EssKay

Let it play out or stop out, don't bail out.

[EssKay @EssKayOne]

Breakouts in bad markets look as good as breakouts in good markets; the only difference is what happens after breakouts. In a bad market, even good breakouts fail.

-Pradeep Bonde

[EssKay @EssKayOne]

🔴 Market Signal flipped to RISK OFF. // Yesterday saw hard gap downs followed by oversold bounces from deep levels. Indices reclaimed their 50MA. Software, which held up very well during the current pullback, produced some nice range expansions. VIX pulled back but stays elevated at 16. World markets are near their 200MA. The US is supporting the global picture; without it the view is weaker. // Yesterday's bounce was mainly short covering. $SOXX dropped 17% in seven days. Money rotated into bonds as $TNX collapsed and defensive names. The 9-million scan returned only about 100 names, well below levels seen when larger capital returns. This does not look like a durable bottom. // Scenarios: 1. Stealth bear market ends and the it rebounds. Pro: Breadth (T2108) is improving, rates are falling, and software is showing relative strength. >>> Next days confirmation needs stronger breadth thrusts and a follow-through day. 2. Chop continues. Nothing fundamental has changed and also $TSM earnings failed to spark semis. >>> This path holds if breadth stays weak and range expansions get no follow-through. 3. Bounce extends a few days then fails as nothing fundamental changed except PPI also shows inflation pressure. >>> Next days price pushes higher without real breadth improvement, setting up bear flags before the next decline. // Default remains cautious with SOH as the base stance. Next 1-3 days tilt is bullish. Held the $SOXL bounce play from yesterday. Open to HVBO with a catalyst today using 80/20 profit taking. Take it day by day from here.

1. The stock market staged an impressive recovery from early losses on Thursday, with broad buying helping the major averages finish higher despite continued technology weakness. The $SPX (+0.3%), $NDX (+0.1%), and $DJIA (+1.1%) all ended positive after a difficult start. // Health care (+1.8%) and financials (+1.4%) led, while consumer discretionary (+1.2%) also outperformed; information technology (-0.5%) recovered from an early nearly 2% drop and energy (-1.6%) lagged despite higher oil. // The PHLX Semiconductor Index fell as much as 4.4% before finishing just 0.9% lower as bargain hunting emerged. $TSM’s beat and raised guidance failed to lift the group, while $DELL and $HPE remained the S&P 500’s worst performers. $CRWV reversed sharply higher after a report that Jensen Huang said its financial position is improving, and $NKE rebounded 5.2% from 52-week lows. Oil settled +3.0% at $97.92. // The Equal Weight Index jumped 1.3%, substantially outperforming the cap-weighted $SPX, while the Russell 2000 (+1.4%) and Mid Cap 400 (+1.0%) also outperformed. The home-construction ETF gained 4.0% as yields fell sharply. // Hotter PPI showed headline producer inflation accelerating to 6.3% year-over-year, but retail sales jumped a strong 0.8% and claims stayed low at 199K. The 2-year yield settled down 5 bps to 4.75% and the 10-year yield fell 10 bps to 5.09%.

2. Bullish breadth thrust with almost 500 stocks up. // All breadth ratios remain bearish. However, clear improvement across all ratios compared to yesterday. // 20s bearish count is down 1/3 over yesterday and bullish count nearly doubled. Yet it still remains in bearish extremes. So likely more fuel ahead in the bounce. // T2108 made a big jump and is at 31. Nearly double from its low 2 weeks ago. // VIX is down from yesterday at still a low 16 reading but remains in high volatility territory. // As expected Market Signal has switched to RISK OFF.

3. EOD: $AAOI, $CRWV, $IONQ, $JOBY, $KLAC, $LITE, $MU, $NOW, $PANW, $PATH, $SNDK, $SOXL. ANTS: $PENG. SWINGS: $SOXL. EP: none.

[EssKay @EssKayOne]

🟠 Market Signal is still CAUTIOUSLY BULLISH only technically. It flips to RISK OFF with one more day. Longer-term breadth is near extremes but not extreme yet. // The theme has changed. Good AI earnings no longer work unless they beat high expectations. Future big-company AI deal news also fails. Yesterday’s AI bounce attempt failed. AI needs cheap money and cheap energy; both are getting more expensive. // $SOXX and $SNDK topped in June and made a lower high. The likely path is a test of the range lows, then a check for a higher low. Setup time is needed, but support tests should offer good trades. // All other bull-market themes are already in bear markets. Only Mag 7 $MAGS is still holding up -as money hides here for now. The one positive today: $TNX spiked then sold off to close lower. // A VIX spike and extreme NAAIM readings are needed before things improve in the medium to longer term. Until then, expect bearish chop. Look for support bounces or U&R setups for swings. Default is SOH. Earnings plays also need new themes or they will likely fail.

1. The stock market finished broadly lower on Wednesday as accelerating inflation raised Fed policy concerns and persistent weakness in semiconductor and technology stocks weighed on the major averages. The $NDX (-1.9%) suffered the steepest decline, followed by the $SPX (-1.1%), while the $DJIA (-0.1%) finished with a relatively modest loss. // Information technology (-2.6%) finished at the bottom, with communication services (-1.7%) and consumer discretionary (-1.1%) also lagging; health care (+2.5%) and consumer staples (+2.4%) led as defensive names attracted buying. // The PHLX Semiconductor Index plunged 4.3% and the Mega Cap Growth ETF fell 2.1%. $CRWV dropped 15.5% amid debt-distress concerns, while $DELL and $HPE sold off after Barclays downgrades. $BAC fell 4.7% after weaker trading and investment-banking revenue, while $UNH, $MRK, $WMT, and $KO supported the DJIA. Oil settled +1.1% at $95.11. // The $SPX briefly fell below 7,700 and its 50-day moving average. The Russell 2000 (-1.9%) and Mid Cap 400 (-1.3%) underperformed. The recovery in Treasury yields provided little relief for growth stocks, leaving all three major averages negative for the week. // September CPI accelerated to 3.7% headline and 2.6% core year-over-year, pushing the FedWatch probability of an October hike near 50% before it moderated. The 2-year yield settled up 1 bp to 4.80% and the 10-year yield finished down 3 bps to 5.19%.

2. Extreme bearish breadth thrust to the downside with nearly 800 stocks down. // All breadth ratios bearish. The longer term ratios nearing extreme levels. // Strangely the 20s bullish count actually went up from yesterday. Nevertheless it is now in bearish extremes. // T2108 is at 25. // VIX only up 10% to below 17 and now in a high volatility state. Yet it needs to go higher. Still no real fear visible here. // Indices switched from uptrend into a transitional state. // Market Signal remains on CAUTIOUSLY BULLISH but this is just a technicality. It needs one more day to switch to RISK OFF.

