Quick Recap

The index’s gapped up overnight off Iran peace discussions, right into potential resistance. Just wanted to put out a quick update but locking profit at open feels like the right move here but we shall see. For now, we want to see if we can break through resistance, 6800 will be key for SPX for upside, 6500 as support below.

Look at the similarities here to 2022 (I am not trying to perma-bear here, just an observation).

Even the weekly RSI bounce level is at the same spot.

SPY Levels

Large Prints From Today

EWY - South Korea ETF, with the #1 Cluster

SPXL - $200M Print Today, likely profit taking for the 3x SPY ETF

Final Thoughts

My lean is that this move fades but could hold up into Opex, CPI print incoming though and could spike volatility. Watch for that 20 level on the $VIX.

Key reminder is that this is a Mid-Term Year, lots of volatility is likely throughout. Survive into November with plenty of cash to deploy and enjoy the the upside.

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Top Q2 2026 Trade Ideas

A thesis without respect for price action and timing is just a story. Think of this list as a curated wishlist—once key levels are tagged or catalysts line up, that’s when these ideas graduate into high‑conviction trades. Q2 marks the start of a new journey: historically it opens a Q2–Q3 window of weakness in midterm years, but that doesn’t mean “short everything.” It means navigate the volatility with intention, embrace the adventure it brings, and use the chop to set up great buying opportunities for later in the year.

“In markets, conviction matters, but so does turnover. You have to turn the book over when the world changes.” - Stanley Druckenmiller

Now lets dive in.

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1. Embrace Midterm Volatility — Build the November Buy List

Theme: Midterm years are built for two corrections, sometimes with one very deep shot. This is not a bug; it’s the feature that creates forward opportunity.

• Seasonality: Historically, midterm years see choppy, negative skew in the Q2–Q3 window, then some of the best 12‑month forward returns from early November entries, with a near‑perfect hit rate in past cycles.

• Playbook:

  • Sell rips, buy dips with a long‑term hat on.

  • Use volatility into October to accumulate best‑of‑breed names rather than chase whatever just bounced.

  • Treat November’s first‑week seasonality as a major deployment window, assuming technicals and macro confirm.

• Tools: Index and sector puts, overwriting, and staggered limit orders in names you want to own for 3–5 years. One underrated option for that 1st week of November is something like the 2x ETF for the Nasdaq - QLD

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2. Fade the Korea Bubble (KOSPI / EWY)

Theme: The Korea bubble looks late‑cycle, with massive prints hitting at the top and prior analogs pointing to very large drawdowns once the music stops.

• Thesis: Historically, Korean equity bubbles have resolved with ~50% average declines from peak once they finally roll; current flows and price behavior rhyme with those prior endings.

  

• Flow tell: VolumeLeaders is flagging huge prints in Korea exposure near the highs, the kind of activity that usually shows up when big money is transferring risk, not initiating fresh, patient longs.

  

• Expression:

  • Direct: Short EWY or EWY put spreads.

  • Macro: KOSPI futures / options for those with access and risk tolerance.

• What I’m watching: Exhaustion spikes, failed breakouts, and a transition from buy‑the‑dip to sell‑the‑rip behavior on daily/weekly charts.

3. Fade the Oil Spike — USO

Theme: The Iran‑driven oil spike has morphed from opportunity to crowded consensus; prints are starting to scream profit‑taking, not fresh accumulation.

• Thesis: Every major economy on earth wants crude lower, geopolitical premiums don’t stay bid forever, and VolumeLeaders is now flagging selling/program exits in USO and related exposure.

• Expression:

  • Direct: Short USO or USO put spreads.

  • Indirect: Short high‑beta energy laggards that underperform on the way down.

• What I like: Fading parabolic spikes into resistance with flow confirming distribution, not panic buying.

4. Long Quality Software — IGV

Theme: While semis and front‑of‑the‑tape AI names tire, high‑quality software has quietly attracted serious size with a much cleaner forward return profile.

• Thesis: IGV has now seen massive, coordinated prints that historically line up with favorable 6–12 month forward returns, especially when coming off corrective phases.

• Risk: IGV’s fate is still tightly tethered to MSFT, and there is non‑trivial fundamental risk around the OpenAI relationship and AI capex digestion. But, even MSFT enters a favorable setup here.

• Expression:

  • Core: IGV shares for cleaner, lower‑decay exposure.

  • Overlay: Lightly sized calls or call spreads for upside leverage into strength.

• Playbook: Buy pullbacks into support / print zones and avoid chasing vertical days; this is a “let institutions do the heavy lifting” trade.

ServiceNow (NOW): Don’t Bet Against the Workflow OS

Theme: In the same software lane, ServiceNow stands out with both a monster fundamental runway and supportive flow/forward return data.

• Thesis: AI doesn’t kill workflow platforms; it makes them more valuable. NOW sits at the center of digital workflows and is positioned to monetize AI‑driven productivity gains across IT, employee, and customer workflows. Forward returns off similar accumulation regimes have been strong.

• Expression:

  • Structural: LEAP calls (12–24 month tenor) to express a secular compounding view without overtrading noise.

  • Supplement: Stock for those wanting delta without optionality decay.

• Risk: Multiple and expectations are high; timing entries around pullbacks to key support is key.

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“Smart Money” and Transports

Every cycle has a handful of signals that don’t show up on CNBC tickers but matter a lot more than the day’s headline. For the last two decades, one of those tells has been hiding in plain sight inside the iShares Transportation Average ETF (IYT) — specifically, in massive dark pool prints that only the biggest players can put on.

Transports sit at the heart of the real economy. When goods stop moving, growth slows. When institutions capable of trading hundreds of millions in a single off‑exchange block quietly reposition in IYT near cycle peaks, they’re usually not reacting to today’s news flow; they’re pricing in the deterioration that hasn’t shown up in the data yet.

data flags two prior episodes where anomalously large IYT dark‑pool prints appeared near S&P 500 highs: April 21, 2008 and June 14, 2021. Both ultimately led to negative 12‑month SPX returns, despite very different macro backdrops. A third signal just fired in April 2026.

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How the IYT Dark Pool Signal Is Defined

The prints in focus are not routine institutional flows. They are outsized, clustered, off‑exchange blocks that rank among the top VolumeLeaders positions in IYT — #1 and #3 in the 2008 cluster, #6 in 2021, and a new, similarly sized print in April 2026.

Key traits:

• Anomalously high dark‑pool volume relative to normal IYT activity.

• Occurring near prior or developing SPX highs, not in the middle of obvious panic.

• Likely placed by entities with significant macro visibility and risk‑management mandates.

The hypothesis: when smart money chooses that moment to move aggressively in Transports, it is often marking the transition from late‑cycle complacency to a deterioration phase in broad equities.

What Happened After the First Two Signals

Episode I: April 2008 — False Stability Before a Crash

By April 21, 2008, the S&P 500 had already pulled back from its October 2007 high of 1,561 but was attempting a recovery. Price action looked “good enough” to lull investors into complacency. That is exactly when the big IYT dark‑pool prints hit.

