Situation Awareness: Cautious. Major averages pulled back from record highs as mega-cap tech faced profit-taking and oil prices surged on U.S.-Iran conflict escalation. Trade mode for tomorrow: selective and defensive, look for early strength in energy or defensive sectors. Today’s defining context was the collision of geopolitical risk and valuation concerns, halting the market’s 9-day winning streak. Regime context — 44.14% of stocks closed above their 40-day SMA (vs 55.94% prior day, regime held at Cautious), and the 4% Bull/Bear gauge shows 94 bulls vs. 370 bears. The 5-day trend shows a consistent down sequence today, confirming downward momentum after a week of gains.
SIP: MDT ULTA AVGO NVDA HAL
- Winning strategies: 2LYNCH (15 signals) and D9M (5 signals) provided continuation plays, while Reversal Bullish (7 signals) offered dip-buying candidates in software.
- Leading sectors: Consumer Defensive (+0.43%), Energy (-0.10% but oil futures +2.4%), and Healthcare (-0.16% but MDT surged); leading themes: Heavy Construction (+3.43%), Heavy-Duty Trucks & Parts (+2.89%), and Oil & Gas Machinery (+2.63%).
- Key event: Crude oil futures settled at $96.08 per barrel (+2.4%) following reports of fresh strikes between the U.S. and Iran, driving yields higher and tech lower.
- Regime threading: morning SA called Cautious (55.9%), closing is Cautious (44.1%) — held at Cautious due to breadth deterioration but not a full regime shift to bearish.
- DEP watchlist: MDT at $78.04 (9M Catalyst), MRNA at $49.05 (EG100 momentum), and LLY at $1082.48 (Continuation).
- SIPS: LLY at $1082.48 and HAL at $41.03 showing strong institutional accumulation in the Continuation scan.
Market Breadth — 2026-06-03
| Sentiment 4% | Very Bearish | 40SMA | Bearish |
| Bull 4% | 94 | Bear 4% | 370 |
| % > 20 SMA | 62% | % > 40 SMA | 44.14% |
| Bull 9M | 13 | Bear 9M | 45 |