3. EOD: none. ANTS: $CRWV, $FLEX, $KLAC, $MU, $PANW, $SNDK, $SOXL, $UVIX. SWINGS: none. EP: none.

[EssKay @EssKayOne]

🟠 Market Signal CAUTIOUSLY BULLISH. // Lots of nice bounces off support level in AI names. The only good looking charts are in energy. Rotation still in full swing. // $ASML announced good earnings and stock got sold off and toward the end of session closed slightly positive. So far all earnings in AI names have not really had a positive impact. // Also KOSPI closed slightly down over in Korea after an initial bounce. Both events likely mean choppy to bearish action today in the US in semis in memory. Plus CPI data Incoming. // Also yesterday's earnings were sell the gap situations. The best thing here would be really a clearing, harsh sell off but likely choppy action to continue. // Unfortunately on my end no clear focus yesterday on AI support bounces. This chance was missed. // Today default action is SOH unless HVBO with outstanding catalyst.

1. The major averages finished Tuesday with modest changes, recovering from more pronounced intraday weakness as a late improvement in semiconductor stocks helped stabilize the market. The $SPX ended flat while the $NDX (-0.2%) and $DJIA (-0.4%) registered small losses. // Five sectors closed higher. Energy (+1.8%) led and communication services (+0.9%) also outperformed; health care (-1.3%) finished with the largest decline while industrials (-0.3%) and financials (-0.4%) lagged. // The PHLX Semiconductor Index fell as much as 3.1% before recovering to finish -0.2%, with $MU still down 3.6%. $MPC and $VLO reached record highs as refiners led energy, and $META gained 2.6%. $JNJ dropped 5.7% after disappointing MedTech growth overshadowed its Q3 results, and $CAT continued its retreat. Bank reactions were mixed, with $C down 5.6%. Oil settled +0.3% at $94.06. // The Russell 2000 (-0.4%) trailed while the Mid Cap 400 (+0.1%) managed a slight gain. Axios reported that Netanyahu and President Trump discussed possible renewed strikes on Iran, though Trump indicated he would not authorize additional strikes before the midterms. // Existing home sales rose 1.5% to 3.99 million but were down 2.2% year-over-year, making August and September the slowest months of 2026. The 2-year yield finished unchanged at 4.79% and the 10-year yield settled down 2 bps to 5.22%.

2. Another severe breakdown day with more than 400 stocks down. // Breadth ratios keep deteriorating and remain bearish yet still not in very extremes. // 20s bullish count is very low and leans to the bearish side. Yet also here no real extreme yet. // On the other hand T2108 keeps improving and is even up again at 29. Also T2118 has now made "the hook" and is over its declining 10MA — usually an indication of good things to come. // VIX is basically unchanged at around 15. No fear in the market and mixed picture on breadth side. // Market Signal CAUTIOUSLY BULLISH.

3.EOD: $AEHR, $AMD, $CRDO, $GLW, $MRVL, $NBIS, $SKHY, $SNDK, $SOXX, $STX, $VG. ANTS: $BTSG, $FOSL, $PLTR, $SB. SWINGS: none. EP: none.

[EssKay @EssKayOne]

🟠 Market Signal remains CAUTIOUSLY BULLISH. // Solid breakdown day with very poor overall breadth, though some early signs of stabilization are appearing. AI names continue to pull back while rotation into value and healthcare remains ongoing. Conditions are fluid — stay open to either direction. // As of this writing, Korea is gapping down and continuing to fall, with a circuit breaker possible during the session. Expect a bearish and volatile session in the US today especially for semi and tech names. // Action: AI pullbacks have gone too deep and need time to consolidate. Default stance is SOH. An obvious bounce at key levels can be considered for a day trade (80/20), or an HVBO with an exceptionally solid catalyst at half risk only.

1. The stock market is showing mixed results at midday on Monday, with continued weakness in semiconductor and other technology stocks offsetting gains across most of the broader market. The $SPX (-0.1%) is hovering near unchanged, the $NDX (-0.4%) trails, and the $DJIA (+0.4%) outperforms. // Nine S&P 500 sectors are higher despite the lackluster major averages. Information technology (-0.8%) is the primary drag while communication services (+1.5%) and energy (+1.5%) lead; consumer discretionary (-0.6%) is among the laggards. // The PHLX Semiconductor Index is down 2.2%, with $NVDA (-1.3%), $MU (-3.2%), and $SNDK (-6.0%) pressured after a report that China’s CXMT plans next-generation memory chips. $LITE and $CIEN are also sharply lower. $META (+4.0%) is a standout on a report that Mark Zuckerberg hinted at a new “Watermelon” AI model, while $AAPL is higher. Oil is up 2.0% to $93.71 on Saudi-Houthi escalation, and $AMZN is lower on reports of a roughly $7 billion deal for AI startup Decart. // The Russell 2000 (-0.2%) and Mid Cap 400 (-0.1%) are modestly lower. Advancers hold a slim edge on the NYSE while decliners lead 3-to-2 on the Nasdaq. President Trump has indicated the U.S. could become involved in the Saudi-Houthi conflict. // There is no economic data of note today. Investors are looking ahead to a busy week of bank earnings for a clearer picture of growth and the broader outlook.

2.Clear breakdown day with more than 350 stocks down. // All breadth ratios bearish. 20s neutral and tilted to the bearish side. However, T2108 even up compared to Friday's close. T2118 makes a "hook" from extreme oversold level. The last 2 times it was there was at the bottom of the 2022 bear market and the Oct 2023 pullback. So usually a sign of very good things to come. Yet, breadth remains overall mixed picture. // Market Signal remains CAUTIOUSLY BULLISH.

3. EOD: $CHA. ANTS: $BTSG, $MRVL, $SB, $STX. SWINGS: none. EP: none.

[EssKay @EssKayOne]

🟠 Market Signal remains CAUTIOUSLY BULLISH. // After four positive weeks, both Nasdaq indices formed weekly reversal candles at new weekly ATHs. $SPX showed weekly range expansion, while small-caps $IWM and mid-caps $MDY managed to close above the 40-week MA after weeks of decline. // Semis supported the market for weeks but closed at the LOW. Rotation appeared elsewhere, with range expansion in value $VTV, software $IGV and healthcare $XLV and $XBI on Friday. // Rates $TNX failed at the highs and reversed to close negative at the LOW. World stocks $VT have gone sideways for four weeks with almost no net change. // T2108 shows a second week of bounce. Breadth ratios remain bearish, though the McClellan Oscillator is turning. // Rotation continues and major index charts look healthy. Seasonality favors upside. The medium-term picture leans bullish, but near-term conditions stay choppy and rotational. A decisive breadth thrust is needed; otherwise range-bound action continues. // This week’s key event is Wednesday’s September CPI, which will shape expectations for the Fed’s October decision. // Earnings season begins. Lots of neglected stocks raise the odds of catching good EPs. //Action: Focus remains on buying support in leading AI stocks that pulled back recently, plus HVBO with catalysts.

