Closing SA — 2026-10-13

Situation Awareness: Cautious-Bearish. The major averages clawed back from sharp intraday losses as a late semiconductor rebound stabilized the tape — the S&P 500 finished essentially flat at 7805.52 (-0.02%), the Nasdaq eased to 27224.82 (-0.15%) and the Dow lagged at 51670.31 (-0.35%); SPY/QQQ/IWM ETF levels are unavailable today. The PHLX Semiconductor Index fell as much as 3.1% at the open on Chinese memory-competition fears (CXMT) before trimming the damage, while JNJ’s -5.73% earnings plunge and Caterpillar’s -3.33% slide kept the price-weighted Dow heavy. Trade mode for tomorrow: selective and defensive — respect the CPI print at 8:30 ET before committing size. Regime context — 32.48% of stocks closed above their 40-day SMA (vs 28.5% prior day, regime shifted from Bearish to Cautious-Bearish), and the 4% Bull/Bear gauge shows 73 bulls vs. 250 bears. The 5-day trend firmed modestly today with the 40SMA breadth up +3.9pp, signaling an early, tentative stabilization rather than a confirmed recovery.

SIP: MWYN VRXA MDT VJET

What’s working: Continuation breakouts fired broadly — 2LYNCH: 16, Darvas Box: 40, D9M: 13, Reversal Bullish: 7. Energy refiners dominated the leaderboard across every scan.
Leading sectors: Energy +0.74%, Utilities +0.71%, Consumer Cyclical +0.42%; leading themes: Biomedical/Biotech +10.75%, Auto Manufacturers +4.70%, Logistics +3.19%.
Key event: Bank earnings deluge — Citigroup (-5.60%) and JPMorgan (-0.86%) faded despite beats, while Goldman (-0.23%) gave back a big EPS surprise; JNJ (-5.73%) was the single biggest drag.
Regime threading: morning SA called Bearish (28.5%), closing is Cautious-Bearish (32.5%) — breadth improved but still deep below the 40% threshold, so the shift is fragile, not a green light.
DEP watchlist: BP, INFY, QCOM, AMD, HOOD — the D9M names holding up best into tomorrow.
SIPS: PARR, PBF, VLO — refiner continuation setups leading the Continuation scan.

Market Breadth — 2026-10-13

Sentiment 4%	Bearish	40SMA	Bullish
Bull 4%	73	Bear 4%	250
% > 20 SMA	15%	% > 40 SMA	32.48%
Bull 9M	9	Bear 9M	12