OVERVIEW
Compression Before Expansion

🟢 Risk-On: Nasdaq prints one of the narrowest ranges of the year. Inside days across QQQ, IWM, and MDY point to digestion, not distribution.

📊 Broad Market Structure: No breakdowns. Rotation is healthy. Leadership sectors bounced off MAs while indices stayed flat.

⚠️ Tariff Noise Absorbed: Trump confirms August 1 duties, but price action says markets are unfazed. Futures green. No fear.

🧠 Stay Ready, Not Reactive: Compression candles like this don’t last. This is where the next move builds. Your edge comes from preparation — not prediction.

MARKET ANALYSIS
Tariff Noise, Tight Tape

Tuesday's session was another low-volatility digestion day as markets absorbed the latest round of tariff headlines from the White House.

President Trump confirmed no delays or adjustments to the recently announced duties, with new tariffs ranging from 25% to 40% across 14 countries — including Japan and South Korea — set to take effect August 1. There were also fresh threats of copper tariffs at 50% and pharmaceutical tariffs potentially up to 200%, though with a longer implementation window.

Despite the political noise, markets were resilient. The S&P 500 and Nasdaq held firm, trading essentially flat, while futures are green this morning across the board.

📉 What does it mean?

We’re seeing headline risk, not systemic risk. Tariffs may cause episodic sector rotations, especially in materials or healthcare, but so far they’ve not dented the core trend. Breadth is still strong. Participation is healthy. Leadership is rotating but intact.

This kind of macro backdrop — short-term uncertainty, but technical strength — tends to favor stock picking and tactical exposure. Stay focused on setup quality and execution.

Nasdaq

The QQQ printed an inside–inside day yesterday, forming one of the narrowest price ranges in weeks — a clear signal of volume and volatility contraction. This pattern is typically a sign of compression before expansion.

But what makes this especially impressive isn’t just the tight candle — it’s what happened underneath the hood.

📊 Key Observations:

• Major sectors inside the QQQ — like semiconductors, financials, and big tech — bounced cleanly off rising moving averages yesterday.

• The fact that leaders pushed higher while the index stayed flat is a classic sign of leadership front-running the index.

• We’re seeing a healthy rotation and higher lows on key names even as the index chops sideways — a very bullish tell.

S&P 400 Midcap

The S&P 400 Midcap index (MDY) printed an inside day, tapping directly into the $580 supply zone we've been monitoring. This is a well-defined area of prior resistance with volume memory — and yesterday’s action suggests buyers are pausing, not bailing.

A few more tight sessions would allow the structure to tighten, giving buyers more leverage for a clean breakout.

Breadth remains strong within midcaps — we're not seeing breakdowns underneath the surface.

🧠 How to Interpret It:
We don’t want to push prematurely through dense overhead levels without a base.
Strong markets digest gains at key zones. That’s what creates sustainable breakouts — not just reactionary ones.

Russell 2000

Yesterday’s inside day on IWM was exactly what we needed. After a relentless 6-day vertical run, small caps finally paused right at $224, a major supply shelf we’ve been flagging for weeks. This level carries heavy volume memory from both March and April, and history tells us that price rarely breaks through such zones without friction or digestion.

But here’s the key: An inside day isn’t weakness. It’s compression—and compression near resistance is often the fuel for the next expansion.

🔍 What We Want Now:

• A couple more sessions of sideways chop or shallow fades

• Strong names consolidating above prior bases (i.e., confirming their leadership)

• Some rotation and weak-hand shakeouts to reset positioning and reload

FOCUSED STOCK
MNTN: Brewing A Major Breakout?

MNTN has come back to life after building a clean double bottom throughout June, tightening just beneath its point of control (POC) and now pushing above that key zone with a surge in early volume.

Unlike some thinly traded names, MNTN has solid liquidity and a high average daily range (ADR) — making it a favorite among momentum traders when it gets moving. It’s also one of those newer, more speculative stocks that can really hard when price discovery begins to kick in.

📊 Why This Setup Matters:

• Strong technical base: A double bottom with higher lows compressing against POC.

• Volume had been contracting into the setup — now expanding on the breakout.

• MNTN has a track record of moving fast and far when breakouts hold, especially as part of a speculative appetite rotation.

🧠 How We’re Trading It:
This isn’t a chase — we want to see follow-through volume and strength hold above the POC. From there, we’ll use the 5-minute opening range and relative volume as our tactical guides for entry or add-on.

If this is the beginning of another expansion move, MNTN has the structure, volatility, and sentiment tailwind to run cleanly.

FOCUSED SECTOR
XLE: A Rotation To Watch Closely

Yesterday, we saw an interesting development: XLE (Energy sector ETF) pushed firmly above its point of control (POC) at $88 on elevated relative volume, printing its best single-day advance in nearly a month.

What stands out?
This move wasn’t driven by a sharp spike in crude oil or nat gas futures — both traded relatively flat. Instead, this looks more like rotation-based capital flow rather than commodity-driven speculation.

Other confirmations:
We’ve also seen strength bleeding into related infrastructure names via XOP (oil & gas exploration) and GNR (natural resources ETF) — all forming solid bases and triggering clean breakouts over the last few sessions.

Why does this matter?
In risk-on bull environments, it's common to see growth leadership (Tech, Semis, Crypto) move first. But once those sectors start to extend or pause for digestion, institutional money often rotates into other “under-owned” sectors — like Energy, Industrials, or Materials — as a way to keep exposure while reducing near-term volatility risk.

This dynamic is a sign of broadening participation, and it supports the thesis that we’re in a structurally strong uptrend, not just a narrow rally led by a few mega-cap names.

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

Q: “When you buy into a stock, do you pyramid into a position or buy it all at once?”

This is a great question, and one that speaks directly to the type of trader you're trying to become.

We don’t pyramid. We enter aggressively and decisively, typically all at once, or in a tightly controlled bracket because our entire approach is built around precision execution, repeatability, and tight statistical control over our entries and outcomes.

1. Pyramiding Increases Complexity

Adding to a position multiple times shifts your cost basis, dilutes the clarity of your entry, and often muddies your stop-loss logic. That makes it harder to track what’s working and what isn’t, especially when you’re trying to refine or test a system over hundreds of trades.

As traders, we’re not paid to make our trading look sophisticated.

We’re paid to keep it simple, scalable, and systematic.

2. We Trade Like Scientists

We don’t just wing our entries as we run our systems like a hedge fund would:

• Logging every trade

• Running post-trade analysis on win rate, R-multiples, expectancy

• Testing variations (entry timing, sizing logic, hold durations, etc.)

• Optimizing setups across 100+ trades, not 1

That only works when your process is tight and replicable.

If your position is pieced together with random adds, your data gets noisy fast. You lose clarity.

3. We Focus on the Setup, Not the Sizing Game

We’d rather enter with size into a high-probability, A+ setup, than play the game of slowly scaling in, hoping the move continues.

If the setup is valid, the entry should be clean.

If the move has real power, it should go.

And if not? Take the small hit, move on. Simple.

If you’re serious about mastering your system, leveling up your execution, and trading alongside a team of focused, high-performance traders, we can help.

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