Forward SPX performance from that signal:

• 1 week: +1.15%

• 1 month: −1.57%

• 2 months: −8.55%

• 3 months: −10.02%

• 6 months: −37.28%

• 12 months: −38.03%

The Lehman collapse in September 2008 turned steady deterioration into a historic crash. From the April signal close to the March 2, 2009 trough, SPX fell −51.1%, and −56.2% peak‑to‑trough from the 2007 high. The IYT signal gave roughly 47 weeks of advance notice before the generational low.

Episode II: June 2021 — A Longer Fuse, Same Direction

The June 14, 2021 signal behaved very differently in the short term. Rather than rolling over immediately, the S&P 500 pushed higher for six more months, peaking in late December 2021 at 4,766 — about +14.4% above the signal level. On the surface, it looked like another buy‑the‑dip cycle.

But the 12‑month math rhymed with 2008:

• 1 week: +2.74%

• 1 month: +3.86%

• 2 months: +6.61%

• 3 months: +6.40%

• 6 months: +10.90%

• 12 months: −11.8% by June 13, 2022)

The bear ultimately bottomed on October 10, 2022 at −14.0% from the signal and roughly −24.9% from the December 2021 peak. Different catalyst (Fed rate shock instead of a banking crisis), same story on a 12‑month horizon: the IYT print appeared near the end of the good times.

Different Short-Term Path, Same 12‑Month Destination

If you re‑index both episodes to 100 at the signal date and look 52 weeks forward, you see the defining feature of this pattern:

• 2008: rapid deterioration, deep crash.

• 2021: small runway of index gains, then a grinding bear.

Yet both paths resolve below the signal price by 12 months. The shape of the path differs; the direction at one‑year does not.

Structurally, both signals share another important trait: they fired during periods of apparent stability or gentle recovery, not at obvious moments of stress. When large dark‑pool buyers in Transports step in during those windows, they are usually early to the turn — not chasing fear.

April 2026: The Third Signal Just Fired

The new IYT dark‑pool print — structurally similar in size and context to the prior two — has now appeared. On a 20‑year weekly chart of the S&P 500, you can place three markers:

• April 2008

• June 2021

• April 2026

The first two bookmarks align with the onset of major bear markets. The third sits at the far right edge of the chart with the index near all‑time highs.

Forward return outcomes for this new signal are, of course, pending:

• 1W, 1M, 2M, 3M, 6M, and 12M horizons are all to be determined.

• The 2021 episode shows a six‑month window of further upside is possible after the print.

• The 2008 episode reminds that deterioration can also begin almost immediately.

What the pattern has not done historically is resolve into a benign, positive 12‑month return. Both prior instances produced negative one‑year SPX performance, with drawdowns ranging from moderately painful to catastrophic.

How to Use (and Not Use) This Signal

There are important caveats:

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There are very few companies in the software world that have earned the right to be called compounding machines. ServiceNow is one of them. From a niche IT service management platform to the de facto operating system for enterprise workflows, $NOW has executed its expansion playbook with remarkable consistency — growing gross profit at a 28% CAGR and free cash flow at a 32% CAGR over the past eight years.

And yet, as of April 2026, $NOW sits more than 50% below its all-time high. The stock is showing a weekly RSI below 30 for the first time in years. The kind of setup that historically has preceded significant multi-month recoveries.

This report presents the data-driven bullish case for $NOW — combining quantitative forward return analysis across two distinct signal types with the fundamental picture underpinning a company that has never stopped compounding.

$NOW is simultaneously triggering two historically rare signals: a weekly RSI below 30 (4 episodes since IPO) and a drawdown exceeding 50% from all-time highs (3 prior episodes). Both signals, analyzed independently, show strongly positive forward returns across every medium-to-long timeframe.

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Signal One: Weekly RSI ≤ 30

Weekly RSI sub-30 readings on $NOW are genuinely uncommon. Since the company went public in 2012, it has triggered this level exactly 4 times — including the current episode. That rarity matters: it means the signal isn’t noise. It’s exhaustion.

The chart below shows all RSI ≤ 30 episodes highlighted on the full price history, with the corresponding forward return table beneath it. The results are striking.

The 1-week return is modestly negative at –1.19% with a 50% win rate — no edge in the very near term, which is consistent with capitulation selling that doesn't stop on a dime. But the data improves dramatically as the timeframe extends:

The 3-month and 6-month windows are the standout figures: 100% win rate with average returns of +36.69% and +35.69% respectively. Every prior instance of $NOW triggering weekly RSI ≤ 30 was higher 3 and 6 months later. That's the kind of historical consistency that deserves serious weight — especially when layered on top of a second confirming signal.

Signal Two: ≥ 50% Decline from All-Time High

Independent of RSI, $NOW is also currently trading more than 50% below its all-time high — only one other instance since the company went public. Drawdowns of this magnitude in a quality compounder are extraordinary events. They occur during periods of maximum fear, broken narratives, and indiscriminate liquidation.

History shows they are also extraordinary buying opportunities.

The Fundamental Engine Hasn’t Broken

Technical signals only matter if the underlying company still has the capacity to recover. With $NOW, the fundamental picture remains intact — and in many respects, it’s stronger than it’s ever been.

The financial trajectory here is as clean as it gets in enterprise software. Three key metrics, all compounding in the right direction over an eight-year span:

Free cash flow growing faster than gross profit tells you the operating leverage is real — as the business scales, margins expand. This is the hallmark of a software platform with durable pricing power and high net revenue retention. ServiceNow doesn't grow by discounting. It grows because enterprises can't afford to rip it out.

What ServiceNow Actually Does — and Why It’s Hard to Replace

ServiceNow started as an IT service management platform (think: the system your IT department uses when you submit a help desk ticket). Over the past decade, it has expanded far beyond IT into HR service delivery, customer service operations, legal, procurement, and now agentic AI workflows — all built on a single unified platform called the Now Platform.

The strategic advantage ServiceNow has built is not any single product — it’s the platform gravity. Once an enterprise runs IT, HR, and customer operations on the Now Platform, the cost and complexity of switching is prohibitive. This creates the durable retention and expansion motion that underlies the FCF compounding machine visible in the financials.

The generative AI tailwind is real and meaningful here. Unlike companies building standalone AI products, ServiceNow is embedding AI natively into existing mission-critical workflows. Customers don’t need to buy a new tool — they upgrade within the platform they already depend on. That’s a fundamentally superior GTM motion in a budget-constrained enterprise environment.

What’s Driven the Drawdown — and Why It Doesn’t Change the Thesis

Understanding the drawdown context is important. $NOW has declined from its peak for a combination of macro and stock-specific reasons — none of which appear structural:

The Confluence of Signals — Why Now Matters

What makes the current setup unusual is the simultaneous triggering of two historically independent signals. The RSI sub-30 reading and the ≥50% ATH drawdown are both rare events — and they have not always occurred at the same time. Their current overlap creates a higher-conviction setup than either signal in isolation.

