A crucial reversal in Tuesday's session. The two previous sessions — Friday the 15th, with a massive gap down, and Monday the 18th — had woken the bears from hibernation. But surprisingly, the market found something solid to hold onto and clawed its way out of a deep hole, roughly 45 minutes into the trading session. From there it was show time, with the S&P, Nasdaq and Dow pointing the way back to the den for a pack of bears hungry for open air. Not even a dreadful Michigan Consumer Sentiment reading managed to shake the stoicism of a market determined to hold its ground in bull territory.

A Wildcard That Only Gets More Valuable With Time
Geopolitics continues to prove itself a genuine wildcard, with the upside of peace in the Middle East feeding a thesis of a ceiling on inflation and, by extension, on reference rates. This caught me somewhat off guard, as the inflation ghost had gained considerable strength at the end of the previous week. That said, I'm increasingly convinced that the longer this drags on, the greater the pressure from heavily affected parties to get ships moving through the Strait of Hormuz again. We saw evidence of that during the week, with interventions from players with a great deal to lose from this conflict.

Semis Put On The Gloves
On Tuesday, it was the semiconductors — again — that laced up the gloves, slipped the punch, and landed a clean uppercut. They closed Tuesday in the green, and that served as a launchpad for the rest of the week, reaching rarefied air again by Friday's close. My focus remains on semiconductor leadership, in a week where results from the sector's undisputed leader, NVDA, neither surprised nor compromised. That gives the market room to consolidate or continue the climb — even when the leader isn't the one picking up the tab, while still holding its place at the front of the peloton.

One For The Price Of Four
The shortened week ahead brings renewed hopes around the Hormuz wildcard, but also some caution around Thursday's economic data — a set of indicators tied to the health of the US economy. I'm particularly focused on Core PCE, GDP and Personal Income. It may be wishful thinking, but I keep asking myself whether — and when — the data will start to reflect the weakening of purchasing power and broader credit deterioration.

Reviravolta crucial na sessão de terça-feira. As duas sessões anteriores — sexta-feira dia 15, com um gap down tremendo, e segunda-feira dia 18 — tinham acordado os bears da sua hibernação. Mas surpreendentemente, o mercado agarrou-se a algo de bem sólido para sair literalmente de um belo buraco, corridos cerca de 45 minutos da sessão de trading. Daí para a frente foi show time, com os três principais índices — S&P, Nasdaq e Dow — a indicar o caminho de regresso à toca de uns bears sedentos de ar livre. Nem mesmo um Michigan Consumer Sentiment para lá de horrendo mexeu na impassibilidade de um mercado que se agarra ao que pode para se manter em território bull.

Um Wildcard Quanto Mais "Velho", Mais Valioso
A geopolítica continua a mostrar-se como um verdadeiro wildcard, com o upside de paz no Médio Oriente a alimentar uma tese de ceiling na inflação e nas taxas de referência. Isto acabou por me surpreender, pois o fantasma da inflação tinha ganho força considerável no final da semana anterior. No entanto, tenho convicção de que quanto mais tempo passa, maiores serão as pressões de vários players para que os barcos voltem a passar no cada vez mais famoso Estreito de Ormuz. Tivemos prova disso durante a semana, com a pressão de partes altamente prejudicadas por este conflito.

As Luvas dos Semis
Na terça-feira, quem calçou as luvas — com uma esquiva digna de cinema — e soltou um belo upper cut foram mais uma vez os semicondutores. Fecharam a sessão de terça no verde, e isso serviu de catapulta para o resto da semana, com os semis a ir buscar máximos históricos na sessão de sexta-feira dia 22. O meu foco continua numa liderança de semicondutores, numa semana em que o seu líder incontestável, a NVDA, não surpreendeu nem comprometeu. Isso dá margem ao mercado para continuar a trepar mesmo quando o líder não assume as despesas da subida — sem no entanto descolar da frente do pelotão.

One For The Price Of Four
A semana em formato reduzido que começa traz redobradas esperanças do wildcard de Ormuz, mas também bastantes cautelas com os dados económicos de quinta-feira — uma bateria de indicadores ligados à saúde da economia americana. Estou principalmente interessado no Core PCE, no GDP e no personal income. Pode ser um pouco de wishful thinking, mas continuo a perguntar-me quando — ou se — vamos chegar a ver dados preocupantes ligados ao enfraquecimento do poder de compra e à deterioração do crédito em geral.

A week that may have marked an inflection point — not necessarily in the upward trajectory since the post-Liberation Day rebound, but above all in the near-vertical climb of the indices most associated with growth: the S&P and the Nasdaq.

Structural risk vs. geopolitical noise.
Having now witnessed two sessions — Tuesday and Friday — of sharper reactions to the threat of a higher-for-longer rate environment, driven by not only stickier but also higher-than-expected inflation data, what's interesting is that the market may have found here a far more structural reason to make a u-turn than anything related to the US-Iran conflict. With geopolitical risk, wishful thinking comes easily. With inflation risk, it doesn't — the ghost doesn't necessarily go back into the closet because of a few tweets.

What the tape said.
The "good feeling" that Tuesday's price action gave us — a solid rebound off the session lows — didn't replicate on Friday. There was a recovery attempt mid-session, but the close simply didn't hold, and didn't try to. Sectors that had climbed almost vertically, semiconductors chief among them, were among the most penalised in both sessions.

What to watch next week.
Next week should give us valuable clues about whether sentiment can hold — or will yield — to the shadow called inflation. Wednesday, the world's most valuable company reports earnings. The fanfare around this quarterly event isn't what it used to be, but the current momentum around semiconductors could make it a catalyst, particularly if the over-deliver trend that peers have shown in recent weeks continues. Elsewhere on the calendar: initial jobless claims and housing starts on Thursday, and the University of Michigan consumer sentiment to close the week — notable but not decisive, in my view.

