OVERVIEW
Wall Street Rallies on Tech Strength and Easing Trade Tensions 📈

U.S. stocks surged on Thursday, marking a third straight day of gains as technology shares led a broad market rally. The Dow climbed 1.23%, the S&P 500 gained 2.03%, and the Nasdaq soared 2.74%, powered by strong earnings and signs of de-escalation in U.S.-China trade tensions.

Tech stocks were the standout performers, with ServiceNow jumping 15.5% after posting better-than-expected results, thanks to strong demand for its AI-powered software. Hasbro also beat expectations, with shares up 14.6% following robust performance in its gaming segment. Alphabet (Google’s parent company) rose in after-hours trading after topping revenue estimates for Q1.

Markets found further support as China urged the U.S. to roll back tariffs, and Treasury Secretary Scott Bessent hinted at possible easing of trade policies — a welcome shift for investors rattled by recent uncertainty. The semiconductor sector, heavily exposed to global trade, especially benefited from the more hopeful tone.

Still, caution remains. Companies like Procter & Gamble, PepsiCo, Chipotle, and American Airlines all cut or withdrew their forecasts, citing ongoing uncertainty and weakened consumer sentiment. P&G and Pepsi shares fell 3.7% and 4.9%, respectively.

Economic data added to the positive tone: March durable goods orders exceeded expectations, and jobless claims remained steady, painting a picture of resilience in the U.S. economy.

So far, 74% of S&P 500 companies reporting earnings have beaten expectations, with projected aggregate earnings growth now at 8.9% year-over-year — up from 8% at the start of the month. Investors will continue to monitor both earnings and trade developments as the quarter unfolds.

MARKET
Ignore The News: What Does The Tape Tell You?

The market simply needed a catalyst—a spark to ignite movement from the deeply depressed levels we've been seeing. And that’s precisely what we're witnessing right now. While we’re still navigating through a period of volatility and choppy price action, the broader picture is starting to take shape. As we approach next week, the focus will shift heavily to earnings from big tech, which could serve as the defining moment for where the major averages go from here.

What stands out in this environment is the resilience of the market in the face of ongoing political uncertainty. A report on Friday suggested that China may pause its 125% tariff on some U.S. goods, which has injected some optimism into the market. While Trump has claimed progress in negotiations, China has denied the existence of any such talks and demanded the U.S. lift tariffs. Despite this, the market has yet to show a significant negative reaction, and this lack of volatility amidst political tensions is a constructive sign. The fact that the market hasn't broken down further, even with these tensions, suggests it is finding its footing and could be poised for a more positive move forward.

As we assess the broader context, it's clear that the market has broken through key levels. Now, the question is whether the leaders—those stocks that have consistently outperformed—will hold up and continue to guide the market forward.

Nasdaq

The Nasdaq has clearly broken a significant downtrend that started after the late February sell-off. As seen on the visible range volume profile (VRVP) chart, the 20-EMA acted as a key level of support, with buyers stepping in to defend it. This shift in market character is bullish in the short term.

The key focus now is how the Nasdaq will behave as it approaches the overhead point of control (POC), a major resistance zone with substantial supply. The POC is the price level with the highest trading volume in the visible range, and how the market reacts here will determine the strength of the current uptrend.

A concern, however, is the lack of a strong surge in relative volume as the Nasdaq tests this resistance. Volume is crucial for confirming price movements, and without significant volume during this advance, the move may lack the conviction needed to push through the POC. If volume doesn't increase, the price action could be fragile, potentially leading to a pullback or stall at this resistance, as there may not be enough buying pressure to overcome the overhead supply.

S&P Midcap 400

The midcaps also moved higher, testing their key 20-EMA level. However, similar to the Nasdaq, the volume was notably low, marking the lowest relative volume we've seen all month. This places us in a precarious position—just like with the QQQ, unless we see a strong influx of buying pressure and a subsequent surge in relative volume, we remain highly susceptible to sharp pullbacks.

