed 36% in a single day back in September after announcing massive cloud deals with OpenAI and others. Then reality set in—investors started worrying about the mountain of debt needed to fund all those data centers.
Since that peak near $346, the stock has been crushed more than 40%. Yet something interesting happened on the way down: shares have repeatedly bounced right around $210. That level has acted as rock-solid support all year and coincides with the 200-week moving average—about as “line in the sand” as it gets for longer-term holders.
Oracle reports fiscal second-quarter numbers after the close on Wednesday—the same day as the Fed decision. Talk about a perfect storm. If management can calm fears about leverage and show that the AI infrastructure deals are still ramping, a move back toward $250 isn’t crazy at all. On the flip side, any whiff of delayed spending from the hyperscalers and we could finally see that $210 level crack.
- Bull case trigger: Reaffirmation of $65–67 billion in remaining performance obligations
- Bear case trigger: Increased capex guidance with no revenue acceleration
- Technical line: Hold $210 and the long-term uptrend stays intact
Lululemon: Can It Finally Stop the Bleeding?
If you want a textbook example of a former market darling gone ice-cold, look no further than Lululemon. The stock is down more than 52% year-to-date and has dropped double-digits the last three straight quarters after reporting.
Here’s the hopeful part: the selling finally seems to be exhausting itself. Price has broken the steep downtrend line from the 2023 highs and is trying to put in a higher low. The 50-day moving average is curling higher around $173–175 and has provided dip-buying opportunities twice in the past month.
Thursday’s report is make-or-break. Beat on the top and bottom line with any sign that U.S. comparable sales are stabilizing, and a run toward $210 (and possibly $220–225) is absolutely in play. Another miss and we’re probably staring at a retest of the $150 zone from the summer.
Personally, I find the risk/reward intriguing here. The brand still has tremendous pricing power and international growth is legitimately strong. Sometimes the market just needs to be reminded.
Costco: The Silent Giant Everyone Stopped Talking About
Costco shares are actually down 13% over the past six months—pretty shocking for a name that rarely ever goes on sale. A classic topping pattern has formed with lower highs since the summer, and sentiment feels ice-cold.
The key level everyone will watch Thursday evening is $875. That’s both psychological support and the rising 200-day moving average. Hold there on any post-earnings weakness and the longer-term uptrend remains intact. Lose it and the chart starts looking a lot more concerning toward $800.
Costco has a habit of guiding conservatively and then crushing numbers all year. If they can deliver even modest positive commentary on membership fee trends or e-commerce penetration, dip buyers will probably show up in size.
Putting It All Together: My Personal Watchlist This Week
Here’s how I’m positioning heading into this gauntlet of catalysts:
- Long the S&P 500 as long as we stay above 6,750 (stop below there)
- Small long Oracle position with a hard stop under $208
- Willing to buy Lululemon on any dip to $173–175 if earnings aren’t disastrous
- Costco on the “buy list” only if $875 holds post-report
- Cash ready in case the Fed sounds unexpectedly hawkish for 2026
Look, no one has a crystal ball. But when you have this many overlapping catalysts—Fed decision, major earnings, and key technical levels all colliding in a 48-hour window—you pay attention. Some of the biggest moves of the year often come from weeks exactly like this one.
Whatever happens, trade your plan, respect your stops, and remember: the market doesn’t care what you or I think should happen. It only cares about what is happening.
See you on the other side of Wednesday.
