Closing SA — 2026-10-01

Situation Awareness: Correction. Stocks clawed back from a broad morning retreat as the 10-yr yield reversed from a 5.34% overnight high (highest since 2002) down to settle at 5.24%, relieving pressure and letting tech, semis and AI-infrastructure names lead the S&P 500 to a +0.2% finish while the Nasdaq and Dow ended flat; small- and mid-caps outperformed (Russell 2000 +0.5%, S&P MidCap 400 +1.1%), a welcome broadening after September’s narrow tape. Trade mode for tomorrow: selective and defensive ahead of the 8:30 AM jobs report — let the data set the tone before committing. The defining context was the yield round-trip plus a dovish shift (Fed rate-hike odds for October slashed to 23.8% from 37.6%) and another strong AI earnings signal from Micron. Regime context — 18.61% of stocks closed above their 40-day SMA (vs 16.2% prior day, regime held at Correction), and the 4% Bull/Bear gauge shows 153 bulls vs. 147 bears. The 5-day trend is choppy: the 40-SMA breadth ticked up (+2.5pp) while the 20-SMA breadth collapsed (-10pp to 15%), signaling an attempted stabilization that is not yet confirmed.

SIP: MU ACN GOOG COHR

• What’s working: Continuation (2LYNCH) fired 15 signals, D9M 7, Reversal Bullish 16 — momentum in chips/AI-infrastructure dominates the scans.
• Leading sectors: Energy +1.9% (briefing), Technology +0.39%, Consumer Cyclical +0.49%; leading themes: Generic Drugs +4.73%, Business Equip & Supplies +3.75%, Database Software +3.62%.
• Key event: Micron reversed an early post-earnings dip to close +3.03% at $1097.39 after a massive beat and tighter CY27/CY28 supply outlook — AI memory demand validated.
• Regime threading: morning SA called Correction (16.2%), closing is Correction (18.6%) — held, as breadth remains capitulation-level despite the index bounce.
• DEP watchlist: COHR, CRDO, MU, ON, AAOI — strongest D9M AI/semi setups into tomorrow.
• SIPS: MU, GEV, MCK — Continuation swing candidates with institutional sponsorship.