MARKET ANALYSIS
Here’s All You Need To Know

• The market is still showing clear strength this morning, with S&P 500 and Nasdaq futures holding firm after another record close on Friday.

• The most important point remains the same as last week: growth is still where the leadership is coming from, but the technical extension inside growth is now becoming harder to ignore.

• We are still seeing major strength across the broader growth complex, with the Nasdaq continuing to outperform and Bitcoin also pushing higher this morning, which is generally a constructive risk-on signal.

• That being said, the rally is no longer as clean as it was earlier in April, because some of the Magnificent Seven names are starting to show short-term exhaustion.

• META breaking down after earnings is one example of this, while NVDA is also beginning to show some weakness after an extremely aggressive rally from the March lows.

• This does not mean the growth trade is broken. It means the strongest part of the market has become technically extended, and that makes chasing marginal highs a lower-quality setup.

• We discussed this heavily last week with semiconductors, where XSD became extremely stretched from its 50-day EMA. That type of extension does not usually mean the trend has ended, but it does mean the probability of pullbacks, shakeouts and failed breakouts increases.

• The key distinction right now is that the weakness we are seeing in some mega-cap growth names looks more like short-term exhaustion than broad distribution.

• Buyers are still active under the surface, and the broader market has not shown the type of internal breakdown that would suggest a full risk-off reversal.

• Geopolitics remain the main macro variable, with the market still watching the Strait of Hormuz and Trump’s new “Project Freedom” plan to help neutral cargo ships leave the region.

• Oil is still holding elevated levels, with WTI above $100 and Brent near $108, so the inflation pressure from energy has not disappeared.

• This matters because if oil continues to push, it can keep pressure on long-duration growth stocks, especially after the rally they have already had.

• At the same time, the market is not reacting to oil the same way it was earlier in the Iran conflict. Equities are absorbing the headlines better, which tells us risk appetite is still present.

• The more important test this week will be whether growth can consolidate without fully breaking down, especially with key semiconductor earnings from AMD, ARM and Lattice Semiconductor still ahead.

• The April jobs report on Friday will also matter, with economists expecting slower job growth. A softer labour print could support the market if it reduces rate pressure, but a sharp deterioration would raise a different set of growth concerns.

• For now, the market remains strong, but this is not the clean early-stage breakout environment we had a few weeks ago.

• The correct framework is still to respect the strength, but stop chasing the most extended breakouts.

• We want to keep focusing on the strongest growth groups, but only where the entry quality is there — ideally on pullbacks into rising moving averages, not late entries after several weeks of straight-line expansion.

S&P 500

55.66%: over 20 EMA | 55.06%: over 50 EMA | 56.85%: over 200 EMA

• SPY formed a gravestone doji on Friday’s session, which can look bearish visually because price failed to hold the gap-up highs and sellers pushed the candle back down into the close.

• That being said, we do not want to overstate the significance of this candle because gravestone dojis are not statistically strong reversal candles. They only act as bearish reversals around 51% of the time, which is very close to random.

• Friday’s intraday range was only around 0.69%, which is materially below the current average daily range of roughly 0.86%. Once the gap is included, the candle looks more dramatic, but the actual intraday range was not a major volatility expansion.

• The bigger concern remains the same one we have been tracking for weeks: SPY has now rallied for roughly six weeks on declining relative volume.

• Since the week of March 30th, SPY has rallied around 15.23% in 32 trading days, which is a very aggressive move in a short period of time.

• That low-volume expansion is still the main cautionary factor because we are not seeing the type of broad volume confirmation that usually gives a clean breakout more durability.

• However, the visible range volume profile is still showing that buyers are aggressively defending pullbacks.

• At Friday’s highs near $724.87, we saw roughly 2M shares traded red versus 1.7M shares traded green, so there was some seller activity at the highs, but not a major imbalance.

• The more important area is the bounce zone near the rising 10-day moving average. Around $711.60, we saw roughly 14M shares traded green versus 10M shares traded red, showing that buyers were still stepping in aggressively on weakness.

• Even more importantly, around the midpoint of the current consolidation range near $714, we saw roughly 6M shares traded green versus only 1M shares traded red, which is a very strong imbalance in favour of buyers.

• This is the reason we are not treating Friday’s gravestone doji as a meaningful reversal signal. The candle itself looks bearish, but the underlying volume profile still shows strong buyer aggression through the middle and lower half of the range.

• SPY is now around 6 ATR multiples above its 50-day EMA, which is hot. This does not mean the rally must fail, but it does mean fresh breakout entries become lower quality.

• The current setup still favours strength and consolidation rather than an outright reversal. The key is that long exposure should now come from weakness into support, not from chasing marginal highs.

Nasdaq

66.33%: over 20 EMA | 65.34%: over 50 EMA | 56.43%: over 200 EMA

• QQQ remains the stronger capitalization-weighted growth index, and the last two sessions were both impressive from a range perspective.

• Thursday and Friday both saw strong range expansion, with the two-day range coming in around 3%, versus an expected two-day average range of roughly 2.6%.

• We also saw a meaningful uptick in relative volume, with both candles pushing above 60% of the 20-day average.

• That is still not a hot relative volume reading, but context matters. The last 20 candles include several high-volume mean-reversion sessions from the late-March / early-April low, which makes the 20-day average harder to clear.

• QQQ is now sitting around 7 ATR multiples above its 50-day EMA, which is very extended for an ETF.

