Situation Awareness: Bullish, but softening at the margins. Yesterday closed the second quarter in style — a 3.9% surge in the PHLX Semiconductor Index dragged the S&P 500 (+0.8%), Nasdaq Composite (+1.5%) and a record-high DJIA (+0.3%) higher, reclaiming nearly all of last week’s pullback. This morning futures fade — S&P 500 futures -15 at 7,534, Nasdaq futures -152 at 30,371, Dow futures -143 at 52,527 — but the briefing frames the weakness as “more tied to mechanics than a specific catalyst” on the first day of H2. SPY/QQQ/IWM cash levels and SMA references are unavailable in today’s data, so treat futures and yields as the tape guide. Trade mode: selective and patient — let the first hour show its hand after a stretched quarter where the “easy money” is arguably made. Today’s context is rate-driven: Fed Chair Warsh speaks in Sintra alongside Lagarde, ISM Manufacturing and ADP hit the tape, and Treasury yields are backing up hard across the curve. Regime context — 65.21% of stocks trade above their 40-day SMA, and the 4% Bull/Bear gauge shows 285 bulls vs. 135 bears. The breadth trend eased fractionally (66.06% → 65.21%, -0.8pp) while the 20-SMA reading held steady, signaling participation is broad but no longer expanding.
SIP: SOC SVRE CELZ INTZ
- What’s working: Continuation/2LYNCH scan is moderately rich with 11 signals led by NVDA, VRT, FTAI; Reversal scan thin at 4 (PG, KGC, FISV, SW). No Delayed 9M signals — momentum-continuation is the play, not fresh reversals.
- Leading sectors (market closed — using prior session tape): Info Technology +2.6% and semiconductors +3.9% led; Industrials +1.4% on electrical-equipment strength. Laggards: Real Estate -2.2%, Consumer Staples -1.5%, Utilities -1.5%, Health Care -1.3%. Rotation firmly favors growth over defensives.
- Key event: Warsh at the ECB forum, ISM Manufacturing (consensus 53.8%) and ADP (consensus 112K) — the first read on whether “higher-for-longer” chatter has teeth.
- Market read: yesterday reinforced that mega-cap tech has reclaimed leadership without breadth deterioration — small/mid caps still participated (Russell 2000 +0.5%). The soft futures are a pause, not a reversal signal, until yields prove otherwise.
- DEP watchlist: no D9M signals today — none to flag.
- SIPS: FTAI, NVDA, VRT from the Continuation scan.