A Weekly Market Intelligence Dispatch · By Anthony Spinella

Charted Territory

No GPS. No guesses. Just price.

The signal is out there. You just have to know where to look.

Section I

Current Conditions

Macro overview — what the water looks like today

The market did what last issue's thesis called for — and then immediately had to defend it. Coming out of Issue 11, the setup was: a healthy pullback off the 100-day, a view that rates may have peaked, and a bullish lean into Q4 seasonality. This week gave that thesis its first real test, in both directions.

The confirmation came fast. Monday and Tuesday delivered exactly the resumption the bullish case needed — the Nasdaq Composite notched back-to-back records (27,122.09, then 27,244.28), its first records since June, while the 10-year yield fell back below 5% as oil cooled. Semiconductors did the heavy lifting: AMD crossed a $1 trillion market cap on its way to an all-time high, Intel gained 12%, Qualcomm added 9%, and the group was up over 4% as a block. Meta was the standout single name of the week, riding strong early traction for its new Muse AI assistant to a roughly 13% weekly gain and pushing the stock to the edge of a $2 trillion market cap — a real turnaround for a name still down about 21% year-to-date. Bitcoin joined the risk-on move too, reclaiming its 50-week moving average and pushing through $87K.

Then the thesis got directly challenged. Wednesday and Thursday reversed the gains as the 10-year yield didn't just retest its prior high — it broke through it, touching its highest level since July 2007, while the 30-year hit a 2004 peak near 5.44%. That's an important, honest correction to make on last issue's call: rates had not actually peaked. The same oil-and-Iran dynamic that drove the whole move in Issue 11 simply reasserted itself, this time triggered by Bessent's threat to shut down Iranian airlines worldwide and exclude any entity servicing them from the dollar system, alongside fresh sanctions on financial institutions in Egypt, Turkey, and Russia. It took a specific new headline — reports that the U.S. and Iran were discussing a phased deal to reopen the Strait of Hormuz — to turn Thursday around intraday, and a further de-escalation signal Friday (progress toward lifting Gulf tanker blockades in exchange for reopening the Strait) to close the week out with real strength: the Dow jumped 478 points, snapping a three-week losing streak, and all three major averages posted weekly gains.

So the honest read on the week: price behaved exactly as the bullish thesis expected — a higher week, fresh records, momentum resuming — but the mechanism wasn't "rates peaking" so much as "the market keeps getting periodically rescued by Iran de-escalation headlines whenever yields spike toward multi-decade highs." That's a pattern now, not a one-off, and it's worth tracking as the actual driver rather than assuming the rate story has resolved.

Net for the week: SPX +1.21%, Nasdaq +2.06%, Russell 2000 the lone laggard at −0.56% as small caps stayed the most rate-sensitive casualty of the whipsaw. The bullish thesis survived its first real test, but it survived on the back of geopolitics doing the market a favor twice in one week — not because the underlying yield pressure actually went away.

Section II

The Depth Gauge

Market internals & breadth — how deep does the move really go?

The divergence between price and participation just kept widening this week. The S&P rallied 1.21% and the Nasdaq surged over 2%, but the percentage of names above their 200-day fell again, to 48.60% from 52.00% — now genuinely below half the index for the first time this series. The 50-day reading fell further too, to 27.60%. That means the vast majority of this rally's gains are concentrated in a shrinking number of names, even as the headline indices post some of their best weeks in over a month.

The put/call ratio's move is worth flagging on its own: it fell to 0.52 from 0.58, meaning options positioning got more complacent even as breadth kept eroding — the exact combination we've called out as risky in prior issues. NYSE net advances did flip positive (314 from −905), consistent with the broad relief rally on Friday's Iran de-escalation news, and the McClellan improved modestly. But those are single-week bounces sitting on top of a structural trend that's now run five-plus weeks: fewer and fewer stocks are actually participating in the advance.

Section III

Dead Reckoning

Technical analysis — navigating by price action alone

The S&P traded a familiar pattern this week: strong opens that faded as rising yields pulled the market lower. That continued through Thursday, when Micron's blowout report Wednesday night couldn't hold the chip bid as the 10-year pushed to 5.34%, its highest since 2002. Price pulled back to a confluence of the 20- and 50-day moving averages near 7,657, then bounced to close the week at 7,722.72.

From here, the technical case for the next leg is intact. Price bounced cleanly off the moving averages, the RSI has plenty of room before overbought, and Friday's weak NFP cut the odds of an October hike to about 17%. That sets up a run into the seasonally strongest quarter of the year, with the S&P finishing higher in 26 of the last 30 fourth quarters. The caveat is that Friday's rates relief was only partial. The 10-year fell to about 5.18% on the report but closed near 5.28%, so the move toward lower yields isn't confirmed yet. That's the line to watch from here.

Section IV

Tide Watch

Sentiment & flows — is the tide coming in or going out?

Sentiment kept easing off the late-September extreme, but it hasn't cleared the hurdle that matters. AAII bulls rose another 2.0 points to 34.6% and bears fell to 46.5%, narrowing the spread to −11.9%. That's still the 11th straight week the spread has sat below its historical average, and bears have now run above average for 34 consecutive weeks. Fear & Greed went the other way, dropping to 31 from 38, drifting toward Extreme Fear while the S&P sits about 1.2% from its record. By our framework, that's a constructive setup: the crowd is nervous into a market that keeps holding up.