Across both signals combined, the 3-month and 6-month forward return data is remarkably consistent:

Three to twelve months out, the historical base rates are unambiguous. This doesn't guarantee any outcome — no forward return analysis does. But it should inform how you size and structure exposure when a company of this quality reaches a historically rare technical extreme.

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How to Think About Sizing and Structure

Given the data above, the question becomes: how do you actually express this thesis? A few frameworks worth considering:

1. Staged equity accumulation. The 1-week data is coin-flip — which means timing precision is unlikely to help in the immediate term. Averaging into a position across 2–3 tranches over 4–6 weeks captures the signal without betting on a single entry.

2. Options for premium collection. Elevated implied volatility at these price levels creates attractive premium. Cash-secured puts at strikes you’d be comfortable owning shares allows you to either collect yield or acquire shares at an additional discount — both favorable outcomes.

The Bottom Line

ServiceNow is not a broken company. It is a category-defining enterprise software platform with nearly a decade of consistent financial compounding, an expanding AI product surface area, and deep institutional entrenchment across its customer base. The current drawdown reflects a toxic cocktail of macro fear, multiple compression, and sentiment — not fundamental deterioration.

The quantitative signal is clear: in every prior instance that $NOW has traded at weekly RSI ≤ 30 and/or declined ≥ 50% from its all-time high, the stock has recovered materially over 3–12 month horizons. Both signals are active simultaneously today.

Quality on sale, confirmed by two independent historical signals, backed by one of the strongest FCF compounding records in enterprise software. That’s the $NOW setup heading into April 2026.

I share these type of reports weekly for free subscribers and I’ll be publishing my “Top Trade Idea’s of Q2” soon for paid subscribers, be sure to take advantage of my end of quarter deal. If you enjoyed the content, a follow, share, subscribe, restack, is huge support so thank you. Hope you all enjoy a strong Q2. Cheers!

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The Indicator That Keeps Finding the Bottom

Let’s start with the one that has been the most consistent in my own work: SKTH, which tracks the percentage of S&P 500 Information Technology stocks trading below their 200-day moving average.

The 200DMA is the gold standard for trend definition. When a stock is below it, it’s in a long-term downtrend by most definitions. When the majority of an entire sector is below it, you’re looking at capitulation-level selling — the kind that historically precedes meaningful recoveries.

Here’s the track record:

Four distinct macro events. Four different catalysts. One indicator that consistently identified the inflection point. That's the kind of signal worth building a process around

Small Caps: Where RSI Really Breaks Down

If there’s one area where relying on RSI alone will consistently hurt you, it’s small caps. The Russell 2000 ($IWM / $RUT) is inherently more volatile than large caps — individual names swing wider, liquidity thins out faster, and the index can stay technically oversold for extended periods during risk-off episodes.

The fix is straightforward: instead of looking at price-based momentum like RSI, look at what percentage of small-cap stocks are trading below their 50-day moving average. The 50DMA is the right lens here because small caps move faster — the 200DMA often lags too much to give timely signals in this space.

When the breadth reading reaches extremes — say, 70-80%+ of $IWM components below the 50DMA — you’re approaching the territory where the risk/reward for longer-term swing entries becomes compelling. Not because every stock is about to rocket, but because the conditions for a mean reversion across the index are in place.

This single adjustment to your small-cap process can meaningfully improve your entry timing and help you avoid the painful experience of buying what looks cheap — only to buy it cheaper again two weeks later.

It Works Across Every Sector

Here’s where this framework becomes particularly powerful: every major sector has its own breadth indicator, and they’re all available natively in TradingView.

Whether you’re trading Healthcare, Financials, Energy, or Tech, you can pull up the % of stocks below their key moving average for that sector and use it to calibrate how stretched the selling really is. A sector-specific reading gives you context that a broad market indicator can’t — because different sectors often bottom at different times during a correction.

Each of these sectors has periods where it leads or lags the broader market. By tracking breadth at the sector level, you can identify which pockets of the market are reaching washout conditions — even when the headline index still looks relatively healthy.

How to Use This in Practice

Here’s a simple, repeatable process for incorporating these indicators into your market analysis:

The Bottom Line

Chasing waterfalls — buying into steep drops hoping to call the bottom — is one of the most expensive habits in trading. The instinct to buy cheap is sound. The execution, without context, is where traders get hurt.

Market breadth indicators built around moving averages give you that context. They answer the question RSI can’t: not just is this oversold, but how does this compare to every other time the market has sold off? When the answer is “this is historically extreme,” the risk/reward for patient, conviction-based entries shifts dramatically in your favor.

The 2018 Christmas Crash. COVID. The 2022 Bear Market. The 2025 Tariff Tantrum. The signal has been there each time. The question is whether you’re watching for it.

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I track market breadth readings across all major sectors and share them with members each week — along with trade setups, macro context, and options flow analysis.

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Quick Update

Just wanted to take a moment and thank everyone for the support and to celebrate such an incredible quarter. We’ve had some great wins and navigated a challenging market. Kudo’s to the OG early members, hope you have enjoyed some great gains and looking forward to many more successful quarters ahead.

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Our scorecards below show how our Forecast and Q1 Trade Idea’s performed (not even including our weekly calls)

To celebrate, please share out these gift subscriptions to friends navigating these markets and send me a message for what you want to see more of in Q2 and beyond.

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Future’s are rallying overnight off WSJ news that Trump is willing to pull out of Iran with or without the Strait being open. This appears to follow the path I shared in the

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This week’s trade plan will be tighter and more tactical after the heavy lift of the Q2 Market Outlook. We came in with elevated cash and have been scaling in; if we see

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Welcome to my Q2 - 2026 Market Outlook—coming off a quarter where our Q1 playbook for a stretched, mean‑reverting market, narrow leadership, and rising volatility played out almost point for point. I had Claude run an analysis and grade the Q1 Outlook, I’ll be doing this each quarter for the Outlook and the Quarter Trade Idea’s.

As we turn the page, the backdrop has become even more fragile: Iran-related tensions have sparked an oil shock, financials are trading weaker than they did through much of the 2022 bear phase, and cracks in credit are no longer theoretical. At the same time, AI is reshaping how investors think about software businesses, productivity, and the future of job growth, creating a powerful secular tailwind sitting on top of an increasingly late‑cycle tape.

I break down what this new regime means for risk, where the durable opportunities still live, and how to position into Q2 as markets reprice both complacency and possibility. Let’s dive in.

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The Midterm Year Playbook: Putting the Odds in Your Favor

“The smallest historical drawdown has been -7.4%, while the largest was -41.8%. What determines which scenario plays out? Leverage, sentiment, and earnings growth. Right now, we’re sitting with accelerating leverage, sentiment that’s elevated but not panicked, and a market that’s priced for perfection.” - Quote from the Q1 Outlook

Equities are already down more than 7% off the highs as of this writing, but the real story is under the surface: former leaders are down multiples of the index, and fear is building fast in both price action and positioning. The tape is transitioning from orderly distribution to something closer to a rolling de‑risking, and for the first time this cycle investors are starting to question whether the prior “buy every dip” regime still applies.