Key economic news for this week: Mon – no major reports; Tue – NFIB Optimism Index, Existing Home Sales, Federal Budget; Wed – CPI, Core CPI, Fed Beige Book; Thu – Empire State Survey, Retail Sales, Philly Fed manu. survey, Jobless Claims, PPI, Core PPI, Business Inventories, several FED heads speaking; Fri – Import Prices, Industrial Production, Capacity Utilization.

1. This week, the stock market finished higher, supported by broader market leadership that offset weakness in semiconductor and AI-related stocks. The S&P 500 gained 1.2%, the DJIA advanced 0.9%, and the Nasdaq Composite rose 0.6%. The Russell 2000 fell 0.9% and the S&P Mid Cap 400 finished unchanged, while the S&P 500 Equal Weighted Index rose 1.6%. Consumer staples gained 4.0%, utilities 3.9%, energy 3.6%, consumer discretionary 3.1%, health care 2.8%, and financials 2.3%. Information technology slipped 0.3% and the PHLX Semiconductor Index declined 4.3%, while the Vanguard Mega Cap Growth ETF rose 0.8%. The 10-year Treasury yield finished 4 basis points lower at 5.24% and the 2-year yield declined 3 basis points to 4.79%. WTI crude finished just under $1 per barrel higher.

On Friday, the stock market finished broadly higher, with the S&P 500 rising 0.6%, the Nasdaq Composite 0.6%, and the DJIA 0.9%. The Russell 2000 and S&P Mid Cap 400 each gained 0.5%. Real estate led with a 1.9% advance, driven by $CCI (+15.60%) after $SPCX (+1.25%) agreed to acquire spectrum. Communication services fell 0.4% as $TMUS dropped 13.27% and $T declined 9.85%. Consumer discretionary rose 1.7%, with $TSLA up 2.05% and $AMZN up 3.29%. Health care gained 1.6%, led by $HUM (+11.34%) and $MRNA (+14.21%). Information technology rose 0.4% but the PHLX Semiconductor Index fell 0.4%. $AAPL declined 1.10% and $SWKS fell 5.45%, while $PLTR rose 5.17%. Energy slipped 0.2% as crude settled up 0.5% at $91.92. The 2-year Treasury yield rose 3 basis points to 4.79% and the 10-year yield rose 1 basis point to 5.24%. The preliminary October University of Michigan Consumer Sentiment Index fell to 46.3.

2. Light breakout day with just more than 150 stocks up. // All breadth ratios bearish. // 20s tilt to bullish side with a neutral reading. // T2108 improved and is back into bullish territory. // VIX down 5% and below 15. // Professionals reduced their position slightly down to 83 with a neutral reading. // Market Signal remains CAUTIOUSLY BULLISH.

3. EOD: $CCC, $DDOG, $IGV, $NU, $STNE, $XBI, $XLV. ANTS: $ALAB, $BTSG, $CRDO, $LRCX, $MRVL, $NOW, $SOXL, $STX, $VIAV. SWINGS: none. EP: none.

[EssKay @EssKayOne]

🟠 Market Signal remains CAUTIOUSLY BULLISH. // Rotation is in full swing: semis and tech, which had been carrying the market, reversed hard, while bottom-bounce setups are appearing in value names. Falling rates $TNX support that shift. // Major indices are retesting recent pivots. Small caps $IWM and mid caps $MDY are holding above their 200MA. // This can resolve into a broader rally or a flush lower. Stay open. // For now, wait for leaders to test support and buy the hold, or take HVBO with catalysts. Otherwise SOH.

1. Thursday ended with a notable divergence as a sharp semiconductor selloff kept the $SPX (-0.5%) and $NDX (-1.3%) firmly lower despite improving participation elsewhere. The $DJIA (+0.1%) finished slightly higher while the Russell 2000 ended flat and the Mid Cap 400 (+0.4%) outperformed. // Six sectors finished higher, led by energy (+2.9%) and consumer staples (+2.1%); information technology (-1.8%) finished at the bottom and consumer discretionary fell 0.5%. // A Financial Times report that OpenAI’s annualized revenue is running $20 billion below earlier estimates intensified AI selling, leaving the PHLX Semiconductor Index down 3.4%. $NVDA fell 2.9% and $GLW dropped 6.4%, while $AMZN lagged and the Mega Cap Growth ETF fell 1.3%. $CMG rallied 6.1% on a report that $SBUX had explored a takeover, and $PEP gained 4.2% after a beat despite a lower FY26 outlook. // Oil climbed more than 5% on escalating Hormuz tanker attacks before settling +3.7% at $91.47 after President Trump said talks with Iran were productive and no further strikes were planned before the November 3 midterms. NYSE breadth flipped to an 8-to-5 advancer lead, but Nasdaq participation stayed negative as losses concentrated in technology. // Initial claims fell to 197K, still consistent with low layoff activity. Treasuries recovered, with the 2-year yield down 1 bp to 4.76% and the 10-year yield down 5 bps to 5.23% after touching 5.35%.

2.Another breakdown day with close to 300 stocks down. // All breadth ratios bearish. // 20s with slight tilt to bullish side but fully neutral. // T2108 actually up 10% to 23. // VIX up only 3% to a low reading of about 16. // Market Signal remains CAUTIOUSLY BULLISH.

3. EOD: $ACN, $BROS, $CTSH, $MAX, $SECZ, $Z. ANTS: $ALAB, $AXTI, $CRCL, $CRDO, $INTC, $LRCX, $META, $UVIX. SWINGS: none. EP: none.

[EssKay @EssKayOne]

🟠 Market Signal remains CAUTIOUSLY BULLISH. // Indices gapped down and the dip was bought in the large caps. Small caps $IWM and mid caps $MDY are back at their 200MA. // The good: many breakouts retested recent pivot points and held. That was a successful retest. The miss was not taking the reversals yesterday, even though several set up cleanly. // The bad: yesterday wiped out the prior four-day bounce in most stocks. AI names are still holding the market up, but peak-earnings tone is showing up in names like $MU and $SNDK. // Rates and oil keep pushing higher, and the Fed is likely to hike once more this year. The backdrop is not supportive. Breakouts are unlikely to work. Expect the chop to continue. // Action: stay with reversal plays. That has been the productive setup over the past few weeks.

