OVERVIEW
🟡 Moderate Risk-On

Macro: Slow, consolidation-heavy tape as markets wait for PPI (Wed) and CPI (Thu). Fed cut is locked, but hotter CPI (2.7% → 2.9%) could muddy the path. Watch today’s NFP annual revision (30 min after open) as it could reset the jobs picture.

SPY: Less than 1% off highs, but breadth and breakout follow-through remain weak as headline strength is masking fragile internals.

QQQ: Structure improving with $578 flipped from resistance into support, but $580 supply is still capping upside. Best case = more compression here.

MDY: Choppy action and $600 has flipped into support, but no conviction yet as doji/hammer combo shows indecision.

IWM: Still grinding higher with better breadth, but losing velocity and supply at $240 remains unabsorbed.

MARKET ANALYSIS
Waiting Game: Key Inflation Ahead

Yesterday was another slow, consolidation-heavy session and that’s the template heading into today. From a macro standpoint, there’s really only one thing that matters this week: inflation data.

The Fed meeting next week is already a done deal for a September cut. The open question is the pace: steady quarter-point steps vs. something larger. That path will be dictated by PPI on Wednesday and CPI on Thursday.

Here’s the tension:

• Labor data is weakening → textbook case for easing.

• But consensus sees CPI rising from 2.7% to 2.9% → hotter inflation muddies the picture.

• As Apollo’s Torsten Slok put it: when jobs soften, the Fed cuts; when inflation rises, the Fed hikes. Having both at once creates confusion, and that’s why the tape is stuck in chop.

Don’t overlook today’s NFP annual revision (30 minutes after the open). This is a one-off event, but it can meaningfully reshape how the market views the labor trend, especially if prior job gains get revised sharply lower.

Combine that with the NFIB Small Business Optimism Index (out premarket), and the labor picture could look weaker before PPI/CPI even hit.

Nasdaq

% over 20 EMA: 47.52% | % over 50 EMA: 43.56% | % over 200 EMA: 60.39%

The Nasdaq has spent the last month failing at the same ceiling, but yesterday’s tape quietly improved the structure.

The key battleground remains $580, where a dense VRVP supply cluster has capped every attempt since early August. Friday’s rejection confirmed sellers still control that shelf. Until absorbed, this is the gatekeeper level.

What changed yesterday was just below it. The $578 zone, which acted as resistance for most of August, has now flipped into support. QQQ printed an inside day that held above this band and the first clean evidence of what Wyckoff logic calls a character change.

In auction terms, the market is beginning to accept higher value: sellers who repeatedly capped this zone have been absorbed, and buyers are now defending it.

Layer in the rising 10-EMA beneath, and the structure has tightened. This is precisely what you want to see before an eventual break: resistance retested and converted into a floor, energy compressing just under supply.

For today, the highest-value outcome would be further consolidation sandwiched between $578 demand and $580 supply.

That kind of tight volatility contraction builds pressure right at the pivot and sets the stage for what we expect will be an imminent breakout attempt.

We broke this exact setup down in far greater detail for Swingly Pro members, including the intraday levels we’re tracking, how supply absorption shows up in order flow, and the breadth tells that confirm whether a breakout is real.

S&P 400 Midcap

% over 20 EMA: 69.00% | % over 50 EMA: 65.50% | % over 200 EMA: 62.25%

The tape in midcaps continues to be undeniably choppy, and there isn’t much new directional information beyond what the candles themselves are telling us.

Friday’s session printed a doji, and yesterday followed with a red hammer on elevated relative volume. That pairing doesn’t signal strength so much as indecision with a bid underneath as the market tried to push lower, and demand stepped in aggressively enough to absorb it.

From a supply/demand standpoint, that matters. The $600 zone, which capped price repeatedly through mid-to-late August, has now acted as support for two sessions in a row. That’s the same “character change” dynamic we highlighted in QQQ: prior resistance being defended as support.

Still, context is key. A hammer off support only carries weight if there’s follow-through, and so far, MDY has shown little directional conviction.

The message here isn’t that midcaps are leading as they’re not. The message is simply that buyers are defending the $600 zone, keeping this index in balance rather than letting it roll over.

Russell 2000

% over 20 EMA: 69.85% | % over 50 EMA: 69.60% | % over 200 EMA: 61.36%

Although small caps have worn the crown in recent weeks, the QQQ is now starting to show a cleaner and more constructive technical structure than the Russell.

The daily pattern mirrors what we just outlined in midcaps: Friday’s doji followed by yesterday’s red hammer. On the surface, that looks constructive as buyers defended weakness, demand stepped in, and support held. But the broader context matters.

The IWM’s advance has been a slow grind higher, with little of the explosive momentum that powered its July–August squeeze.

Much of that rally was driven by forced covering across crowded shorts in small caps, but in the last two weeks, that energy has started to fade.

Breadth remains better than QQQ and MDY, but the lack of velocity is a tell. A healthy small-cap tape tends to lead with sharp impulse legs, and what we’re seeing now is far more labored.