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Seasonality and the Midterm Window

• We are now stepping into the weakest stretch of the calendar in midterm years, historically the Q2–Q3 window where returns tend to be muted and drawdowns more frequent.

• That seasonal backdrop matters because it is arriving just as leadership thins out, breadth deteriorates, and key sectors roll over, amplifying the risk that a routine pullback morphs into a deeper corrective phase.

Technical erosion and risk posture

• The technical picture has moved from “overbought but intact” to “clearly deteriorating,” with major indices breaking short‑term trends and an increasing number of prior leaders losing key support levels.

• In that environment, Q2 is not the time to fight the tape; the playbook shifts toward staying defensive—selling into strength, respecting failed breakouts, and using rips to systematically raise cash rather than press risk.

Strategy through Q2–Q3

• The goal through the middle of the year is not to perfectly nail the bottom, but to preserve capital and optionality until both price and data start to align on the upside again.

• Historically, some of the best risk‑reward in midterm years appears when buying in early November, where the first week has an excellent track record in past cycles, making it a natural window to get more aggressive once the technical and macro backdrop start to repair.

  

My base thesis for Q2 2026: Potential for strong rally early in the quarter, followed by continued weakness.

The first half of April will be an important tell: whether oversold conditions are met with real demand, or whether rallies are sold quickly will help confirm whether we are in a standard correction or something more prolonged.

Already, the market is validating many of the risks flagged in the Q1 outlook—narrow leadership, elevated sentiment, and late‑cycle dynamics—which argues for patience now so there is dry powder available when the odds finally tilt back in your favor.

1. Watch for Trump Levers - Just like in the Q1 report, I mentioned Trump creates additional volatility and several think he could turn this around quickly, while this isn’t my base case it is something to watch for.

   

2. Financials and the MOVE Index — Bond and credit markets are quietly validating the equity message: risk is rising, not falling. The spike in the MOVE Index is a clear tell that rate volatility has returned in force, and with it a higher probability of accidents in duration‑heavy balance sheets and leveraged credit structures. At the same time, financials have materially underperformed, starting the year in a weaker posture than they did even during the heart of the 2022 bear phase, which is not what you want to see if the system is “all clear.” I think this is something to keep a close eye on and keep your mind open to something more serious lurking around the corner.

   

3. Energy and Oil Price’s — The Iran conflict has turned what was already a fragile tape into one that must now discount an exogenous shock: the spike in oil prices. Energy has flipped from being a quiet tailwind to a potential choke point for growth, margins, and ultimately equity multiples. What happens next in this conflict will be critical, because when crude spikes, index-level returns have historically struggled as higher input costs, tighter financial conditions, and weaker sentiment filter through the system

Sector Opportunities

IGV - Software

Currently testing this support zone for the 5th time with terrible sentiment. There are a few select companies in the sector I love at current levels but have to remember where we may be in the cycle. Because of that, I like to scale into the companies I prefer and lean into the idea software could bottom sooner than maybe some other sectors. There is an unfilled gap in on that 2nd blue line in the 73’s I think could be a great spot to position into.

TLT - Bonds

Contrarian trade? Perhaps. But on the other side of this oil shock the economy will likely be in shambles and with the job market already weak, the idea that this flips quickly isn’t unreasonable.

IHI - Med Device

One of the few sectors that can align well as a trading vehicle in bear and bull environments. Notice how in 2022 this reading was often a good buy spot for a bounce. The companies within include names such as ABT and MDT. We are also nearing the uptrend from the 2020 Covid Lows.

Crypto in Midterm Years: Is Bitcoin a Buying Opportunity yet?

Similar to equities, the 1st Half of Midterm Years is often the weaker window, my lean is to accumulate starting the 2nd half of the year with an expectation of a bottom in October similar to other cycles.

“This isn’t bearish long-term; it’s cyclical. Bitcoin likely corrects 30-40% into Q1-Q2 2026, testing the $43,000-$50,000 range. This would be consistent with the historical midterm pattern.” - From Q1 Outlook

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Final Thoughts:

Seasonals and technicals are aligned in a way that argues against heroics. Historically, the Q2–Q3 window of midterm years is one of the weakest stretches for equities, and this time that seasonal soft spot is colliding with eroding breadth, failed breakouts, and leadership that is finally buckling. This is not the tape to fight. Q2 is better approached from a defensive stance—selling into rips, trimming exposure in names that have broken trend, and steadily raising cash through the year. The goal is not to nail the exact low, but to preserve capital and optionality so size can be put to work when the odds turn. History suggests that in midterm years, some of the best risk‑reward shows up in early November, where buying that first week has had a remarkably strong track record; that remains a key window on the calendar, provided the technical and macro picture begins to heal.

“The strategy is straightforward, even if the environment is not: protect capital, lean defensive, use strength to upgrade quality and raise cash, and let the ongoing reset in equities, bonds, and credit play out.”

There will be a time to get aggressive again—likely when seasonality, technicals, and macro all begin to rhyme on the upside, potentially around that historically powerful early‑November window in a midterm year. Until then, the edge lies in discipline: surviving the volatility, so you are fully able to exploit the next sustained opportunity set when it finally arrives.

I’ll be publishing my “Top Trade Idea’s Q2” soon for paid subscribers, be sure to take advantage of my end of quarter deal. If you enjoyed the content, a follow, share, subscriber, restack, is huge for supporting the page. Thank you and hope you all enjoy a strong Q2. Cheers!

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• Q2 2026 Trade Idea’s (with full company reports and setups)

• Top 10 Longs of 2026

• Trading Indicator Primers

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• Deep Dive Company Reports (ongoing throughout 2026)

• Live Trade Updates and Exact Levels (for all major catalysts)

• Private Discord Group (ask questions, share ideas, get real-time market color)

Where are We?

After the weakness on Friday, we kicked the week off with some green candles but since then we have stayed contained within that 659-651 range. On the daily candles below you can clearly see the range. When thinking about recent price action and the macro backdrop its easy to fall into a trap of having the right thesis on the market but just the wrong time frame. The time frame will depend on the setup in front of you and what is your actual goal. By goal I mean are you an active day or swing trader? Are you looking solely for medium to longer term investments?

Asking yourself that question will also determine where we are in the market. Below I’ll share the best short term setups I see heading into the rest of this week and gearing up for Q2. The short and long term trades I am seeing here are some of the best of the year in my view. Lets dive in!

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Short Term Time Horizon Setups (Active and Swing Traders)

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Leaning Into Financials With AXP

American Express and the broader financial sector are lining up on several fronts right now, creating what looks like an attractive risk‑reward window into April. Dark‑pool buyers stepped into AXP on Friday, and price has already started to respond, suggesting informed money is leaning into this weakness. The stock is pulling back into support with momentum washed out, which is where past rallies have often begun.