1. Wednesday ended with modest losses for the major averages, but the mild index declines understated considerably weaker performance across the broader market. The $SPX (-0.2%) and $NDX (-0.2%) recovered from steeper morning losses to finish near their best levels, while the $DJIA (-0.7%) remained a laggard. // Health care (+1.1%) led and consumer discretionary (+0.2%) reversed an earlier loss; industrials (-2.1%) was the weakest sector, followed by materials (-1.5%) and real estate (-1.3%), while information technology narrowed its decline to 0.1%. // The recovery was concentrated in mega-caps as $AAPL and $AMZN gained and the PHLX Semiconductor Index cut a steeper drop to finish -1.2%, with $MU (+4.1%) and $SNDK bucking the weakness. $CAT fell 5.8% amid FTC and USDA scrutiny of agricultural equipment, $SPCX dropped 2.5% after reports it is seeking $40 billion to buy $NVDA chips, and $LLY and $MRNA supported health care. // The Russell 2000 (-1.3%) and Mid Cap 400 (-1.6%) stayed near session lows, and the home-construction ETF fell 2.6%. FOMC minutes showed most policymakers see a high likelihood of another rate hike by year-end. // MBA mortgage applications fell 4.2% and August consumer credit rose a lighter-than-expected $8.3 billion. Treasuries recovered from early losses, with the 2-year yield down 2 bps to 4.77% and the 10-year yield up 1 bp to 5.28% after touching 5.36%.

2.Breakdown day with close to 300 stocks down. // All breadth ratios bearish. // 20s in neutral with a tilt to the bullish side. Bullish count only dropped little. // VIX basically unchanged. // Market Signal remains CAUTIOUSLY BULLISH.

3. EOD: $ALAB, $GKOS, $LRCX, $MU, $SNDK, $SOXL. ANTS: $CRCL, $CRDO. $NVDA. SWINGS: $SNDK, $SOXL. EP: $QMCO.

[EssKay @EssKayOne]

🟠 Market Signal CAUTIOUSLY BULLISH. // Remains a choppy market. Poor action on range expansions. Even though indices are at ATHs. // The bounce has now played 4 days with some gap ups. Yesterday showed some reversal candles. The bounce might have played out now. // Likely choppy to bearish action the next few days. // Today FOMC meeting minutes out. Don't think it matters much though. // Anyways, default action is SOH. If so, only willing to take bounces from support levels or HVBO with clear catalyst.

1. Tuesday produced another solid advance as broad participation and lower Treasury yields helped the $SPX (+0.6%) reach its first record high since August 13 and close above 7,800 for the first time. The $NDX (+0.5%) set fresh record highs and the $DJIA (+0.5%) posted a comparable gain, though the averages finished well off their best levels. // Ten of 11 sectors finished higher. Utilities (+3.0%) led on nuclear-power deals, while consumer discretionary (+1.4%), real estate (+1.1%), and consumer staples (+1.0%) also stood out; health care (-0.2%) was the lone decliner. // $CEG surged 12.3% after a 20-year power deal with $GOOG for 890 MW of nuclear capacity, lifting $VST and $NRG. $MRVL jumped 5.8% after raising its FY28 revenue outlook to $20 billion, $AMD gained 2.8% on plans to increase 2027 AI supply, and $CIEN and $GLW rallied on optical demand. $STX and $WDC sold off on a bidding contest for TDK’s magnetic-head business, and $MRNA fell 7.8%. Oil settled little changed at $89.44 after briefly dropping below $87. // The Mid Cap 400 (+0.6%) participated while the Russell 2000 (-0.6%) lagged after giving back an early gain. Iran increased attacks on ships in the Strait of Hormuz as shipments approached pre-war levels, but lower yields helped broaden the advance ahead of earnings season. // The August trade deficit widened to $105.6 billion on stronger crude and semiconductor flows. The 2-year yield settled down 4 bps to 4.79% and the 10-year yield fell 4 bps to 5.27%.

2. Light breakdown day with more than 200 stocks down. // Breadth ratios remain bearish. // T2108 crossed back to bullish. // 20s are neutral with a strong bullish tilt. // Overall no clear indication. Mixed signals. // Market Signal CAUTIOUSLY BULLISH.

3. EOD: $ANET, $NOK, $PENG, $XLU. ANTS: $INTC, $MU, $SNDK. SWINGS: $NBIS, $SNDK, $SOXL. EP: $QMCO.

[EssKay @EssKayOne]

🟠 Market Signal switched to CAUTIOUSLY BULLISH. // The bounce off the 200MAs in small $IWM and mid caps $MDY played out. However, breadth is still nothing to write home about. // Interesting though rates $TNX went up the past two days yet market kept bouncing. // Mag 7 $MAGS and Nasdaq at new all time closing highs. // Lots of Brazil and Russian virus related moves today. // Picture on follow through on range expansions remains mixed. // Action: Stick to AI themed stocks and better to buy bounce off support then range expansions. // Expect choppy conditions to persist. Bounce might go on for another one or two days.

1. The stock market had a productive first session of the week as early tech leadership stayed solid and participation broadened considerably. The $NDX (+1.1%) set fresh record highs, the $SPX (+0.7%) notched a solid gain, and the $DJIA (+0.2%) reversed early weakness to finish just off session highs. // Ten of 11 S&P 500 sectors finished higher, with communication services (+1.1%) and information technology (+0.7%) near the top; real estate (-0.4%) was the lone decliner and industrials (+0.1%) lagged. // $META (+1.9%) extended its Muse-driven run, software gained 1.3% as $PTC surged 33.5% on a $205 cash buyout by Schneider Electric, and $MSFT rose after an upgrade. The PHLX Semiconductor Index added just 0.3%, with $NVDA (+2.1%) and $TSM (+2.8%) higher after Musk discussed possible TSM involvement in Terafab’s Texas project, weighing on $INTC. $SPCX jumped 7.6% while $CHRW fell 10.9% after agreeing to acquire $RXO. // The Equal Weight Index recovered to +0.5%, nearly matching the cap-weighted $SPX and ending a seven-week losing streak, while the Russell 2000 (+0.5%) and Mid Cap 400 (+0.4%) also advanced. Oil fell 1.9% to $89.33 on improved Middle East export flows even as U.S.-Iran diplomacy stalled, and equities shrugged off higher yields. // ISM Non-Manufacturing eased to 54.9% but prices paid kept rising, feeding pass-through concerns. The 2-year yield settled up 1 bp to 4.83% and the 10-year yield rose 3 bps to 5.31%.

2. Breakout day with over 250 stocks up. // Breadth slowly grinding higher short term. All breadth ratios remain bearish though. // T2108 no longer at extreme levels. Made quite a bounce in the past 3 days. // 20s are now solidly bullish. // Market Signal switched to CAUTIOUSLY BULLISH.

3. EOD: $ARKG, $ASO, $CBRS, $CPNG, $HTFL, $NVAX, $TEM. ANTS: $MU, $NBIS, $OMER, $SNDK. SWINGS: $NBIS, $SOXL. EP: $QMCO.

[EssKay @EssKayOne]

🔴 Market Signal: RISK OFF. // Indices are at all-time highs, but breadth stays weak. Friday’s advance came on low volume and unimpressive participation. // Memory names failed to follow through on strong $MU earnings, and several semis are reversing. Conditions look set to stay choppy. // Main event: Wednesday’s FOMC minutes (Sept 15–16 meeting, 2:00 p.m. ET). They can clarify the policy path and shift rate expectations. Thursday’s jobless claims are the secondary release. // Action: focus on bounce plays.

