Situation Awareness: Cautious. Markets are entering a “Peace Dividend” regime driven by a historic U.S.-Iran deal, shifting focus from inflation fears to risk-on sentiment, though technical breadth has tightened significantly following Friday’s rally. Trade mode: Selective and opportunistic on gaps. The narrative is dominated by the geopolitical thaw and the debut of SpaceX, creating a high-volatility opening environment. Regime context — 53.48% of stocks trade above their 40-day SMA, down sharply from 60.1% yesterday, and the 4% Bull/Bear gauge shows 0 bulls vs. 0 bears, indicating a reset in short-term momentum. The 5-day trend turned up 4 of 5 days, signaling a strong recovery phase despite the recent breadth contraction.
SIP: SPCX FOX ROKU PSKY
- What’s working: Continuation signals are thin (7 total) with a focus on high-conviction names; Reversal signals are active (12 total) in the software sector, suggesting a rotation out of laggards.
- Leading sectors: Technology (driven by SPCX IPO and semiconductor rebound); Media/Entertainment (driven by M&A); Aerospace/Defense (geopolitical resolution). Leading themes: Geopolitical Peace, AI Infrastructure, M&A Activity.
- Key event: U.S. and Iran peace deal signed Friday in Switzerland; SpaceX (SPCX) begins trading at $170.00.
- Market read: Friday’s close saw modest gains, but the overnight reaction to the peace deal has created a massive gap-up environment. The tape will be driven by the “fear of missing out” on the peace rally and the speculative fervor around SPCX.
- DEP watchlist: SPCX, FOX, PSKY, WBD, RACE.
- SIPS: CELH, AMP, FN.