Seasonality adds another layer. Over the past decade, buying AXP at the end of March and holding through April has delivered a 100% hit rate, with positive returns in every instance. While no pattern is guaranteed, a track record like that matters when it aligns with flows and technicals. The current setup checks all three boxes: supportive seasonality, fresh dip‑buying under the surface, and a pullback into an established demand zone.

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At the sector level, Financials are firing their own signal. The “Financials Under 50‑Day” indicator has dropped below 10, which historically has marked washed‑out conditions and preceded strong forward returns for XLF. In other words, breadth in the group is stretched to the downside at the same time high‑quality leaders like AXP are seeing stealth accumulation. That combination makes financials one of the more compelling areas to stalk long setups into Q2, with AXP as a preferred way to express the theme.

How I’m Trading It

Can express via 4/17 320C’s or shares

• 1st Target - 306.50

• 2nd Target - 312

• 3rd Target - 327 / 330 Gap Fill

• Support at 297, then 289

Final Thoughts

Wanted to get this one out quick to everyone, hope you enjoy the content and make sure to subscribe as I will be releasing my Q2 2026 Market Outlook this week. Cheers!

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The Big Picture

Q1 2026 has unfolded almost lockstep to my Q1 Market Outlook, outlined in the playbook — energy on top, tech under pressure, and plenty of volatility in between. For anyone who missed the original roadmap, I’ve linked the full report below.

This week I’ll be rolling out my Q2 Market Outlook. It’s worth asking: how were so many of these moves visible months in advance? Markets don’t move randomly — they move in patterns. Seasonality, credit dynamics, and the Presidential Cycle all tend to rhyme. None of them are perfectly reliable in isolation, but when you layer them with technicals, sentiment, positioning, and the broader macro backdrop, a clear picture starts to emerge. That’s where the edge lives — in the overlap.

Last week closed on a cautious note as geopolitical risk around Iran kept traders uneasy. We tagged some key support zones and now the tape has to prove whether buyers can defend them or if this correction still has room to run. Short‑term setups hint at a bounce, but the larger question for Q2 — and the rest of the year — is whether that bounce should be sold into.

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Macro & Data Watch

Continued weakness has sentiment quite negative here heading into the last week of March. Charts below shows data from Goldman highlighting the panic and the overall sentiment read from Subtrade highlighting this has been buying opportunities going back to 2023 (not a large enough sample size IMO)

Economic Calendar - Three Keys This Week

1. Labor & Growth Data Crosscurrents — Tuesday’s ADP report and the S&P Global PMIs set the tone. Another weak hiring print would keep rate‑cut hopes alive, but firm activity data could challenge that narrative and pressure front‑end yields. Watch how markets weigh resilience versus policy easing prospects.

2. Inflation Inputs & Energy Flows — Wednesday’s import/export price data, along with EIA and API inventory updates, will signal whether cooling trade prices and rising crude stockpiles can keep energy‑driven inflation contained. Oil volatility could ripple across both inflation expectations and sector rotation.

3. Sentiment & Fed Messaging — Thursday’s jobless claims and a full lineup of Fed speakers lead into Friday’s final Michigan Sentiment print. Any coordinated hawkish tone or a drop in consumer confidence below 55 would reinforce the “late‑cycle slowdown” narrative heading into Q2 positioning

Earnings Focus: This week’s earnings slate is light but informative. KB Home on Tuesday gives a direct read on single‑family housing demand, pricing power, and cancellation trends in a higher‑rate environment. PDD, CHWY, CTAS, and PAYX mid‑week offer a cross‑section of the consumer and labor cycle, from Chinese e‑commerce to U.S. pet spend and payroll activity. On the macro‑sensitive side, Jefferies will be key for capital markets and credit appetite, while Carnival’s print at the end of the week serves as a real‑time check on discretionary travel and forward booking strength

Stock & Sector Specifics

Last week of March is often a weaker time period, with the week after Triple Witching the Dow has been down 23 of the last 38 instances. However, we are nearing a turning point with Financials showing washed out levels where bounces often follow.

American Express with the same signal, nice setup here in my view

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Single Stock & Dark Pool Alerts

United Health with the top #1 and #2 prints on Friday, also within this wedge, looks like accumulation.

Final Thoughts

Sentiment is getting washed out here, and that can set the stage for a contrarian snapback, but the way the indicators look, it’s not enough on its own to justify loading up on the long side yet. My bias is that a bounce is coming, and it will likely be strong enough to convince a lot of participants that fresh highs are back on deck. I won’t be in that camp; this is still a market for selectively picking the best setups, like the Financials highlighted above, and constantly skewing the probabilities in your favor. The base case remains a choppy, highly volatile year. Keep an eye out for my Q2 2026 Outlook Report dropping this week, where I’ll dig into the bigger picture in much more detail. Cheers.

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Medium to longer term, I still believe this market trades lower, and we already know the playbook for later in the year. In the near term, though, the tape looks primed for a brief but powerful rally. The risk is a tariff‑tantrum style waterfall; the reward is capturing a sharp countertrend move and using those gains to reload for further downside opportunities later on. So, with that framework in mind we have two options, take strategic upside trades while staying cash heavy / hedged or just wait out the volatility into November. If you are reading this, I would think you probably want some action right? Well this might be the best write up of the year for what I think comes next and how to play it, lets dive into it.

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Index’s / Overall Market View

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The Big Picture

We’re right in the middle of classic midterm-year chaos — not just in markets, but across global headlines — all while SPX grinds toward the initial Q1 target around 6500. In an environment like this, impulse control becomes the most valuable asset you have. FOMC week is here, and while that alone usually calls for lighter positioning, the added layer of uncertainty out of Iran reinforces the case for patience and discipline.

My focus this week is on scaling into favorite setups carefully — using shares or leveraged ETFs near downside targets rather than trying to time every bounce or flush. Volatility will come and go; managing your mental game is what truly protects capital. That means having a plan written out ahead of time — the levels you’re buying, trimming, or adding — and sticking to it.

I’ve outlined my framework for Monday through Wednesday based on key indicators and index levels. It’s a reminder to trade with intention, not impulse. I’ve never regretted following my plan, but I have regretted chasing noise. Outperformance, especially in high-volatility environments, doesn’t come from guessing — it comes from clarity, preparation, and execution.

Once you’ve built your plan, you can step into the market chaos with confidence instead of fear. The goal isn’t to avoid the storm — it’s to carve through it with control.

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Index’s

For the majors, the tape remains fragile with downside levels in focus. Acceptance below 659 on SPY opens the door to a quick slide toward the 650 shelf, where heavy trade last appeared back in October. I’m watching for SPY and the QQQ’s to test the 200D on Monday and could setup a bounce.

On the Q’s, the playbook is simple, watch for the 200D to hold.

