To The Moon

I. Headlines & Catalysts

The market cooled. The Dow closed above 49,000 for the first time ever. The S&P 500 came close to 7,000, then posted its worst single session in two weeks. Price is still elevated, but momentum clearly slowed.

Earnings are reinforcing a familiar theme. Companies that use AI efficiently are printing cash. Everyone else is being judged harshly. Software, semis, and consumer names without a clean growth story are losing investor patience fast.

Macro pressure eased slightly. Markets continue to price in Kevin Warsh joining the Fed in May, viewed as flexible but not reckless. The House passed a government funding resolution, signed after the close, removing a short term risk.

Gold and silver bounced after last week’s flush. Bitcoin stayed stuck between 70K and 80K, moving sideways with very little conviction.

II. Sector Performance Snapshot

The tape showed a clear rotation.

Leaders

• Basic Materials led the board, up nearly 4%

• Energy followed with strong gains

• Consumer Defensive and Utilities also caught steady bids

Laggards

• Technology was the clear drag, down over 2%

• Communication Services and Healthcare stayed weak

• Financials and Consumer Cyclicals also finished red

This was a defensive, inflation-aware session. Capital moved toward cash flow and away from long-duration growth.

III. Technical Breadth & Sentiment Check

Under the surface, breadth is still doing more good than harm.

• 4-week new highs vs lows remain constructive

• Stocks above the 40 and 200 day averages sit comfortably in the neutral to healthy zone

• VIX at 18 suggests no real fear yet

• Put call ratio at 0.84 points to balanced positioning, not panic

That said, short term momentum slipped:

• Nasdaq advance decline fell below its 10 day average

• McClellan Summation Index and Oscillator are softening

Internals are stable, but short term thrust has faded. Most likely a pause than a breakdown.

IV. Earnings & Corporate News

AMD beat estimates across the board, but the stock sold off hard. Revenue grew 34% year over year, yet investors want proof that Helios and large scale AI deployments are shipping, not just planned. The market is done rewarding future promises.

Chipotle shocked investors with its first same store sales decline since 2015. Traffic fell, margins compressed, and expansion plans now look defensive rather than confident.

Super Micro Computer delivered massive revenue growth, but profitability collapsed. Margins were cut nearly in half as costs surged installing next-gen AI systems.

PayPal was the ugliest report of the day. Misses on revenue and earnings, a leadership shakeup, and pulled long term guidance sent the stock to levels last seen in 2017.

On the positive side, Palantir crushed guidance. U.S. commercial demand surged, and the stock cleanly separated itself from the broader software selloff.

Other notable movers:

• Walmart crossed a 1 trillion dollar market cap

• DaVita surged on strong earnings and outlook

• Teradyne hit new highs on AI driven demand

• AES caught a defensive bid as options activity increased

V. Economic Calendar Highlights

Today’s focus is on:

• ADP Employment

• ISM Services PMI

• Crude Oil Inventories

Premarket earnings include Uber, AbbVie, Eli Lilly, Novo Nordisk, and several global financials.

After the close, attention shifts to Google, Qualcomm, ARM, and a handful of large insurers.

This is a data heavy, earnings dense session. Expect intraday swings.

VI. Interpretation & Outlook

Markets are not rolling over, but they are becoming selective. Index levels look strong, while leadership narrows and reactions to earnings turn unforgiving.

This is what late cycle behavior often looks like. Good companies still win. Average stories get punished. Hype without execution no longer works.

Volatility is contained, but direction will depend on whether earnings leaders can keep pulling the market forward.

VII. What I’m Watching and How I’m Trading

I am staying patient here.

This is not a moment to chase strength after a long run. I am focused on risk control, cleaner setups, and sectors showing relative strength without extended price.

Defensive rotation tells me to stay selective, reduce size, and wait for confirmation rather than anticipation. If momentum reappears, there will be plenty of time to press. If it fades further, capital preservation comes first.

Trading indicators are red, so I am not chasing reversals, if any show up. My edge stays with tightening patterns that offer clear, low-risk entries.

Discipline first.

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