Next Day Prep #222: Oil Crashes 11.5%, S&P Barely Moves — What the Market Is Telling You – Tuesday 3/10/2026

Welcome to Waverider Next Day Prep. Review today, prepare tomorrow. Let's dive in. Oil just had one of its biggest single-day crashes in years, down 11.5%, and the S&P 500 barely flinched. That's not a nothing day. That's a market telling you something important. Let's figure out... What? I mean, and that's exactly the right question, because the answer tells you everything about what kind of market we're actually in right now. OK, so, right, right. OK, so walk me through what actually happened today, because on paper, that number looks insane. So oil hit $83.85. Massive deflationary relief there. But then you've got these Iranian naval mine reports in the Strait of Hormuz keeping everyone on edge. The market wanted to rally on the oil relief, but couldn't commit because the geopolitical threat hasn't actually resolved. It's like two equally strong teams in a tug of war. Lots of energy being spent, but the rope barely moves. Right. Huh, yeah, that's exactly what it felt like watching the tape. Right. And you could see it in the sectors. Semis up 7 tenths percent. Communication services up 3 tenths. But energy down 1.3. Healthcare down 7 tenths. Oh, wow. Like, wait, semis up while energy is down? Those usually move together on an oil shock. what's different here? Yeah, and that's the thing. Lower oil prices reduce input cost expectations, right? Plus, the Iran fear kept money in tech defensives rather than rotating into energy. So you got this weird dynamic where... Where the usual correlations just broke down completely. Exactly. And breadth was still bearish. Only 40% of stocks above their 20-day moving average, sentiment reading at a neutral 4 I mean the breadth numbers alone tell you the market churning not trending Yeah You know what OK so what the lesson for how we pick setups on a day like today VRTX gained 8.3% in a market that went nowhere. Meanwhile, the software ETF dropped 2.3%. Mm-hmm. VRTX at $499.17 was textbook catalyst-driven breakout. Kidney drug trial results gave it its own engine, completely independent of macro. So it basically didn't care what oil was doing. Right, and made its own weather. Right, exactly. It's like surfing. Continuation signals need a wave underneath them. But VRTX created its own wave. Software continuation plays, sector gravity pulled them down regardless of setup quality. Ugh, brutal. What about Meta and Alphabet holding up? Honestly, Meta held at plus 103, Alphabet plus 30 basis points, but only because they had their own earnings momentum story. You know what's wild, though? The signal breakdown. 115 reversal signals versus only 48 continuation signals. That's more than two and a half to one. Wait, 115 reversal signals to 48 continuation signals? That's a pretty dramatic skew. What does that ratio actually mean for how we should be trading right now? Right now? I mean, when reversals outnumber continuations by that margin, the market is like a crowd at a crosswalk. Everyone shifting weight, nobody stepping off the curb. Biotech was mixed too. ADCT positive on Q4 results, ESPR disappointed. In healthcare, like catalyst selectivity is basically non-negotiable. Yeah. So the market is churning, signals are mixed, and the one clean trade was a biotech with its own story. That brings us to tonight because Oracle just reported after the bell and what happens there could reset the entire software narrative for tomorrow Oracle closed down 1 heading into earnings already under pressure with the rest of software Right Walk me through what a beat versus a miss means for tomorrow's tape. Here's the asymmetry. A miss here is more dangerous than a beat is helpful. The sector's already wounded and confirmation of weakness tends to accelerate selling faster than a beat can reverse it. So basically the downside scenario is the one to really game plan for to... Tonight? Well, I wouldn't say ignore the upside, but yeah, the asymmetry is skewed bearish. A miss hits harder than a beat helps right now. Beat scenario gives software a lifeline, gap up opportunities and oversold cloud names. Miss scenario validates today's sell-off, could accelerate selling at the open. Honestly, Oracle tonight is more of a risk management event than an opportunity event. Exactly. Huh. That's actually a really good way to frame it. And look, tomorrow's calendar is essentially empty. No CPI, no significant Fed speakers, which means the market has no scheduled catalyst to override the geopolitical narrative. Overnight Iran developments become the primary variable. It's like Oracle's earnings are the opening act. If they bomb, the whole crowd's mood shifts before the headliner even takes the stage. Right, right. All right. Oracle results pending Iran as the overnight wildcard, market churning rather than trending, let's build the playbook. SPY closed at $4148, right in the middle of that range, right? Yeah, smack in the middle of $4180 resistance and $4120 support. So give me the watch list. Top three names, what are we watching for? Mm-hmm. VRTX is the top watch at $499. The 500 psychological level is like a toll booth, needs volume to pay the toll stalls without it AAOI at existence is the decision point Okay and NCI NCI at with a 15 explosive move across multiple momentum scans. I mean, NCI moved 15%. Isn't that already extended? Why is that still on the list? The move is big, but the consolidation setup is what matters. needs to hold $11.50 to confirm the base. If it does, that's the entry signal, not the 15% move itself. Right. So the entry isn't the move itself. It's the consolidation after, exactly. And oil bounce plays like UCO are explicitly off the table until crude shows a confirmed floor. OK, so gap up. What does that actually look like in practice? Iran tensions de-escalate overnight. growth stocks lead, SPY targets 4180 resistance, lean into VRTX continuation, and watch beaten down software names for bounce setups. Yeah, totally. And the ugly version. Yeah, and honestly, the traders who blow up in tapes like this are the ones who think they can force it. You can't force this market right now. Oh, man. Look, you really can't. In a stalemate market, the only reliable momentum comes from names with their own catalyst engine. VRTX proved that today. Oracle and Iran answered the next question overnight. Set your alerts on VRTX at $5, AAOI at $12.50, and NCI at $11.50 before you close the screen. Know your gap up and gap down response before the open, because in this tape, the traders who are prepared are the ones who stay profitable. We'll see you tomorrow. That's all for today's episode of Wave Rider Next Day Prep. Review today. Prepare tomorrow. See you next time.