1. This week, the major averages finished mixed as elevated Treasury yields pressured much of the market, while semiconductor and technology strength limited the damage. The S&P 500 slipped 0.3% and the DJIA fell 1.3%, while the Nasdaq Composite gained 0.5%. The Russell 2000 declined 0.2% and the S&P Mid Cap 400 rose 0.5%. The 10-year yield climbed 10 basis points to 5.28%, its high for the year, even as October rate-hike odds faded after dovish remarks from New York Fed President John Williams, cooler-than-expected August PCE and core PCE readings, patient comments from Fed Vice Chair Phillip Jefferson, and a weak September jobs report. Information technology gained 1.4% and the PHLX Semiconductor Index rose 3.7%, helping the Nasdaq finish as the only major average with a weekly gain. The Vanguard Mega Cap Growth ETF ($MGK) added 0.3%. The equal-weighted S&P 500 fell 0.7%, and eight of 11 sectors declined, led by health care (-2.7%) and financials (-2.5%), with consumer staples and real estate each down 1.9%. The iShares U.S. Home Construction ETF dropped 3.1%. WTI crude finished roughly 1.5% lower amid U.S.-Iran and Strait of Hormuz headlines, though energy still gained 1.4%.

On Friday, the major averages finished firmly higher after a soft jobs report and lower crude oil, with the S&P 500 up 0.7%, the Nasdaq Composite up 1.2%, and the DJIA up 0.5%. The Russell 2000 rose 0.9% and the S&P Mid Cap 400 gained 1.0%. Nonfarm payrolls rose just 29,000 versus a 100,000 consensus, unemployment ticked up to 4.2%, and average hourly earnings increased 0.1%. A coordinated G7 release of 100 million barrels through the IEA pushed WTI down 2.1% to $91.10. All 11 S&P 500 sectors finished flat or higher, led by consumer discretionary (+1.4%) on $TSLA (+4.65%) after Q3 deliveries of 486,532 topped the 461,974 consensus. Information technology gained 1.1% and the PHLX Semiconductor Index rose 2.4%, with $NVDA up 1.34% and $MGK up 1.0%. $SPCX gained 7.35%. $NKE fell 3.57% on a weak FY27 outlook, while $WDC and $STX each dropped about 10.2% after Toshiba announced expanded HDD production. Health care and financials were flat. The equal-weighted S&P 500 rose 0.4%, trailing the cap-weighted index. The 2-year yield settled at 4.82% and the 10-year at 5.28%.

Key economic news for this week: Mon – Services PMI, ISM Services; Tue – Trade Balance, FED head speech; Wed – FOMC Minutes, Consumer Credit; Thu – Jobless Claims, Wholesale Inventories, FED head speech; Fri – FED head speech, Consumer Sentiment.

2. Another unimpressive breadth day with more than 200 stocks up and less than 150 down. // All breadth ratios bearish. // 20s neutral with a tilt to the bearish side. // NAAIM shows professionals slightly reduced exposure and are at 85% invested which is a neutral reading. // T2108 is back above 20 and closes the week at 21. Its weekly low was below 15, an area from where most bounces in a bull market started. // Market Signal RISK OFF.

3. EOD: $ALGM, $FPS, $MXL, $SPCX, $STX. ANTS: $ALAB, $META, $NBIS, $OMER, $SIMO, $STAA. SWINGS: $SOXL. EP: $AMD, $QMCO.

[EssKay @EssKayOne]

🔴 Market Signal RISK OFF. // MA U&R in $MDY and $IWM bounce off the 200MA. // $SPX puts in reversal candle and $IXIC and $NDX keep consolidating over the 10MA. // Semis $SOXL see range expansion after testing support at yesterday's lows. // $MU tested its range and put in a U&R. Should be off to the races now but likely retest of last few days range highs. // Expect bounce in the next few days and breakouts to work. // Action: today's focus is on $MU, $AMD and $ALAB.

1. The major averages recovered from a broad morning retreat on Thursday as a sharp reversal in Treasury yields helped stocks regain their footing, with strength in technology, semiconductors, and other AI-related names adding support. The $SPX (+0.2%) finished modestly higher while the $NDX and $DJIA ended flat. // Energy (+1.9%) led the standings while industrials (+1.0%), information technology (+0.8%), and utilities (+0.6%) also finished higher; communication services (-1.2%) and health care (-1.3%) were the clear laggards as five sectors closed in positive territory. // The PHLX Semiconductor Index gained 1.6% as $MU (+3.0%) reversed an early post-earnings decline after a beat and strong guidance on AI-driven memory demand. $ACN surged 16.0% after stronger bookings increased confidence that AI is a growth driver, and $SNPS jumped 12.8% after its Investor Day. $GOOG fell 1.7% after reversing an opening gain tied to Gemini 4 Argon, while $PSKY dropped 9.6% as its merger with $WBD is expected to close October 6. Oil rose 2.7% to $93.02. // The Russell 2000 (+0.5%) and S&P Mid Cap 400 (+1.1%) rebounded from morning losses and outperformed, marking a notable improvement in participation. Fed Vice Chair Jefferson said policy adjustments may take more time, lifting the FedWatch probability of an October hold to 76.2% from 62.4%. // Initial claims stayed low at 197K and ISM Manufacturing eased to 54.5% while still expanding. Treasuries reversed lower with the 2-year yield down 10 bps to 4.79% and the 10-year yield down 6 bps to 5.24%.

2. Breakout day with 200 stocks up. Still little movement in up/down count. // All breadth ratios remain bearish. // 20s neutral with low count but bullish count up significantly from the very low levels of the past few days. // VIX slightly up around 16 and remains in high volatility territory. // Market Signal RISK OFF.

3. EOD: $AAOI, $CRDO, $DRAM, $MU, $MUU, $ON, $SKHY, $SNDK, $SNXX, $SOXL, $XOP. ANTS: $ALAB, $AMD, $ARM, $DELL, $META, $NBIS, $RXT, $UVIX. SWINGS: $SOXL. EP: $QMCO.

[EssKay @EssKayOne]

🔴 Market Signal: RISK OFF. // None of the breakouts are working. // $MU printed very good numbers and outlook after hours. The stock still did not react. // Plenty of continuation setups in semis and memory names, mostly sitting near resistance and getting long in the tooth. At this point I lean toward downside resolution. As long as the market stays range-bound, better wait for those names to test support before getting active again. // Breadth remains bearish and is in a stalemate. Rates ($TNX) keep grinding higher. // This market needs a catalyst in either direction to move. An air-pocket move is very possible here. // Default action: SOH.

