Midday Wave #86: Breadth Flush: When the Rally Gets Quiet – Wednesday 8/12/2026

Welcome to Wave Rider Midday Wave, your mid-session market intelligence. Let's dive in 20 SMA breath, just drop 19 points since the open. The regime's still bullish, but is this rally losing its legs? That's the question, right? Okay, so give me the read, warning versus now, how's the regime holding? Honestly, still bullish, 4%, sentiment, 4% bullish, but the 40 SMA sentiment's got neutral. Right, neutral. Yeah, you know what, in the breath split tells the whole story. 40 SMA breaths at 58.44%, barely down from 60.09% yesterday. Okay, so the intermediate trends find. Fine, but the 20 SMA, that flushed from 115% down to 96%. Wow, wait, 19 points in one session? 19 points, short-term participation is thinning fast. Right, right. And the bull bear count? Narrowed, bull 4% at 191, bear at 99. Yesterday that was 214 versus 157. Yeah, so still net bullish, just quieter. Exactly, like a crowded room where most people are still cheering, but the loudest section just went quiet. I like that. Any leadership left standing? Energy, consumer discretionary, communication services. That's where the strength's concentrating. Okay, so participation's thinning even as the trend holds. Where's that showing up in the actual signals? Perfect example. NXTC, up 14% at $7.67. Oh wow, 14, that's huge. On relative volume of 0.1. Wait, really? 0.1? 0.1, it's a loud firework with no crowd watching. Flashy, unconfirmed. Yeah, so what's the clean one? Look, DGP, up 5.1% at $160 are all right at 1.0. That's your cleanest volume confirmed continuation. Right, right, that's the difference. And ELE, right behind it, up 4.5% at $20.27, volume at 0.9, solid support under the move. Got it. What about the momentum names? Names, NG, FIP, RYTM, all confirming. Energy, materials, biotech. Though RYTM's carrying elevated risk, 88.3%. Oh man, so handle with care. There, handle with care. Now, earnings, this is the caution flag. Go. Here's the thing, fresh stocks in place skew positive. STX beat up 1.93% from open holding. Eat beat on guidance, also holding. Mm-hmm. Okay, so far so good. Right, but here's the thing. The winners that aren't holding, LQDA reported a strong Q2 and it's down 2.92% from the open. Down on a beat? A beat, down on a beat, and STRO faded too. Earnings winners selling off intraday. Yeah, see that's the thing. Good news that doesn't stick. I mean, it's applause dying mid-ovation. And that ties right back to the breath flush. Right, because short-term participations. Then, exactly. Now, the two I'm really watching, VRTX and SPOT. The decision points. VRTX is pressed 0.02% from its supply ceiling at $529.94. Strength read of 8.2. Okay, 0.02%, that's a hair. It's a runner inches from the tape. Break above, it flips from resistance test to full continuation. Mm-hmm. And SPOT? SPOT is sitting 2.47% from its demand zone, $478.77 to $444.17. Bounce thesis is alive only if that zone holds. Right. So basically, confirmed strength, fading pops, two stocks on the line. How does that change the playbook into the close? Stay long the trend, but shift from broad participation to volume confirmed setups only. So trim the NXTC type stuff. Trim or avoid it. Favorite DGP style confirmation. Led volume lead, not the headline percentage. And the levels? VRTX 5.29.94. A break there is your continuation trigger and watch SPOT's demand zone. Lose it, downside opens. What about fresh entries? Lean into that leadership. Energy, consumer discretionary, communication services. So the one line takeaway? The regime's intact, but breath is cooling fast. The edge belongs to volume confirmed setups and sector leaders, not the headline movers. Perfect. So watch VRTX's 5.29.94 and SPOT's demand zone. Those are your cleanest binary signals into the close. Stay selective out there. That's the mid-day wave. That's all for today's episode of Wave Rider mid-day wave. Your mid-session market intelligence. See you next time.