Macro & Data Watch

Three Keys This Week

• PPI Core MoM at or above 0.5% on Wednesday would confirm January’s heat wasn’t a one-off and likely pushes VIX north of 30 into the Fed decision.

• FOMC - If the dot-plot median drifts higher by even 25 bps, treat it as a regime shift: the Fed is effectively done cutting for now, and broken equity levels flip from “buy the dip” zones to real resistance.

• Jobless claims printing above 220K on Thursday would be the first clean labor crack, flipping the narrative from inflation fear to growth fear and shifting the playbook from “fade the spikes” to “watch for capitulation.”

This week really comes down to whether Powell validates the growth scare or waves it off — everything else is just a setup.

Earnings Focus: Watch towards the middle of the week if you have a combo of Index’s hitting key levels such as SPY 650 (or slight undercut into 640’s) in combination with a negative reaction off a morning earnings report, could be a good bounce setup. For Monday I will be watching DLTR to see if the uptrend could be a trade opportunity if tagged.

Stock & Sector Specifics

Financials continue to show weakness, with heavy outflows driven by rising credit risk and the latest Iran headlines weighing on the major indexes. Several core XLF components like GS, BLK, and AXP now sit in classic mean-reversion territory, with oversold weekly RSI readings and sentiment effectively dead on arrival to start the week. For traders who like to fade extremes, this basket is starting to line up as a potential bounce candidate rather than a fresh short.

Single Stock & Dark Pool Alerts

Speaking of financials, AXP (American Express) has a 100% hit rate over the past 10 years buying the week of 3/15 and holding through April. I love putting the odds in my favor and this is one piece of evidence I’m watching as a trade candidate for the week ahead.

Another piece of evidence I always look at is there any clue in dark pools and clusters of prints that could signal potential buying or selling. AXP checks this box on this as well where we see two recent large prints hit.

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Final Thoughts

This week — and likely the rest of the month — carries real downside risk at almost any moment. There will be sharp rallies, but in a midterm year my focus stays on staying nimble and only pressing the highest‑conviction setups, while reserving most of my long‑term capital deployment for late October into the first week of November, where the historical win rate is as close to 100% as it gets. The priority from here is impulse control and patience: let the setups come to you, then execute with confidence when your levels and signals line up. I’ll be releasing my Q2 Gameplan in the coming weeks so make sure to subscribe, cheers!

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The market is facing another overnight selloff as Iran tensions rise, risk in private equity swells, and the backdrop grows increasingly chaotic with a new Fed chair on the horizon. The key question now is: how do we trade this environment? How do we profit — or at least preserve capital — when the slopes are this unpredictable?

In times like these, I focus on setups that stack the odds in my favor. Maybe it’s a signal like the weekly RSI — when a stock tanks, odds tilt toward a snapback rally. Maybe it’s spotting accumulation in prints and dark pools, or identifying an underpriced catalyst on the verge of ignition. Whatever the approach, the goal is the same: pinpoint which strategies fit your mindset, then go out and execute.

Volatile markets are like skiing on a steep, wind-whipped mountain — thrilling for those who can stay balanced, but punishing for those who lose control. I thrive on that chaos, but one over-aggressive move can send you tumbling fast. Once you’ve found your edge — the setups that consistently work for you — that discipline becomes your anchor. Those same setups should hold up in most conditions, even when the market’s terrain turns wild.

Now, let’s dive in

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Index’s

• If SPY breaks below 670, we could see a retest of the November lows. Over the past two sessions, there have been large clusters appearing in the inverse SPY ETF — a potential signal worth watching for clues of a bottom once those prints return. I highly recommend leveraging VolumeLeaders to spot these developments. It’s not about predicting the market’s next move, but about increasing your awareness of the moving pieces and possible scenarios. That way, you’re not panicking over red futures overnight — you’re simply following a plan grounded in price action

• Should 650’s break, watch for 630’s as next potential target. Keep in mind, closing price is what I often focus on. I see so many get stopped out of trades because support is undercut but then quickly reclaimed, patience is key. Should we rally, need to see a clean break over 680 to target 682, 685. My lean is we bottom sometime between now and FOMC, setting up potential for new highs, but Mid Term years I often keep expectations low.

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Trade Idea’s

• Long Bonds / TLT — I know what you’re thinking: inflation this, inflation that — I get it. And yes, elevated oil prices like we’ve seen lately aren’t ideal for something like TLT. But I try to keep things simple. The new Fed Chair’s short-term mission is clear: lower rates. At the same time, fear across markets is rising, driven by geopolitics and the risk of a potential credit crisis. Layoffs are accelerating — fast. So the question becomes: what represents the true flight to safety, and what stands to benefit from a Fed Chair determined to cut?

  To me, this looks like a mispriced catalyst that also doubles as a hedge if a flight to safety theme takes hold later this year. Recently, several large prints hit VCLT (Corporate Bonds), which tends to track almost perfectly with TLT — and notably, those prints came after the selloff. I like the risk–reward setup here

Final Thoughts

• I’ll have live alerts on the market and trade ideas for paid subscribers, but if you ever have questions about a setup or the market, I’m always happy to share my two cents. My hope is that you find the setups that fit your style this year — the ones that keep you steady when the slope gets unpredictable. And if you’ve already found your edge, it’s time to lean into it and execute with confidence.

  Cheers!

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Blackstone starts in 1985 as a tiny M&A advisory shop launched by Stephen Schwarzman and Pete Peterson with roughly $400k of their own capital and two employees. The backdrop is peak LBO era: cheap-ish credit, a merger‑friendly environment, and a lot of complacent corporate balance sheets.

Very quickly it stops being “just” an advisory boutique and starts morphing into a principal‑investing machine. Schwarzman raises close to a billion dollars for the first private equity fund and leans into classic buyout terrain: under‑managed companies, aggressive use of leverage, and a willingness to be unpopular with incumbents. The early recipe is straightforward but powerful: institutional capital, high‑conviction deals, and a tight grip on downside.​

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Fast forward: by the mid‑2000s, Blackstone controls dozens of companies across sectors, runs sizable PE and real‑estate funds, and is posting >30% annual returns for LPs over multi‑year stretches. The “private” in private equity then gets flipped on its head—the firm itself goes public in 2007 in what was, at the time, the largest PE IPO on record, valued north of $40 billion. That move sets off the arms race: other alt managers copy the model, and Blackstone spends the next decade-plus building out credit, secondaries, infrastructure, and eventually retail‑facing products. As of late 2025, you’re looking at roughly $1–1.3 trillion in AUM, with Schwarzman still in the chair.

“What It Takes” – the Blackstone playbook in book form

If you want to understand how that arc actually felt from the inside, What It Takes is the closest thing to a primary source we’re going to get. It’s easily one of my favorite reads in the “how the sausage really got made” category.

A few themes that line up directly with how Blackstone operates today:

• Go big, or don’t bother. Schwarzman is explicit: his default is to size ambition up, not down. The early fundraise—going from a $400k startup to nearly a billion‑dollar first fund—is treated as the baseline, not an outlier. The book leans into this idea that if a deal or initiative doesn’t move the needle, it’s probably not worth the time.