1. Wednesday’s session ended on a weaker note after a sharp final-hour selloff erased earlier gains and put an exclamation point on a September of increasingly narrow leadership. The $SPX (-0.3%) and $DJIA (-0.9%) finished near session lows while the $NDX (+0.2%) held a slim gain, leaving the $SPX down 0.5% and the $DJIA down 4.3% for September versus a 1.9% Nasdaq monthly gain. // Information technology (+0.6%) was the day’s best sector and rose 4.4% for the month; consumer discretionary (+0.1%) was the only other gainer while consumer staples (-1.7%), health care (-1.4%), industrials (-1.3%), and financials (-1.2%) lagged. // Software led with IGV +1.2% while the PHLX Semiconductor Index finished flat after a 9.5% September gain. $HPE rose 3.9% after raising its Networking outlook, $JBL fell 10.1% despite a beat, $META and $GOOG sold off into the close, and $MRNA dropped 5.4% after a Citi downgrade. $MU reports after the close. Oil settled +1.4% at $90.54 as Hormuz crude exports returned to pre-war levels. // The Russell 2000 fell 0.3% and the Mid Cap 400 fell 0.5%, extending September losses to 5.3% and 4.3%. Decliners outpaced advancers by about 9-to-5 on the NYSE as mega-cap growth and AI strength contrasted with broad weakness. // August PCE rose a cooler-than-expected 0.3% headline and 0.2% core, but year-over-year rates of 3.4% and 3.0% remain well above the Fed’s 2% target. The 2-year yield finished unchanged at 4.89% and the 10-year yield settled up 4 bps to 5.30%.

2. Once again quite balanced day with less than 200 stocks moving and with a tilt to the bearish side. // All breadth ratios bearish though just hanging there and not really deteriorating anymore. // VIX slightly up at around 16 at a low reading but travels in volatile territory. // 20s neutral with low count on both sides. // Basically stalemate on the breadth side. // Market Signal RISK OFF.

3. EOD: $DOCS, $INTC, $OSCR, $PAYS, $SLS, $ZETA. ANTS: $ALAB, $AMD, $CRDO, $DELL, $EOLS, $MRVL, $SNDK, $STX, $TSLA, $UVIX, $VICR. SWINGS: $SOXL. EP: $QMCO.

[EssKay @EssKayOne]

🔴 Market Signal RISK OFF. // Breadth keeps deteriorating. // Semis still show quite a few nice continuation. // Today's $MU earnings in aftermarket will set the tone going forward. // Default action SOH unless some HVBO with catalyst.

1. Tuesday’s session ended with modest losses for the major averages, but the quiet finish belied another weak showing beneath the surface. The $SPX (-0.2%), $NDX (-0.1%), and $DJIA (-0.3%) recovered from midday lows with help from semiconductors and late remarks from New York Fed President Williams. // Utilities (+1.1%) led while communication services (+0.4%), industrials (+0.2%), and consumer discretionary (+0.1%) were the only other gainers; energy (-0.9%) finished at the bottom and consumer staples (-0.5%) also lagged. // Oil dropped 3.4% to $89.26 after reports that Middle East exports have recovered to their highest levels since the Iran war began. The PHLX Semiconductor Index rose 1.3%, $META rebounded 3.3%, and $CCL jumped 13.5% on a beat and record Q3 revenue. $FICO plunged 26.7% after Fannie and Freddie said they will add VantageScore alongside FICO. Williams said there is “no need for urgency,” cutting the FedWatch October hike probability to 49.3% from 70.9%. // The Russell 2000 fell 0.4% and only four sectors finished higher, leaving participation a concern alongside still-elevated yields. Attention turns to Wednesday’s PCE report. // Consumer Confidence sank to 81.9 and JOLTs openings slipped to 7.079 million. Treasuries finished mixed after the 10-year yield hit 5.29% and the 30-year yield reached 5.62%, its highest since 2002; the 2-year settled down 4 bps to 4.89% and the 10-year settled up 1 bp to 5.26%.

2. Quite balanced day with a slight tilt to the bullish side. // All breadth ratios remain bearish and keep deteriorating. // 20s are fully neutral with low readings. // VIX unchanged around 16 but in high volatility territory. // Market Signal remains RISK OFF.

3. EOD: $ANDG, $ASX, $TE. ANTS: $ALAB, $DELL, $EOLS, $KEYS, $PLTR, $SVIA, $TEAM, $U, $UVIX. SWINGS: $SOXL. EP: $QMCO.

[EssKay @EssKayOne]

🔴 Market Signal switched to RISK OFF. // $SPX and $IXIC still holding up very well. Mid caps $MDY testing 200MA and small caps $IWM about to. // Range expansions keep failing. Yet trading within support and resistance still working pretty well. // Semis still lots of nice consolidation setups forming. Yet $NVDA looks like a news failure and puts in a bearish reversal. // Most likely $MU earnings on Wednesday to resolve the tech trade. // Overall, no clear direction visible here breadth keeps getting worse and rates keep going up. // At some time very soon, some kind of intervention likely here, reaction to it will be the tell. // Default action SOH but still willing to play HVBO with catalyst but day one 80/20 profit taking.

1. The major averages finished Monday broadly lower after a volatile session shaped by sharp swings in crude oil, elevated Treasury yields, and shifting U.S.-Iran headlines. The $SPX (-0.8%), $NDX (-0.9%), and $DJIA (-0.7%) ended near late-session lows, though still above their morning worst levels. // Consumer staples (+0.4%), health care (+0.3%), and energy (+0.2%) finished higher; communication services (-1.7%), consumer discretionary (-1.6%), financials (-1.1%), and industrials (-1.0%) were the largest laggards. // Oil surged above $95 after President Trump rejected Iran’s ceasefire proposal, then reversed after reports of possible sanctions relief and an enrichment halt, settling just +0.3% at $92.44. $META dropped 4.8% after last week’s surge, the PHLX Semiconductor Index fell 1.6%, and $MDB plunged 18.5% after its CEO stepped down to join Meta. $NVDA rose 1.7% after lifting its buyback authorization to $235 billion. // The Russell 2000 and S&P Mid Cap 400 both fell 0.7%. Midday diplomatic headlines failed to hold as lingering war-and-Hormuz uncertainty and elevated yields kept pressure on cyclicals and mega-caps. // There was no economic data of note. Treasuries had a rough start with the 2-year yield up 8 bps to 4.93% and the 10-year yield up 9 bps to 4.25% after touching 5.26% in the morning.

2. BD day with 300+ stocks down. // All breadth ratios bearish. // Mid and long term breadth keeps worsening. // 20s are now balanced and in neutral territory. // T2108 is below 20. // VIX jumps 8% to 16 and moves to high volatility territory yet overall still relatively low reading. // Market Signal switched to RISK OFF.

