OVERVIEW
Still Rangebound… But Not for Long

🟨 Risk-Neutral: After a week of headline-driven volatility — tariffs, tech pullbacks, and China tension — the major indices are still holding their ground. QQQ continues to coil near its POC, IWM is battling its descending trendline and 200-day EMA, and MDY is consolidating neatly above its 50-day. No breakout, no breakdown — just digestion.

📊 What’s Happening?: We’re seeing pockets of strength, signs of accumulation at key EMAs, and healthy rotation into staples and defensives. At the same time, we’re also seeing rejection at key supply zones, choppy reversals, and no sustained leadership expansion. Translation: the market is trying to decide — not trend.

🔑 Key Takeaway: This is textbook indecision following a big explosive multi week rally. It’s not weakness, but it’s not strength either. Don’t get chopped trying to force trades. Instead, tighten your focus, prioritize strength near support, and let the breakout — or breakdown — come to you. Momentum always reveals itself in time. Patience wins this phase.

MARKET ANALYSIS
Noise, Not Panic

Last week brought a wave of headlines — trade tensions with China and the EU, tariff drama, and general political noise. But despite all of that, the S&P 500 finished May up more than 6% — its strongest monthly gain since November 2023.

So what’s the takeaway? All the noise masked a simple truth: the market digested the pullback in a controlled, constructive way. No panic. Just rotation and rest.

🌏 U.S.–China Friction Returns:
China pushed back against U.S. claims of violating the temporary trade pact, blaming Washington for failing to honor its part. This comes just after Treasury Secretary Bessent and Chinese Vice Premier He Lifeng agreed to a 90-day tariff suspension — a move that initially calmed markets.

🤝 Talk of Talks:
National Economic Council director Kevin Hassett hinted that Presidents Trump and Xi could speak as early as this week. But with tensions rising again, it’s a reminder that diplomacy is fragile — and headlines will swing sentiment.

🇪🇺 Europe in Focus Too:
Trump’s proposal to double steel tariffs to 50% rattled U.S.–EU relations. The EU called it destabilizing and warned it adds “further uncertainty” to the global economy.

💡 Bottom Line:
We’re still in a broad trading range — not breaking down, but not breaking out either. Markets may have priced in the best-case scenario. The upside path from here likely depends on actual resolution, not just talk.

Nasdaq

📊 Holding Strong: QQQ is pausing after last week’s pressure, consolidating above its rising 10-day EMA — which it bounced off Friday on strong relative volume. That’s a bullish sign, especially given how noisy the macro environment has been.

📍 Price Anchored at POC: This entire digestion phase is happening right at the Point of Control (POC), a key area of supply and demand. Every push lower has been defended — a sign that buyers remain in control despite some profit-taking.

☕ Cup & Handle Watch: The structure forming here remains a textbook shallow cup and handle — and the shallow nature of the handle is actually a bullish tell. A breakout above $524 (above the POC) could ignite a fresh leg higher — and possibly all-time highs.

🔍 What We’re Watching: The rising 20-day EMA is now more important than the 10-day. Why? Because there’s little demand beneath it according to the Visible Range Volume Profile (VRVP). A clean hold above both EMAs = bullish continuation setup. A break below = wait for clearer structure.

S&P 400 Midcap

🟧 Taking a Breather: After a strong April rally, MDY has spent the last two weeks digesting gains. The breakout attempt above $566 (POC and resistance zone) failed — but importantly, we’ve since held the $540–$549 support cluster.

📉 Key Support Zone: This area coincides with the rising 50-day EMA, where we saw strong buyers step in last week on high relative volume — a key sign of underlying demand.

📐 Structure Update: No need to overanalyze. This looks like a classic bull flag forming after a strong leg higher. As long as price holds above the 50-day EMA, this is normal digestion — not a breakdown.

🚨 What to Watch: A loss of the $540 zone would flip the tone — but for now, this remains a textbook consolidation within a broader uptrend. Stay patient.

Russell 2000

🔻 What’s Happening: IWM continues to contract just beneath its long-term descending trendline — resistance that’s held firm since December 2024. This type of coiling below major supply is exactly what you want to see before a potential breakout.

📊 Key Levels Converging: The $209 zone is a major inflection point. It marks the intersection of:

• The descending trendline (overhanging supply),

• The 200-day EMA (psychological level),

• And the Point of Control (POC) from the multi-month range.

This cluster makes it a high-stakes level — but also one with explosive potential if cleared.

🔍 Pattern in Progress: After bouncing off the rising 20-EMA on Friday and forming a doji candle (indecision), IWM appears to be building the right shoulder of an inverse head-and-shoulders reversal pattern. It’s still early, but confirmation through $209 would be decisive.

🚀 Why It Matters: A sustained breakout over $209 would mark the first close above long-term resistance in over six months — triggering a fresh bull market period and a new rally phase for small caps.

FOCUSED STOCK
BROS: Dutch Bros Inc.

📈 Top-Down Setup: BROS sits inside the food & beverage group tracked by the PBJ ETF — one of the strongest consumer segments recently. This is a textbook top-down evaluation: strong sector → strong group → potential leader setting up.

📊 Supply Zone in Play: BROS is now testing the upper end of its multi-month supply zone around $73–$74. Friday’s high relative volume bounce off the rising 10-EMA adds fuel to the case for an upside breakout.

🔍 What We’re Watching: If BROS can push through that resistance range with conviction (price breaks an opening range high, with a surge in relative volume), it may signal the start of a fresh momentum leg. Until then — no guesses, just preparation.

FOCUSED SECTOR
XLP: Consumer Staples

🔄 Range-Bound Since September: XLP has been stuck in a wide sideways base going back to September 2024 — with multiple failed attempts to break all-time highs. Classic defensive sector behavior.

📊 Technical Setup: Last week, XLP bounced right off the rising 10-week EMA and rejected near its long-term Point of Control. That rejection now sets up a likely retest of the $83 breakout level — the top of this range.

💡 Why It Matters: If growth segments like tech and semis take a breather, XLP is well-positioned to benefit from rotation. This is what sector rotation looks like: money flows out of high-beta and into lower-volatility names as traders seek safety.

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

Q: “How do you know where to focus your attention/ which groups to prioritise for long exposure”

A: This might be the most underappreciated skill in all of momentum trading.

Momentum — in its purest form — just means: what’s moving? Where is the strength right now?

And that strength constantly rotates.

If you’re still glued to tech when money has already shifted to energy, or you’re trying to force biotech trades when semiconductors are breaking out — you’re going to miss the boat. Worse, you’ll find yourself getting chopped up while others are riding smooth trends.

Great momentum traders don’t just pick stocks — they identify the right groups first. The market moves in waves, and sectors rotate leadership. One week it’s cybersecurity and defense. The next it’s small caps and China. Then it’s back to large-cap tech.

That’s why our job is to follow the money. Capital flow creates price movement — and price + volume creates opportunity. If you can stay in sync with those waves, everything else gets easier: trade selection, execution, conviction, exits.

This is exactly what we do inside Swingly Pro.
We highlight:

• Which assets are leading (and why)

• Which groups are gaining strength or fading

• The exact names building the highest-probability setups within those groups

That way, you’re never trading blind. You’re moving with the market — not against it.

→ Want to follow the strength in real time? See what’s inside Swingly Pro.