• Time wounds all deals. One of the recurring lessons is that timing is everything: when you have a good deal, you move; when it stops being good, you don’t sit around hoping it comes back. That urgency shows up over and over in how Blackstone chases dislocations (1991 real estate, post‑GFC distress, Covid) and also how quickly they’ll exit when the risk/reward flips.​

• Load the boat. Schwarzman describes taking Blackstone public partly as a simple capital‑stocking exercise: “load the boat with capital” so the firm can play offense across cycles. More capital, more permanence, more ability to survive and exploit volatility—even if it means inviting public scrutiny and living quarter to quarter in the headlines.​

• Pursue “worthy fantasies.” There’s a whole thread about selling a big vision over and over again—assuming that if someone says no, they just don’t fully understand it yet. That mindset is almost a caricature of the modern alt‑manager pitch: perpetual capital, retail access, evergreen vehicles, and the promise that illiquidity is a feature, not a bug.​

The reason the book hits is that it’s not some sanitized leadership pamphlet; it’s a record of how a particular personality—relentless, risk‑tolerant, hyper‑political—built a structure that could monetize almost any dislocation. If you trade BX or the broader alt space, those mental models matter more than any single quarterly slide.

Private equity’s late‑cycle hangover

Zooming out from Blackstone specifically, private equity as an asset class is dealing with its own version of “time wounds all deals” right now. The 2020–21 vintage was priced on low‑rate, high‑multiple assumptions that don’t exist anymore.

• Liquidity is the pain point. A higher‑for‑longer rate regime means refinancings are more expensive, private credit is pickier, and exit routes are narrower. IPO windows are sporadic, sponsors are less willing to sell at lower multiples, and hold periods are stretching right as LPs want their money back.

• LPs are over‑committed and under‑distributed. After a monster fundraising boom, a big chunk of institutional capital is tied up in commitments that are still being drawn, while distributions have slowed. You see it in surveys: many LPs say they are constrained on new commitments because prior funds haven’t returned enough cash.

• Mark‑to‑model vs mark‑to‑market. Public comps have already reset. Private books, by definition, lag. That gap is where a lot of the medium‑term risk sits—especially in sectors like software and growth equity where multiples got most extreme.

Blackstone’s own stress test was BREIT. When real‑estate sentiment cracked, redemptions surged and the fund had to gate withdrawals, only filling a fraction of requested redemptions for months. The properties didn’t vanish, and long‑term performance may still look fine, but it exposed the core contradiction of the current alt model: daily‑ish liquidity promises on top of assets that really trade on a multi‑year clock.

For investors, that’s the real risk story right now—not that private equity stops working, but that the path to “it worked” winds through a period of very slow liquidity, GP‑friendly terms, and some messy vintage‑by‑vintage dispersion.

BX the stock: where it sits now

On the equity side, BX is basically the listed call option on that entire ecosystem. You’re not buying one fund; you’re buying fee streams, carry, and the firm’s ability to keep raising and deploying capital across cycles.

How I’d think about the setup here:

• Cyclical beta in a fancy wrapper. In practice, BX behaves like a high‑beta financial with a structural growth story attached. When risk assets run, fundraising and realizations pop, and the stock overshoots. When liquidity tightens and exits slow, the multiple compresses and the earnings power gets questioned. You can see it in the way BX outperforms in easing cycles and underperforms when the Fed is in “higher for longer” mode.

• Fundamentals vs macro overhang. Revenue and earnings have rebounded sharply coming out of the 2022–23 slump, but you still have a macro overhang in the form of slower distributions, tougher financing, and a more cautious LP base. That tension is essentially what you’re trading.

• Valuation vs regime risk. A mid‑20s forward multiple for a capital‑light, fee‑rich compounder isn’t wild, but it assumes the PE engine keeps spinning and that the industry works through the liquidity crunch without major damage. Any real accident in private credit, real estate, or a sharp drop in fundraising would hit both the “E” and the “multiple” at the same time.

If you strip the story down to levels and narrative, BX here feels like a classic late‑cycle exposure: you’re getting paid a respectable yield to own a structurally advantaged platform, but you’re underwriting a fair amount of macro and liquidity risk to collect it.

In other words, the stock is the embodiment of the book’s title. You get the upside of what it takes to build the world’s dominant alt manager—size, brand, relationships, and a proven playbook for buying when others panic. You also inherit what it takes to sit through the part of the cycle where time starts wounding deals, LPs get impatient, and the market decides whether an illiquidity premium is still a feature…or a bug.

The Sector and The Trade

Below I’ll list a group of companies in the PE space and my base thesis on each and how I would trade them.

Stepstone - a smaller hidden gem in the sector, from low 20’s in 2022 it then proceeded to rise nearly 300%. Now reaching a similar washout level on Weekly RSI, I think this may be an opportunity. The risk is a similar move to 2022 where RSI bottomed but then the stock chopped lower into early 2023 (People forget early 2023 where everyone, myself included, was convinced another leg lower was coming in equities). I like scaling into the name in October and 1st week of November once overall market weakness should end based off Mid Term seasonals.

KKR - similar idea but lots of recent call volume, combined with this key 85 level dating back to 2023, think this could be a strong mean reversion trade. The 200D would be my target near 126.

Blackstone - disclaimer, I bought shares today but fully expect it to be a choppy ride and potential for more lows sometime this year is strong, but with the weekly RSI washed out and pedigree of the company, I like it here. There is risk down to the 90 and 70’s levels but that would be an ideal spot, not the expectation it gets that low. For now I like it to play it for a bounce.

Final Thoughts

Private Equity isn’t dead, but some companies will die. Choose wisely if entering this market, but similar to the recent software trade, sentiment is incredibly washed out in this sector along with technicals, this may be an opportunity.

Hope you all enjoyed the content, I shared my trade idea’s each week for paid subscribers and a weekly write up of the overall market for all free subs as well. A sub and share goes a long way, so thanks for reading and reach out anytime for future write up ideas. Cheers!

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Macro vs Technicals

Going to keep this short, basically world is ending on the Macro front and technicals are breaking down. Does that mean now is the time to short? No, I always want to be positioned ahead of the move, which we are in this case, just not directionally short. Instead, we have been able to avoid getting chopped up and now can deploy cash into the best setups. Now lets dive in!

I shared this chart several times over the past few weeks, this type of price action should be expected. The key is what comes next.

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The Big Picture

March opened with even more drama layered on top of an already choppy tape. We kicked off the week with U.S.–Israel strikes on Iran and the assassination of much of Tehran’s leadership, which produced the expected war‑shock open: oil and metals spiked, travel and cyclicals gapped lower, futures traded heavy, and then—dip‑buyers stepped in and pushed the indices back toward flat by the close. Mid‑week saw more headline‑driven chop as markets tried to price a conflict that clearly won’t be a two‑day event.

