Situation Awareness: Bullish. The market is driven by a “peace trade” narrative as U.S.-Iran negotiations show significant progress, sending oil lower and yields down. Index futures are trading well above fair value, with the S&P 500 attempting its ninth consecutive weekly gain. Trade mode: Aggressive breakout on macro catalysts. The tape is responding to geopolitical de-escalation, with the 10-year Treasury yield dropping 8 bps to 4.48% and WTI crude falling 4.1% to $92.65. Regime context — 57.82% of stocks trade above their 40-day SMA, a marginal increase from Friday’s 57.79%, while the 4% Bull/Bear gauge shows 219 bulls vs. 50 bears. The 5-day trend shows a consistent up sequence, with the S&P 500 extending its winning streak to eight weeks.
SIP: MU ROST UBER DELHY
- What’s working: Continuation signals are active with 4 high-quality setups; breadth is expanding as % Above 20 SMA jumped 24 percentage points to 99%.
- Leading sectors: Aerospace/Defense (GE +2.3%), Energy (GEV +3.2%), Medical (WAT -1.0% but high setup quality); leading themes: AI Infrastructure, Peace Deal Beneficiaries, Consumer Discretionary.
- Key event — U.S.-Iran 60-day memorandum of understanding negotiations, potentially opening the Strait of Hormuz.
- Market read: Friday closed with broad strength and record highs for the DJIA; the market is buying the dip on any geopolitical scare, now pivoting to buying the peace deal.
- DEP watchlist: YMM, AVGO, MDLZ
- SIPS: WAT, AMT, GE, GEV