In all honesty, the midcaps are not in the best position to scan for leadership right now, as they aren’t typically where we see leaders emerge post-correction. Until we see clearer signs of strength, it's better to focus on the areas of the market with more robust leadership potential- large cap technology stocks.

Russell 2000

The small caps, of course, align with the same analysis, so we won’t bore you with repetition. However, we do want to highlight something interesting: the recent strength is broad-based, meaning it’s not limited to just one group or capitalization segment. This is actually good news. The reason is that it could be an indication that, even if this is just a technical bounce or nothing more than a low-volume bear market rally, there are still opportunities across the groups.

What will be very important to watch, and this applies to the mid and small caps as well, is the upcoming big tech earnings season starting next week. The performance of major tech companies will likely set the tone for the broader market and could provide critical signals for where the market heads in the short term—especially when considering the forecasts analysts predict for the future.

These projections will be influenced by a range of factors, including the potential implications of the ongoing tariff situation. How these companies navigate these challenges and what they forecast for the coming quarters will be key in shaping market sentiment and determining whether the current rally can be sustained.

DAILY FOCUS
You Can Never Outsmart Price & Volume

It's easy to get caught up in the noise of the market. Traders often fall into the trap of overcomplicating their analysis—trying to predict political events, dissect macroeconomic theories, or play expert economist. While these factors can sometimes influence the market, they should not be the focus of your trading decisions unless they directly align with your edge.

The reality is simple: price and volume tell you everything you need to know. The market is a reflection of collective sentiment, and that sentiment is expressed in price movement and the volume behind it. You don’t need to be a political analyst or an economist to succeed. What you need is to understand how the market is behaving right now and respond to it accordingly.

Price is a direct reflection of supply and demand. Volume is the fuel that drives that movement. If price is rising and volume is confirming it, the market is telling you it's a strong move. If price is rising but volume is shrinking, it's a red flag, signaling weakness. These are the types of simple yet powerful signals that matter, and they don't require you to predict the future or speculate on external factors.

Today, we're seeing a strong short-term uptrend in a market that’s still trending down over the long term. For those familiar with market theory, this could be considered a potential bear market rally. That doesn't mean it is a rally, but it's a cautionary signal. As traders, it's crucial to acknowledge the risks, but we play the odds—focusing on what the price and volume are telling us.

Despite the broader market context, we are seeing genuine strength in the leaders—stocks that have consistently outperformed and held up better than the rest. These are the names we're targeting, and we’ve positioned ourselves with substantial long exposure to them.

WATCHLIST
Focus On These On A Strong Reaction

RKLB: Rocket Lab USA, Inc

• RKLB has quietly been showing significant strength recently. Not only did it manage to reclaim its previously lost 200-EMA on the daily chart, but it has now reclaimed all of its key moving averages. The stock is approaching a critical inflection point, getting dangerously close to breaking out of a multi-month range. The key breakout level we’re watching is around $223.15.

• Aerospace & Defense, the sector RKLB belongs to, has been a strong performer as well, adding confidence that a breakout could see follow-through. The combination of sector strength and RKLB’s technical setup is making this a compelling potential opportunity.

MSTR: MicroStrategy Incorporated

• It shouldn’t come as a surprise to anyone that exposure to Bitcoin is a good idea right now, especially following its major breakout this week. One of the key names we always have our eye on during strong BTCUSD performance is MSTR, which is arguably the leading name in the Bitcoin exposure space.

• MSTR has formed a triple bottom over the last few months, aligning with the weekly 50-EMA, a level that has been stubbornly defended by buyers. Now, we’re seeing a brief consolidation just below the $350 level, with MSTR pushing through it in pre-market trading.

• This setup is a great example of how to gain high-probability long exposure: First, assess the broader group (in this case, Bitcoin exposure) to ensure there's strong net inflow and momentum within that sector. Once confirmed, you can target the top names in the group to take long positions, with MSTR being a prime candidate in this environment.