That’s not exactly an easy backdrop—war headlines, rising yields, and rolling sector landmines are classic mid‑term‑year ingredients—but despite the noise our performance was one of the best weeks of the year, we stayed focused on positioning into the panic rather than trading every wiggle, leaned into our best oversold themes, and finished the week solidly ahead of the indices.

• Early Weakness: Writing this weeks paper later so we can take a look at the Futures open, deep red across the board.

  

• Key Watchouts: Looks like we are closing in on my Q1 target of 6500’s, with current technical readings could be a great spot to buy the dip. My lean is that we bottom sometime this week but remember the tariff tantrum of last year, I have been pounding the table for a more defensive stance. Now as chaos around the world unfolds having cash ready and hedges serve as great ways to maximize the next opportunities. Our recent performance shows you can be defensive and out perform the market at the same time.

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Macro & Data Watch

• Iran + Fed Speakers : We enter the week in the Fed Blackout period and news out of the middle east likely will be the focus each day versus any data releases.

• CPI + GDP: I’ll be watching CPI, GDP, and JOLTS this week and prep for FOMC the following week.

• Jobs: The latest jobs report was the most underrated story to me from last week. Headline unemployment is still just 4.4%, but nonfarm payrolls fell by 92,000 in February, with prior months revised lower as well. Under the surface, Charlie Bilello’s work puts a finer point on it: over the last six months the U.S. has averaged a net loss of roughly 1,000 jobs per month, and this is only the 12th time since 1950 we’ve seen this much weakness in the labor market—on the prior 11 occasions the economy was already in recession

• Would you take this bet? I don’t trust the data or Washington to admit a recession so I wouldn’t, but, wouldn’t shock me based on the data.

Earnings Focus: With all the weakness in the index’s it can create some good buying opportunities, ORCL will be a key focus and potential target as sentiment and technicals are washed out.

Each week I share my favorite trade idea’s with paid subscribers, can take advantage of 15% off the annual sub through March.

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Stock & Sector Specifics

Financials starting to create fear

• Imagine the financial sector opens near the 100W, the next move will be key to watch.

• I’ll be watching for a flush on the SFFI (Financials Above 50D) as a buy signal

  

  Single Stock & Dark Pool Alerts

  • Yes, I am going to discuss MSFT again. We have trade several call options and MSFL of late but this trade hit last week and might be an opportunity should be the market open deep red. I don’t follow trades but I do like to put odds more in my favor.

    

Final Thoughts

It’s a short paper this week but it should be pretty straight forward week ahead, weakness has arrived, now how do we take advantage of it? Too late to chase puts longer term if you aren’t hedged as one tweet from Trump could rally markets. My lean is to continue being defensive and follow the SPY levels laid out below. As indicators start to show washed out levels, that is the time to strike. Until then, defense is the approach.

I hope you all enjoyed the content, i’ll be releasing my playbook and Trade Idea’s for Q2 in March for paid subscribers, so be on the lookout. A restack or share is always appreciated, cheers!

Remember, don’t focus too much on the now, but on the “what comes next”

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Hunting for Asymmetric Upside in Oversold China

China tech is back in a spot that tends to matter: , flashing the same signals that have preceded sharp mean‑reversion rallies in the past.

The KWEB chart I’m working off via says it clearly. Often when the 14‑day RSI has broken below 20, forward returns have been strong. We’ve just tagged that same sub‑20 RSI zone again, with price back near support and sentiment signaling recent capitulation from bulls.

This isn’t about suddenly loving the China macro. It’s about the setup: deeply oversold momentum, crowded bearish positioning, and a historical pattern that has repeatedly rewarded leaning the other way on a short‑term basis.

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What stands out in the current tape

• Several decent size prints have came in over the past two sessions

• The different trade vehicles I often target are all showing oversold RSI readings here, doesn’t guarantee a bounce but adds to the thesis of a trade setup

• This latest oversold print is landing against a backdrop of negative headlines, and active traders effectively taking eye’s off the China play, which is exactly the sentiment profile that tends to precede snap‑back moves while they chase crowded sectors

Why BABA is the primary vehicle

Alibaba is still the flagship of the China market. It’s the most liquid, the most widely followed, and the default way global investors express China exposure.

That makes it the first place I look when KWEB’s RSI throws this kind of signal. If China squeezes, BABA is one of the names most likely to move first and farthest. For this specific oversold episode, the focus is on short‑term upside in BABA into the March 20 window, using upside calls itself as the cleanest expression 3/20 140C’s at 3.20 a contract currently. Take profit level’s are 139, 145 (Retest of 200D), and 151. My own plan is to take profit early and often.

Last week’s trade idea’s have created a lot of happy subscribers, goal is this BABA setup plays out as well.

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BABX: focused leverage on the same thesis

BABX is essentially 2x daily Alibaba in ETF form. When BABA moves, BABX should magnify that move on a short time scale.

The thesis doesn’t change between BABA and BABX—it’s the same bet on KWEB’s oversold condition unwinding via a BABA‑led squeeze. BABX just concentrates the exposure: more torque per dollar of capital versus pure BABA shares.

In this framework BABA is the core, and BABX is the levered overlay for the same view.

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YINN, BIDU, JD: where they fit

The rest of the China complex sits a bit further down the list for this particular signal.

• YINN offers 3x daily exposure to a broad China large‑cap index, so it captures more than internet—financials, SOEs, telecoms, and other cyclicals.

• BIDU brings the search and AI angle. It usually trades in sympathy with BABA but doesn’t command the same flows

• JD is the value ecommerce leg—cheap on traditional metrics, with a decent balance sheet, but a repeat value trap at various points in the China downcycle and less tightly coupled to the “China tech bounce” story than BABA.

For an RSI‑driven setup, the goal is to align as closely as possible with the part of the market the signal is coming from. That keeps BABA—and by extension BABX—at the top of the list, with YINN, BIDU, and JD as contextual or secondary expressions rather than the main focus.

The setup I like here

Putting it all together:

• KWEB is registering a rare sub‑20 RSI print that has historically led to strong 2–4 week rallies.

• Within that backdrop, BABA offers the cleanest vehicle, and BABX provides targeted leverage on the same thesis, lining up well with a short‑term upside window into March 20.

That’s the pocket of China exposure where the technical, sentiment, and historical studies all line up in a way that makes the current oversold reading worth paying attention to.

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Macro vs Technicals

Been seeing some Volatility seasonal charts signaling risk off in March going around, but when you filter down to Mid Term years you start to see a very different picture. Notice the top at beginning of March just so happens to line up with this well telegraphed Iran news over the weekend?

I think there is a strong case to be made for the market to hold up in March and then Q2-Q3 we start to see some more risk in these markets. For now, I think the trade setups are here to take advantage of any weakness on Monday. However, there is one unique boom+boost pattern I have found, lets dive in.

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Last week will be hard to top, congrats to the team for executing.

Trade Setup’s

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