The futures data is where this week gets interesting. Commercials grew their net long for a third straight week, to +35,281 from +28,880, so the hedgers have gone from a −50,017 net short three weeks ago to clearly bullish. Large speculators moved the opposite way for the fourth straight week, pushing their net short to −142,499, the deepest of the series. Small specs added a little to their longs at +107,218. The same three-way split from the last two issues is still in place, and the large-spec short keeps widening against it.

One timing caveat: CFTC positioning reflects the prior Tuesday, so this read likely predates Friday's jobs report. The sharp repricing in hike odds isn't in these numbers yet, and next week's COT will show whether large specs pressed their short or covered into the move.

Net it out: retail fear is easing but not gone, Fear & Greed is flashing the kind of reading that has marked bottoms before, and commercials are positioned bullish for a third week. The one holdout is large specs, who haven't stopped adding to their short. If Friday's NFP repricing sticks, they're the group with the most to unwind.

Section V

The Heading

Trade ideas & outlook — here's where we're pointed

For most of this week, the same force that has driven this market all quarter was in control: yields. The 10-year Treasury climbed to 5.34% on Thursday, its highest level since 2002, and the S&P spent the week under pressure until Friday's jobs report changed the conversation. September payrolls came in at just 29,000 against expectations of roughly 85,000, with the prior two months revised down by a combined 60,000. October hike odds fell to about 17%, from about 36% a week earlier. The S&P closed the week at 7,722.72, about 1.2% below its August record, and the Nasdaq was the only major average to finish higher.

That sets up the road into year-end. A pause at the Fed's October 28 decision would ease the pressure behind most of this quarter's pullbacks, and the calendar is on our side: the S&P has finished higher in 26 of the last 30 fourth quarters. From here, our 8,200 year-end target is about 6% away. The caveat is that the relief so far is only partial. The 10-year closed near 5.28%, not far from its high, and December hike odds are still above 75%, so the market has pushed the next hike back rather than taken it off the table. For this to become a real year-end run, yields have to confirm what the jobs report suggested. That's what I'm watching in the levels below.

On the Radar & Game Plan

Sector rotation: Under a flat-looking tape, leadership is narrow and defensive. Only two of eleven sectors sit in the Leading quadrant, Energy and Health Care, and both lost RS-Ratio and RS-Momentum this week. Energy's strength is a refiners trade (Valero, Marathon, Phillips 66) while oilfield services lag, and Health Care leadership sits in just 31% of its holdings. Technology holds the highest RS-Ratio at 104.26 but sits in the Weakening quadrant, with AMD (+29.2% versus its sector ETF over four weeks) doing outsized work. Communication Services crossed into Improving, but it is almost entirely a Meta story (+22.2% relative, with breadth at 22%). Real Estate and Utilities, the most rate-sensitive sectors, deteriorated fastest, and Financials slipped on both axes. This data covers the full week, so it blends four days of yield pressure with Friday's rally. Next week's read will show whether the repricing changes leadership.

BE: Bloom Energy had a volatile week. The stock fell nearly 9% Monday on reports of delays at Oracle's Project Jupiter site, then jumped nearly 11% Tuesday after Oracle reaffirmed the relationship, topping out just above $302 before fading and closing the week at $289.15, essentially unchanged from last Friday's $288.70. The stock continues to hold firmly above the 20-day SMA, but technical momentum is weakening. The MACD has flattened out and is no longer rising, and the RSI has fallen to 58, near the neutral range. To protect gains and stay long, I'm placing a sell stop just under the 20-day, around $270. That sits about 6.6% below Friday's close and locks in roughly a 12.5% gain against my $240 average cost.

AVGO: The next name I'm watching is Broadcom. The stock is well off its highs, trading at $355 versus a peak near $495 earlier this year, a decline of about 28%. The business hasn't followed the price lower. August-quarter revenue of $29.59 billion was up 85.5% from a year ago and about 33% from the prior quarter, with AI semiconductor revenue up 221%. At roughly 19 times trailing sales, down from nearly 30 times in April, the valuation has compressed as the sales have kept growing. The stock is now nearing a critical support zone on the longer-term chart, marked by the red uptrend line. It closed Thursday just under $345 and bounced 3.4% Friday to take it back above. If price can reclaim and hold $345, and momentum returns to the upside, with a rising RSI in step with price, I'll look to add or initiate a position.

Section VI

Off the Chart

Life beyond the screens — dispatches from the road & the water

📍  Colorado Springs, CO

How we doing, and happy Fall! This past week we spent in Colorado Springs, taking a break from the road at my uncle's house. Most days were spent doing our own work, enjoying having a home base for a stretch, and exploring the area. We hit the Garden of the Gods, which was beautiful, and a spot called Red Rock Open Space (not to be confused with the amphitheater). The coolest — and hardest — was the Manitou Incline: a roughly one-mile straight hike up a set of stairs to about 8,600 feet of elevation. We're still acclimating to the altitude here, and saying we felt it on the climb up would be an understatement. It was basically like climbing a never-ending staircase — rewarding at the top, punishing the entire way there.

We also spent the week getting a diesel heater installed in the van, which is funny timing given we spent the last month struggling to stay cool. Turns out it's a lot easier to warm up a small space than to cool one down. We're heading back to Massachusetts this Tuesday to spend time with family and friends, attend a wedding, and get ready for whatever comes next.

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Charted Territory

By Anthony Spinella · Market Intelligence Dispatch

This newsletter is for informational purposes only and does not constitute financial advice.

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