{"id":1224398,"date":"2026-02-05T11:16:49","date_gmt":"2026-02-05T09:16:49","guid":{"rendered":"https:\/\/www.etoro.com\/?p=1224398"},"modified":"2026-02-05T18:23:20","modified_gmt":"2026-02-05T16:23:20","slug":"software-slaughter","status":"publish","type":"post","link":"https:\/\/www.etoro.com\/en-us\/news-and-analysis\/the-daily-breakdown\/software-slaughter\/","title":{"rendered":"Software Slaughter"},"content":{"rendered":"

Software stocks are getting slaughtered…and so is silver and bitcoin. The Daily Breakdown jumps into the market chaos to see what’s moving.<\/p>\n

Before we dive in, let\u2019s make sure you\u2019re set to receive The Daily Breakdown each morning. <\/span><\/i>To keep getting our daily insights<\/i><\/b>, all you need to do is <\/span><\/i>log in<\/span><\/i><\/a> to your eToro account.<\/span><\/i><\/p>\n

What’s Happening?<\/b><\/h2>\n

Software stocks have been hit hard in recent weeks, with the Nasdaq Software Index falling for six straight sessions and dropping more than 12% over the past two days. Names like Microsoft<\/a>, Salesforce<\/a>, Adobe<\/a>, ServiceNow<\/a>, AppLovin<\/a>, and Shopify<\/a> have led the decline. The selling has also spread beyond software, pressuring firms like Booking Holdings<\/a>, Expedia<\/a>, S&P Global<\/a>, Moody\u2019s<\/a>, and Nasdaq<\/a>.\u00a0<\/span><\/p>\n

Software stocks are being decimated as worries permeate over whether AI will cannibalize their businesses. However, while the long-term implications are still somewhat unknown, many of these firms continue to generate solid earnings and revenue growth, and analyst expectations for these metrics continue to trend higher. Software stocks are likely nearing capitulation, however, the bigger long-term risk may be on valuation. Once this selloff is over and the stocks recover from their oversold condition, will there be a new ceiling on just how much investors are willing to pay for them?\u00a0<\/span><\/p>\n

The <\/span>IGV<\/span><\/a> ETF is the leading software ETF by AUM.\u00a0<\/span><\/p>\n

Crypto Tumble<\/b><\/h4>\n

Crypto is also sliding. Bulls\u2019 confidence is being tested as Bitcoin<\/a> teeters on the <\/span>key $70K to $75K zone<\/span><\/a>, with Ethereum<\/a>, XRP<\/a>, and others following. That\u2019s weighing on ETFs like <\/span>IBIT<\/span><\/a> and <\/span>ETHA<\/span><\/a>, but also on stocks like Strategy (which reports earnings today).<\/span><\/p>\n

Today\u2019s Events<\/b><\/h4>\n

On the calendar, today\u2019s 10 a.m. ET JOLTS report will update job openings, quits, and layoffs. Amazon<\/a>, Reddit<\/a>, Roblox<\/a> and others will report earnings tonight. <\/span><\/p>\n

Want to receive these insights straight to your inbox?<\/strong><\/p>\n

Sign up here<\/a><\/p>\n

The Setup \u2014 Staples<\/b><\/h2>\n

Rotation, rotation, rotation. While it feels like the floor is falling out in tech and crypto, other sectors in the market are doing just fine. For instance, look at consumer staples via the <\/span>XLP<\/span><\/a> ETF. The sector has hit new record highs each day this week and is being led by stocks like: Walmart<\/a>, Costco<\/a>, Procter & Gamble<\/a>, Coca-Cola<\/a>, and Philip Morris<\/a>.\u00a0<\/span><\/p>\n

\"Weekly
Chart as of the close on 2\/4\/2026. Source: eToro ProCharts, courtesy of TradingView.<\/em><\/figcaption><\/figure>\n

The XLP had been rangebound between $75 and $84 for almost two years, but this week\u2019s breakout has vaulted the ETF to new heights. From here, bulls want to see former resistance near $84 turn into ongoing support (remember, <\/span>role reversal<\/span><\/a>). Currently, the XLP is looking for its fifth straight weekly gain.\u00a0<\/span><\/p>\n

Options<\/b><\/h4>\n

For some investors, options could be one alternative to speculate on XLP. Remember, the risk for options buyers is tied to the premium paid for the option \u2014 and losing the premium is the full risk.\u00a0<\/span><\/p>\n

Bulls can utilize calls or call spreads to speculate on further upside, while bears can use puts or put spreads to speculate on the gains fizzling out and XLP rolling over. For those looking to learn more about options, consider visiting the <\/span>eToro Academy<\/span><\/a>.<\/span><\/p>\n

What Wall Street’s Watching<\/h2>\n

GOOG<\/b><\/a><\/p>\n

Shares of Alphabet<\/a> are in focus after the firm reported better-than-expected earnings and revenue expectations. Google Cloud exceeded analysts\u2019 estimates too, but the real shocker was management\u2019s CapEx guide. The company expects $175 billion to $185 billion in capital expenditures this year, well above the $119.5 billion consensus. Shares are down modestly this morning after the report. <\/span>Dig into the fundamentals for GOOG<\/span><\/a>.\u00a0<\/span><\/p>\n

QCOM<\/b><\/a><\/p>\n

Qualcomm stock is moving lower this morning, down almost 10% after the firm reported earnings. While Qualcomm beat on earnings and revenue expectations, the company\u2019s guidance fell short amid a global memory shortage. It expects adjusted EPS of $2.45 to $2.65 on revenue of $10.2 billion to $11.0 billion, versus analysts\u2019 forecasts of $2.89 in earnings per share on $11.11 billion in sales. <\/span>Check out the price targets for QCOM<\/span><\/a>.\u00a0<\/span><\/p>\n

Silver<\/b><\/a><\/p>\n

Volatility continues, with silver prices down more than 10% on Thursday morning. After last week\u2019s historical fall, silver prices rebounded back above $90 an ounce, but are now back under pressure. That volatility is also stemming to the <\/span>SLV<\/span><\/a> ETF, and to a lesser degree, is also being felt in gold<\/a> \u2014 which is down ~2% this morning \u2014 and the <\/span>GLD<\/span><\/a> ETF. <\/span>Check out the chart for SLV<\/span><\/a>. <\/span><\/p>\n

Disclaimer:<\/i><\/b><\/p>\n

Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.<\/i><\/b><\/p>\n","protected":false},"excerpt":{"rendered":"

Software stocks are getting slaughtered…and so is silver and bitcoin. The Daily Breakdown jumps into the market chaos to see what’s moving. Before we dive in, let\u2019s make sure you\u2019re set to receive The Daily Breakdown each morning. To keep getting our daily insights, all you need to do is log in to your eToro…<\/p>\n","protected":false},"author":130,"featured_media":819735,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[6894],"tags":[],"asset_type":[],"class_list":["post-1224398","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-daily-breakdown"],"acf":[],"yoast_head":"The Daily Breakdown: Software Slaughter<\/title>\n<meta name=\"description\" content=\"Software stocks are getting slaughtered...and so is silver and bitcoin. 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