🚨 Watch Before Monday 9 30am! The Stock Market is About to Go Crazy

The Nasdaq and S&P 500 rallied, but the broader market has been in a range since October 2025. Many mega-cap stocks are in corrections, with significant drops in Microsoft, Netflix, Meta, and Amazon. The VIX trading at 18 indicates a volatile market, despite indices appearing to consolidate. This raises the question of whether Friday's bounce was a relief rally or a local bottom.

Despite the stagnant indices, the S&P equal weight and Dow Jones have made new all-time highs, largely driven by non-tech stocks and consumer staples. The market is highly concentrated in the seven largest stocks. Technically, the S&P 500 bounced off its 100-day moving average, and a new all-time high is possible in the short term. The speaker advises caution and selectivity in stock picking due to market dislocation, but is not bearish or shorting the market yet as nothing appears 'broken' structurally on the weekly charts.

The market's current tight range hasn't been seen since 1965, which preceded a bear market in 1966. However, the market is still in an 'AI bubble' bull phase. Tech stocks, particularly the XLK, were beaten up but could stage a rally, potentially leading to a 'blowoff top,' as 31% of Nasdaq stocks are oversold. Historically, midterm election years tend to see corrections later in the year, supporting a potential short-term bounce followed by a correction around March-April.

The speaker advises a stock-picker market due to dislocations. He mentions picking up Microsoft and Broadcom (which had a monster 7% day), and holding Google, Pepsi, and Costco. He believes Novo Nordisk (NVO) will recover and Netflix is a good value. AMD is considered a potential short if it re-enters a specific gap. The software sector (IGV) is highlighted as being heavily beaten down (down 31% from highs) but shows signs of being oversold on the weekly chart, suggesting a potential 'violent bounce' despite AI's impact on some of these stocks.

The market displays conflicting signals, with some stocks at new highs and others at new lows, reminiscent of 2000. Citing three 'Hindenburg omens' in one month, the speaker re-emphasizes caution without being overly bearish. He is raising cash and plans to hedge. Upcoming key economic data includes retail sales, non-farm employment change, unemployment claims, and CPI on Friday. The employment data is particularly interesting with layoffs reaching 2009 levels. The expected S&P 500 range for the week is 120 points, which could lead to a new all-time high.