For dip buyers, the regime is still rewarding entries near the rising 10- and 20-day EMAs. For breakout traders, the message is different: supply near $240 remains unabsorbed, and without fresh sponsorship, upside resolution is unlikely.

FOCUSED STOCK
CCJ: A Bull Flag in A Uranium Leader

ADR%: 3.87% | Off 52-week high: -7.0% | Above 52-week low: +120.7%

Cameco (CCJ) is setting up the exact type of breakout structure we look for in leadership groups. Since peaking in July, the stock has been building a classic flag, with each dip met by progressively higher lows.

The most important piece is the volume profile. Relative activity has been linearly contracting since July, a textbook sign of volatility compression.

The one exception was the August pullback into the 50-day EMA, where demand stepped in aggressively on elevated relative volume.

That reversal confirmed institutions are still defending their positions, and since then, CCJ has been consolidating right along its Point of Control (POC) showing evidence of value acceptance, not distribution.

This is what a volatility contraction pattern (VCP) looks like in real time: declining volume, tighter price swings, and higher lows against a well-defined supply line. When that structure resolves, it typically does so with force.

The sector context adds conviction. The uranium ETF (URA) is itself carving a parallel flag, holding just below resistance with the same contractionary volume signature.

This is the exact alignment you want to see: leading stocks inside strong sectors consolidating in sync. That combination is where outsized moves often emerge once supply is absorbed.

📌 Takeaway: A decisive break through the $78–80 supply band would complete the flag and open the door for continuation. As long as the stock continues to defend its 50-day EMA and POC shelf, the setup remains intact.

FOCUSED GROUP
QTUM: Quantum Breaking Out of the Shadows

We’ve been hammering on QTUM for weeks, and for good reason: this is one of the most under-discussed but technically aligned themes in the market.

In Swingly Pro in the last week, we came together and all broke down the top QTUM components, from small caps grinding out multi-month bases to larger liquid names quietly coiling, and the confluence across the group is striking.

When an entire subsector builds higher-timeframe bases in sync, it’s usually a sign that institutional capital is accumulating beneath the surface.

The index itself (QTUM ETF) is confirming the story. After August’s false breakout where price poked through resistance but failed on lack of relative volume but demand stepped in exactly where it needed to: at the 50-day EMA and anchored volume shelf. That defense prevented distribution and reset the structure.

Fast forward to this week, and we now have two hammer candles in a row, a clear tell that dip demand is alive. Premarket action shows QTUM pushing through its prior highs and taking out all-time highs.

Importantly, the volume profile is clean: supply is thin above, and the heaviest positioning sits lower, suggesting that any breakout here is repricing, not just noise.

Q&A
Got a trading question? Hit reply and ask!

Q: “This might be stupid, but I’m a little confused when you talk about relative volume. I don’t get it…why is it so important?”

A: It’s not silly at all!

Think about the market as one giant auction. Every tick is buyers and sellers negotiating value. Price is just the outcome but volume is the evidence of participation.

Relative volume (RVOL) tells you whether today’s auction is ordinary or abnormal. That difference is everything.

Let’s say a stock has been capped at $50 for a month. That ceiling exists because every time buyers pushed into $50, resting sell orders absorbed demand and turned it back. That’s auction equilibrium as supply and demand are balanced there.

Now imagine the stock pushes through $50 on average volume. What does that mean?

The ceiling wasn’t really tested as supply might just be waiting higher up. It’s not really conviction just yet.

Now imagine the stock pushes through $50 on 3x RVOL (3x times what it normally trades at in a given time period e.g. 3x daily volume in a 20 day period, etc). Entirely different story. That means:

1. The usual sellers at $50 were overwhelmed and their resting supply got lifted.

2. New buyers entered with urgency and they were willing to cross the spread and pay up.

3. Institutions are active as size doesn’t (usually) move without them.

That’s why RVOL is the tell. It marks the shift from a market testing levels to a market repricing.

Order Flow Mechanics

• At resistance: You have a queue of resting sell orders.

• Low-volume breakout: Fewer buyers, slower fills, algos can fade it. Often rolls over.

• High-volume breakout: Resting sell orders get chewed through fast. Once that wall is gone, there’s no liquidity until the next cluster — price jumps through the LVN (low-volume node).

This is why high-RVOL breakouts often accelerate: the book is thin above resistance, and the only way to fill urgent buyers is to move the auction higher until new sellers emerge.

Volume Accumulation vs Price Accumulation

• Price accumulation: a base where volatility contracts and higher lows form. It shows buyers are present, but not yet urgent.

• Volume accumulation: consistent above-average buying into that base, showing institutions are quietly building.

• When both converge: the breakout happens with velocity. That’s when levels actually reset and the auction moves to a higher balance area.

Further Study:

We strongly recommend digging into Wyckoff logic and auction theory to sharpen this framework as it’s the foundation of understanding how supply and demand transitions actually work.

Also check out Jeff Sun on Twitter, who posts some of the most rigorous studies on volume/flow dynamics we’ve seen!