3. EOD: $KOD, $VSXY. ANTS: $ALAB, $AMBQ, $KLAC, $SNDK, $STX, $WDC. SWINGS: $SOXL. EP: $QMCO.

[EssKay @EssKayOne]

🟠 Market Signal: CAUTIOUSLY BULLISH. // $TNX at record high and is at a key level. Expect a meaningful reaction. Rates most likely move lower near term, which would support stocks. // $MU earnings Wednesday will add color on the AI trade. Friday’s September employment report is the week’s main event. // Mega caps, semis, and crypto are working. Everything else is not. Stay in that corner of the market. // Expect choppy action to continue. Some clean continuation setups are forming in semis. // Action: Take setups in semis and HVBO names with catalysts. Default: SOH.

1. This week, the stock market finished mostly higher as semiconductor and mega-cap growth strength outweighed a midweek surge in Treasury yields and weakness across much of the broader market. The S&P 500 gained 1.2%, the Nasdaq Composite climbed 2.1%, and the DJIA advanced 0.3%. The Russell 2000 fell 0.8% and the S&P Mid Cap 400 slipped 0.1%, while the S&P 500 Equal Weighted Index declined 1.0%. Information technology rose 3.1% and the PHLX Semiconductor Index surged 6.3%. The Vanguard Mega Cap Growth ETF gained 2.7%, communication services rose 2.2%, and health care advanced 1.7%. Utilities fell 3.2%, financials 1.6%, real estate 1.4%, energy 3.0%, and consumer discretionary 0.5%. WTI crude declined nearly 4% for the week. The 10-year Treasury yield rose 16 basis points to 5.16% after stronger-than-expected PMI readings and hawkish Fed commentary.

On Friday, the stock market finished with solid gains, as the S&P 500 and Nasdaq Composite each rose 0.5% and the DJIA gained 0.9%. The Russell 2000 advanced 0.1% and the S&P Mid Cap 400 rose 0.3%. Crude oil settled $2.51 lower (-2.7%) at $92.17 amid reports of constructive U.S.-Iran talks on the Strait of Hormuz. Information technology rose 1.0% and the PHLX Semiconductor Index gained 1.4%, with $MSFT up 3.66%. Industrials advanced 0.9%, led by $BE (+8.27%), and financials rose 0.5%. $COST gained 2.93% and $AKAM rose 3.20%. Energy fell 0.9%, communication services declined 0.7% as $META dropped 3.33%, and real estate slipped 0.4%. The 2-year Treasury yield fell 6 basis points to 4.85% and the 10-year yield declined 2 basis points to 5.16%. August durable goods orders were unchanged and the final September University of Michigan Consumer Sentiment Index rose to 48.1.

Key economic news for this week: Mon – FED head speech; Tue – Case-Shiller Home Prices, Consumer Confidence, Job Openings, several FED heads speaking; Wed – ADP Employment, GDP, Trade Balance, Wholesale Inventories, Retail Inventories, Personal Income, Personal Spending, PCE, Core PCE, Chicago Business Barometer, FED head speech; Thu – Jobless Claims, Manufacturing PMI, ISM Manufacturing, Construction Spending; Fri – Employment Report, Unemployment Rate, Hourly Wages, Factory Orders, FED head speech.

Very quiet day with bullish tilt but both less than 150 stocks up and down. // Breadth remains bearish. // Medium term breadth is nearing extreme bearish levels. // T2108 with 20 is near its 52-week lows but still far away from levels to load up the truck. // 20s are in neutral state with a clear bullish tilt. // NAAIM up 16 points from last week now at 88, neutral but at the higher end. // Longer term breadth keeps going down while short term breadth and positioning is neutral. Hence overall a neutral non actionable reading. // VIX sits around 15 so no fear here. // In summary everything is possible here no direction bias visible. // Market Signal remains CAUTIOUSLY BULLISH.

3.EOD: $MCHP, $MSFT, $ON. ANTS: $AMBQ, $GLOO, $LITE, $SNDK, $STX. SWINGS: $MU, $SOXL. EP: $QMCO.

[EssKay @EssKayOne]

🟠 Breakdown day with less than 250 stocks down. // All breadth ratios bearish. // 20s back to neutral range with an elevated bullish reading. // VIX unchanged below 16. // Market Signal remains CAUTIOUSLY BULLISH.

1. The major averages recovered from a sharp morning decline to finish little changed on Thursday as crude oil retreated substantially from its session high. The $SPX and $NDX ended flat while the $DJIA (-0.3%) logged a modest loss. // Communication services (+1.9%) led while health care (+0.7%) and energy (+0.4%) also gained; materials, utilities, and consumer staples each fell 1.0% and information technology finished -0.3% after being down more than 1% earlier. // Oil surged above $96 before backing off after a Reuters report that a potential phased reopening of the Strait of Hormuz is being discussed, settling +2.4% at $94.68. $META jumped 4.5% to year-to-date highs as Muse continued to drive its September rally, semiconductors recovered most of their early losses, and $ORCL lagged after a force majeure notice on a New Mexico data center. // Decliners still outpaced advancers by nearly 2-to-1 on the NYSE, pointing to a weaker underlying session than the flat headline finishes suggested. New York Fed President Williams said another rate increase this year is reasonable. // Initial claims stayed low at 197K and new home sales beat at 684K. Treasuries failed to recover with the 2-year yield up 2 bps to 4.91% and the 10-year yield up 7 bps to 5.18%.

2. Breakdown day with less than 250 stocks down. // All breadth ratios bearish. // 20s back to neutral range with an elevated bullish reading. // VIX unchanged below 16. // Market Signal remains CAUTIOUSLY BULLISH.

3.EOD: $ADPT, $GLND, $PL, $PUBM, $RVMD, $RVTY, $SN, $TEM, $TWST, $XBI. ANTS: none. SWINGS: $MU, $NOW, ethereum:0xe0b7ad7f8f26e2b00c8b47b5df370f15f90fcf48. EP: $QMCO.

[EssKay @EssKayOne]

🟠 Market Signal remains CAUTIOUSLY BULLISH. // Indices near ATHs yet remain under distribution. // Breadth is short term overbought while longer term breadth shows oversold conditions with T2108 at 20. // $TNX (rates) at 20 year highs. // Situation remains special. Not sure what to make of it. // Bounce has played out for now. // Default action SOH.