• The message here is the same as SPY, but more extreme: the trend is still strong, but the entry tactic has to change.

• At this level of extension, buying strength is a poor risk/reward setup. You can still take long exposure, but it needs to be on weakness into rising moving averages or clean intraday pullback structures.

• The constituent names inside QQQ are also getting stretched, and we have started to see some mild exhaustion in parts of the Magnificent Seven.

• Nvidia, for example, showed a reversal last week, and several other major growth names are no longer expanding cleanly without pauses.

• This does not mean the Magnificent Seven are breaking down, but it does tell us the easy part of the rally is likely behind us.

• The MAGS ETF is also worth watching closely here. It had a strong bounce on Thursday and attempted to expand higher again on Friday, but it failed to hold that expansion and is now sitting into a dense weekly resistance area.

• QQQ is still a leader, but at this extension level, the best long trades are now pullback longs, not opening range high breakout chases.

S&P 400 Midcap

58.89%: over 20 EMA | 62.65%: over 50 EMA | 57.89%: over 200 EMA

• MDY behaved largely as expected on Friday, with price failing to break cleanly above the $669 area.

• That level is important because the visible range volume profile starts to get denser there, and we are seeing evidence of seller activity around that zone.

• Around $669, we saw roughly 26,000 shares traded green versus 36,000 shares traded red, showing that sellers are becoming more active at the highs.

• This is not a weak chart, but it does explain why price is struggling to accelerate through that level immediately.

• The stronger part of the chart is the bounce from Wednesday, where MDY defended the prior supply zone around $652, which now appears to be acting as support.

• That level also lines up with the rising 20-day EMA, making it an important demand zone.

• From a character-change perspective, this is constructive. Prior resistance has flipped into support, which is exactly what we want to see in a healthy continuation structure.

• We still believe MDY is likely to expand higher over time, but short-term consolidation here would be completely normal.

• The cleanest setup would be more sideways action above the $652–$655 demand zone, allowing the moving averages to catch up before the next attempted push higher.

Russell 2000

65.18%: over 20 EMA | 72.12%: over 50 EMA | 61.69%: over 200 EMA

• IWM remains the strongest capitalization group in the market from a relative strength perspective.

• The Russell 2000 currently has a relative strength rating of around 77 versus the SPX, with QQQ close behind at around 72.

• Small caps are behaving extremely well. We saw a strong bounce on Wednesday and Thursday off the rising 10-day moving average, followed by a green hammer candle on the weekly structure.

• Weekly relative volume only came in around 73%, so it was not a huge volume confirmation, but the price action itself was strong.

• What matters most is that IWM is holding support and consolidating tightly.

• On Friday, IWM closed only around 0.2% above all-time highs, while continuing to tighten inside the range that has been forming since April 17th.

• The worst-case short-term scenario we are watching is a pullback toward roughly $275, where the rising 10-day EMA is currently sitting.

• We would still view that as constructive, not bearish.

• From our perspective, IWM remains one of the best areas to focus liquidity because small caps offer higher volatility and higher average daily range.

• As swing and momentum traders, we want to align with the strongest area where the same directional move can translate into the highest percentage return.

• Right now, that continues to point toward small-cap growth exposure, provided entries come from proper pullbacks rather than chasing extended highs.

FOCUSED STOCK
DAVE: 4 Year Long Cup & Handle Breakout

ADR%: 6.08% | Off 52-week high: -5.2% | Above 52-week low: +167.0%

• DAVE is one of the most important stocks on our radar right now, even though it is not immediately tradable ahead of earnings.

• This was one of the strongest names we traded throughout 2025, and the current structure deserves serious attention.

• On the weekly chart, DAVE has built what looks like an Eve-Eve double bottom structure.

• The first bottom formed between the week of January 26th and February 23rd, before price pushed back higher and rejected the declining resistance level near $225 around earnings during the week of March 2nd.

• The second bottom then formed around the week of April 6th, after which DAVE expanded higher and broke above a resistance level that had held it back for roughly 287 days.

• That breakout happened during the week of April 13th, and now the daily chart is forming a tight volatility contraction pattern into earnings.

• This is why DAVE is important, but also why it is difficult to trade right now. Earnings are in roughly two sessions, which makes fresh swing exposure today low quality unless you are specifically scalping or intraday trading.

• The bigger-picture monthly structure is what makes DAVE so interesting.

• On the monthly chart, DAVE appears to be breaking into a new primary trend continuation rally, with a large cup-and-handle structure that has been building since its 2022 IPO.

• The monthly base has lasted roughly 303 days, going back to June 2025.

• Price held the rising 20-month moving average, pushed off it in April on expanding relative volume, and has now broken above the prior resistance zone.

• This is exactly the type of structure we look for when trying to identify the next major Stage 2 leader.

• DAVE is also important because it sits at the intersection of technology and financials, two areas that can attract meaningful institutional flows when risk appetite is improving.

• The key now is the earnings reaction.

• A strong earnings reaction with high pre-market relative volume would put DAVE firmly on watch for immediate long exposure.

• The cleaner entry would be an opening range high breakout after the first 15 minutes, rather than using a 5-minute opening range high, because the 15-minute structure helps reduce stop-out risk on a volatile earnings gap.

• If DAVE gaps up and then fades lower into the gap fill, we would be watching closely for immediate pullback long entries if buyers step in aggressively.