MARKET ANALYSIS
Here’s All You Need To Know

• The market is in wait-and-see mode this morning, but today is not a quiet session underneath the surface. We have the Fed decision, Powell’s likely final press conference, and earnings from Microsoft, Amazon, Alphabet, and Meta all arriving after the close.

• The biggest issue for equities today is no longer simply whether the AI trade is working. It is whether the hyperscalers can justify the scale of spending that has been driving the entire AI infrastructure complex.

• Yesterday’s pressure in semiconductors came after reports that OpenAI had missed internal revenue and user-growth targets. Whether that report proves fully accurate or not, the reaction told us something important: the market is now sensitive to any sign that AI infrastructure spending may be running ahead of monetization.

• That matters because Microsoft, Amazon, Alphabet, and Meta collectively represent a massive share of the S&P 500 and are central to the AI capex cycle. If their commentary confirms continued aggressive spending, the AI trade can stabilize. If they sound more cautious, the pressure in semiconductors and AI infrastructure names can continue.

• The Fed is also important today, but the market is not expecting a rate move. The more important variable is Powell’s tone around inflation, oil, and labour-market resilience, especially with WTI back above $100 and Brent above $110.

• Oil remains the macro risk that the market cannot fully ignore. Even though equities have continued to show strength, crude is still elevated, Middle East tensions remain unresolved, and energy-driven inflation risk is still sitting in the background.

• The UAE leaving OPEC is also not a small development. It raises questions about the cartel’s ability to manage supply at a time when the Strait of Hormuz remains a major geopolitical pressure point.

• The market has been incredibly resilient, but today is a major confirmation test. The bulls need strong hyperscaler earnings, confident AI spending commentary, and no major upside surprise in Powell’s inflation language.

• For now, we still see strength in the broader market, but the easy part of the AI rally has passed. From here, the market needs proof that the spending cycle is translating into real revenue growth, not just bigger capex promises.

S&P 500

55.86%: over 20 EMA | 52.08%: over 50 EMA | 55.26%: over 200 EMA

• SPY remains in a higher-low structure, but the failure to push into fresh highs is starting to matter. Yesterday’s red doji came on just 54% relative volume, which confirms indecision rather than aggressive distribution, but the broader setup still leaves the market vulnerable to a cooling-off pullback.

  

  WTI VRVP Daily & Weekly Chart

  

  XOP VRVP Daily & Weekly Chart

  

  XES VRVP Daily & Weekly Chart

• The main pressure point today is oil. WTI, XLE, RSPG, XES, and XOP are all expanding higher in pre-market, and that matters because renewed strength in energy usually creates pressure on growth-heavy areas of the market.

• This is exactly why we warned about the XSD parabolic short setup two days ago. Semiconductors reached a 13x ATR extension from the 50-day EMA, and yesterday that short thesis hit the rising 10-day EMA target after a roughly 10% pullback from the callout.

Nasdaq

59.40%: over 20 EMA | 54.45%: over 50 EMA | 52.47%: over 200 EMA

• QQQ is still showing slightly better relative strength than SPY, but it is also more extended. The Nasdaq has a 66 relative strength rating versus the SPY’s 60, but it is sitting at 5.2x ATR from the 50-day EMA, which makes a pullback to the rising 10-day EMA the higher-probability move.

• The correct playbook now is changing. This is no longer the ideal environment for chasing opening range high breakouts; the higher-efficacy setup is now pullback longs into the rising moving average complex (e.g. see META below).

  

  META VRVP Daily & Weekly Chart

S&P 400 Midcap

67.91%: over 20 EMA | 63.65%: over 50 EMA | 60.15%: over 200 EMA

• MDY is still holding an important demand zone. The mid-caps broke below the 10-day EMA yesterday but bounced directly from the $655 area, where the VRVP shows roughly a 2-to-1 buyer imbalance with 203k shares traded green versus 102k red.

• For MDY, the key is whether price can reclaim the midpoint of the range near $664. If it fails, a deeper pullback toward the rising 20-day EMA near $650 remains viable, and that level also shows strong buyer aggression on the volume profile.

Russell 2000

71.39%: over 20 EMA | 71.07%: over 50 EMA | 61.54%: over 200 EMA

• IWM remains one of the strongest risk-on proxies, but it is also beginning to cool. Roughly 71% of Russell stocks remain above their 20-day and 50-day moving averages, which shows strength, but short-term breadth is still hot enough to justify patience.

• The Russell 2000 is forming a strong high-tight flag, but a pullback to the 20-day EMA would be healthy. Price has now contracted for 11 days while holding the 10-day EMA, but the VRVP shows a visible gap down toward the 20-day EMA, making a -2.21% pullback a realistic and tradable scenario.

• The broader message is simple: this is not a broken market, but it is no longer an easy chase market. Breadth is still strong, buyers are still defending key levels, but oil strength and semiconductor mean reversion mean traders should shift toward pullback entries rather than late breakout exposure.

FOCUSED GROUP
BOAT: Shipping & Oil Pushing Together

• The group we are most focused on right now is BOAT, because global shipping is starting to re-enter focus exactly as crude continues pushing higher. Shipping tends to respond quickly when oil strength persists, and this is now becoming one of the more technically interesting areas outside traditional energy.

• Earlier this year, between early January and early March, BOAT delivered one of the strongest thematic moves we have seen in recent quarters, rallying roughly 36% in 55 trading days. At the peak of that move, it reached roughly 13 ATR multiples above the 50-day moving average, which again reinforces why ATR extension matters so much when identifying parabolic conditions.

• After that initial vertical phase, BOAT has spent roughly 63 trading days building a very clean intermediary Stage 2 base, holding its rising 10-week moving average while price volatility has tightened materially.

• The structure now is exactly what you want to see in a healthy continuation candidate: higher lows, lower highs, declining volume, and clear volatility contraction. In other words, a textbook VCP structure.

• Volume expanded progressively during the initial January-to-March advance, then faded during consolidation — which is constructive. It suggests supply has gradually been absorbed rather than aggressively distributed.

• Relative strength remains extremely high, with a 90 RS rating versus the SPX, which is why this remains a group worth tracking closely while oil continues pressing higher.

• What makes BOAT especially relevant now is that it sits at the intersection of two active themes: industrial transport and energy sensitivity. Sector composition reflects that clearly — roughly 70.7% industrials and 29.3% energy exposure.

• Do not just look at the ETF itself. Focus on the underlying holdings, identify which names are leading the group, and then narrow them based on your own execution style — especially ADR, liquidity, and trend cleanliness.

• If oil remains bid and the broader market enters a pullback phase without breaking structurally, BOAT is one of the cleaner groups that can continue separating from the rest of the tape.