1. The major averages finished broadly lower on Wednesday as a sharp rise in Treasury yields and another increase in crude oil weighed on the market, while semiconductors and mega-cap growth stocks gave back some of their earlier-week gains. The $SPX (-0.8%), $NDX (-1.1%), and $DJIA (-0.7%) posted sizable losses and the Russell 2000 (-1.8%) underperformed. // Energy (+0.9%) was the standout sector while communication services (-1.9%), utilities (-1.9%), and consumer discretionary (-1.6%) ranked among the weakest; information technology fell 0.7% as the PHLX Semiconductor Index dropped 1.2%. // Stronger September PMI readings (Services 58.7, Manufacturing 57.0) and comments from Fed Governor Barr that further tightening will likely be needed sent the 10-year yield up 14 bps to 5.11%. $META stayed higher on Muse AI enthusiasm, but $EXPE and $ABNB sank on disruption fears and $MCD hit a new 52-week low after unveiling its NEXT strategy. Oil rose 2.1% to $92.46 as a U.S.-Iran truce remained elusive. // Decliners outpaced advancers by more than 3-to-1 and fewer than half of $SPX components remain above their 200-day moving averages, underscoring deteriorating participation. // MBA Mortgage Applications fell 1.5%. The 2-year yield jumped 14 bps to 4.89% and the October FedWatch hike probability rose to 66.4% from 55.4%.

2. Breakdown day with nearly 400 stocks down. // Breadth remains bearish and long term breadth is actually starting to slide into very oversold levels. // 20s bullish remain in an extreme overbought condition. // Hard to grasp with indices near ATHs and short term overbought while longer term breadth oversold conditions. Situation remains special. // VIX jumps 7% to 15 which still remains very low reading. // Market Signal remains CAUTIOUSLY BULLISH.

3. EOD: none. ANTS: $DHT, $TEM, $TH. SWINGS: $MU, $NOW, solana:5XqMbyZbtse5UQUzgrYMpeWLWLR6BWFqUm5H3VAWpump. EP: $QMCO.

[EssKay @EssKayOne]

🟠 Market Signal remains CAUTIOUSLY BULLISH. // FOMO starting to kick in. // Decent breadth yesterday but still nothing to write home about. // Semis $SOXX keep ripping higher. // Third day of the move and indices at resistance now. // Maybe one more day gas left in the tank but some consolidation in the strong names should start building. // Action: Focus on HVBO only.

1. The major averages finished mixed on Tuesday as continued strength in semiconductor stocks and improving participation beneath the surface offset pronounced weakness in financials and other pockets of the large-cap market. // The S&P 500 ended unchanged following Monday's sizable advance, while the Nasdaq Composite (+0.5%) outperformed, reaching record highs. The DJIA (-0.4%) lagged, while the Russell 2000 (+0.5%) and S&P Mid Cap 400 (+0.3%) showed relative strength. // Semiconductor stocks remained the clearest source of support. The PHLX Semiconductor Index climbed 2.1%, helping the information technology sector (+0.6%) finish among the better-performing groups, with memory stocks again showing pronounced strength. Chip stocks reached fresh highs after President Trump reiterated his support for continued AI development during his UN General Assembly address. // The broader mega-cap picture was less supportive than Monday. The communication services sector (-1.0%) finished among the laggards after trading higher early, limiting the benefit of semiconductor strength for the cap-weighted S&P 500. That divergence was evident in the stronger performance of small and mid-cap stocks. // The financials sector (-1.6%) remained a significant drag. Selling extended across banks, regional banks, insurers, and asset managers. Charles Schwab (SCHW), Allstate (ALL), and Wells Fargo (WFC) were particularly pressured. // Strength elsewhere was fairly broad. The materials (+1.9%) and consumer staples (+1.2%) sectors finished atop the standings, while health care (+0.6%) also outperformed as Moderna (MRNA) extended its recent surge. // Homebuilders were another standout, with the iShares U.S. Home Construction ETF climbing 3.2%. Lennar (LEN) remained a notable outperformer after Berkshire Hathaway increased its stake. // WTI crude settled $0.56 lower (-0.6%) at $95.21 per barrel. The 2-year note yield finished unchanged at 4.75%, and the 10-year note yield settled up one basis point to 4.97%. // Tuesday featured a sharp divide: semiconductor strength and gains among small and mid-cap stocks contrasting with weakness in financials and several mega-cap areas. That left the S&P 500 little changed, while chip strength helped propel the Nasdaq to record highs. // There was no economic data of note today.

2. Decent breakout day with over 300 stocks up. Looks like FOMO kicking in. // Breadth remains bearish but improved slightly today. // 20s bullish reached extreme levels meaning market is short term overbought. // However, not so much yet as it would be a signal yet. Just be cautious here especially with new buys. // Market Signal remains CAUTIOUSLY BULLISH.

3. EOD: $GDXU, $RSKD, $SAIL, $VKTX, $XBI. ANTS: $COIN, $HOOD, $TEM. SWINGS: $MU, $NOW, $SOXL. EP: $QMCO.

[EssKay @EssKayOne]

🟠 Market Signal CAUTIOUSLY BULLISH. // Interesting Market, $SPY made a range expansion near its ATHs and also $NDX broke out of its downtrend line. // However, breadth is pretty poor. Around this time in midterms market is supposed to make its lows. Currently most stocks do so and breadth is bad. On the other hand market is near its ATH while breadth is so poor. This either means market is carried higher with very little support and if those stocks break down we might hit an air pocket. Alternatively it could mean the washout is already done and if the poor performing stocks turn around market rockets higher into end of year. Anyways, we are at the 3rd day of a bounce with pretty poor breadth. // So default action is SOH unless a HVBO with catalyst comes around.

1. The major averages opened the week with robust gains on Monday, powered by a resurgence in semiconductor and mega-cap stocks plus relief from oil and yields. The $SPX (+1.5%) and $NDX (+2.3%) finished near session highs while the $DJIA (+0.7%) also advanced. // Communication services (+3.9%) topped the sector standings and information technology (+2.5%) was close behind; energy (-2.5%) finished at the bottom as seven sectors ended higher. // The PHLX Semiconductor Index surged 4.3% with $AMD jumping 10.0% to a new all-time high above $600 and a $1 trillion market cap, while $INTC gained 12.1%. $META soared 11.3% as its Muse AI agent hit the top of the App Store, $NVDA rose after Jensen Huang pushed back against AI-safety fears, and oil dropped 4.5% to $95.77 on optimism about possible U.S.-Iran talks at the UN. // Lower crude and Treasury yields helped broaden participation beyond mega-caps, with Bitcoin above $86,000 lifting crypto-related names. Preliminary U.S.-China AI talks were described as successful and produced no agreement to slow development. // There was no economic data of note. Treasuries were mixed with the 2-year yield up 1 bp to 4.75% and the 10-year yield down 4 bps to 4.96%.

2. Very light breakout day with less than 150 stocks up. // Medium and long term breadth remains bearish. // T2108 even negative today and near the levels as seen back in April and at 52-week bearish extremes at 23. // 20s remain neutral with a clear bullish tilt. // Market Signal CAUTIOUSLY BULLISH.

3. EOD: $AAL, $AKAM, $APPS, $CRML, $FSLY, $GRPN, $NTSK, $SHOP, $SPY, $UAL, $WBD. ANTS: $CLOV, $EOSE, $TEM. SWINGS: $MU, $SOXL. EP: $CRML, $QMCO.