Back-to-back gap ups across the major indices for the second week running. This reveals the strength of the current tide — and it came with a slightly narrower range than the previous week in the S&P and Nasdaq, and a much more significant volatility compression in the Russell. VIX dropped below 16 on Thursday, a level not seen in four months. This more structural tailwind was accompanied by a 9% weekly drop in WTI and a cooling of the 10-year rate. In the tweetosphere, winds change rapidly — but I'm of the opinion that the 60-day truce will hold. For now.

Resiliency Test Passed
Other than Thursday — where the truce deal propelled the market into a single-direction lane — the other three sessions showed a solid capacity to absorb selling pressure in the first quarter of each session. On three separate occasions, the shock absorbers worked well and the bulls took it to the finish line. This is what someone who is long wants to see: pressure absorption and resilience. But it doesn't end there — you also want good catalysts to materialise in the tape.

Follow The Upgrades
And that is exactly what happened this week. Analyst calls on two major semiconductor names injected strong doses of euphoria — as if you really need any in this sector these days. Micron surged 20% on Tuesday, courtesy of a UBS price target upgrade, and ARM benefitted from a Mizuho upgrade on Thursday. If that wasn't enough, the AI-adjacent play delivered astonishing fireworks on Friday, with Dell skyrocketing more than 32% after reporting a very strong quarter driven by AI server demand.

Tired Legs
Among all the resilience, upgrades and rosy outlooks, I noticed some fatigue in the Philadelphia Semiconductor Index on Friday — it simply didn't have the legs to participate in the broad daily bounce seen across the indices. Worth keeping an eye on. That said, the SOX still finished the week up over 5%, essentially repeating the previous week's feat.

More Popcorn
Big week ahead for semis, with Broadcom reporting on Wednesday. Economic data every day except Thursday — I'll be focused on Job Openings on Tuesday, and Unemployment and Payrolls to close out the week.

Last week we asked for more popcorn. It looks like it got delivered in containers — they ran out of buckets.

After all that recent effort to climb to the peak, we could not enjoy the views from up high for very long. A very busy week where economic data and corporate earnings made it to the horror movies category, delivered in style in back-to-back episodes. Broadcom's AI coating got peeled off by unforgiving investors, and Friday's employment data blew a gigantic hole in the market. One thing is for sure: investors' memory tends to be much less effective than the DRAM in all our tech devices.

Learned a New Word (and New Dynamics)
Taipei was the genesis of a very solid semi performance in the first two sessions of the week, which spread to different corners of the tech universe. On Monday, at an annual conference named COMPUTEX — yes, this is the new word — Jensen Huang announced NVIDIA's foray into the AI in-house segment, with new ammunition. On Tuesday, the same actor propelled Marvell to a staggering 32% daily pop — what I coined a vertigo candle.

ARM was up on increased royalties from incremental NVIDIA sales in the PC market segment. And it was very interesting to watch the opposite reaction from AMD, Intel and Qualcomm — big competitors and legacy players in this space.

Stairs Up, Elevator Down
Price action from the majors proved resilient in the first half of the week, trying to dismiss increased geopolitical uncertainty and hotter ISM reads — services and manufacturing alike. But after Broadcom's earnings, the tech space started to question whether the rarified air they had all been climbing through was actually breathable — and it turns out, arguably, it was not.

Good News Are Bad (Horrible) News. Again.
I was encouraged to see the Nasdaq and the S&P fight back a pretty adversarial tape on Thursday, anchored mainly in Broadcom indigestion. But Friday brought the ghost back from the closet like it had never been hiding. A Black Friday to remember for a while — Nasdaq 100 down 4.8%.

Market Memory Will Be Tested
A new batch of inflation numbers this coming Wednesday is where I will spend all my popcorn. Bears might already be salivating over a possible — likely? — further heating of prices, which could prove catastrophic to sustain after this unreal two-month run. Hard to call it an inflection point when the economy keeps churning jobs. But investors sitting on comfortable profit cushions will have little hesitation to press the red key.

Position Update
I exited my position in SOXL on Thursday after the market close.

Despite being very impressed by the way the Nasdaq fought back a pretty damaging post-Broadcom opening, what made me exit was not only the way the Nasdaq and the S&P threw in their towels at the end of the session — but that fatigue started to show immediately in the first minutes of after hours.

Knowing now the avalanche that came down the day after my exit — SOXL dropped 30% — I feel very fortunate to spend this weekend gaining a fresh market perspective.

↗ Rule — Wait for the end of the session.

In a highly volatile week, what stood out to me was how the geopolitical wild card kept swinging up and down, dragging market sentiment along with it. A relatively benign CPI print later in the week provided some much-needed relief. Not the SpaceX IPO.

These were the backbone of an unexpected leadership role by the least sexy of the majors — the Russell, which closed the week at all-time highs.

From a price action perspective, I was surprised by Thursday's strong opening following Oracle's gloomy moment the previous day. Maybe something was already in the air — because by mid-session the TACO trade was served hot and tasty, and that changed the tone of what had been a very difficult week until then.

To prove that the Wall Street theme park is still open, the VIX travelled from 23 to 17 during the week. Despite early geopolitical pressure, WTI's downward slide continued, dragging yields below 4.5%.

The Messiah and The Clearance
Jensen the Messiah Huang spoke and the market listened. I was surprised by how the week started with a strong rebound from a nasty Black Friday, almost without a hiccup throughout the session. Semis stayed at the front by a mile, ending the day up more than 6% — a clear sign there were deals investors did not want to miss.

The Pump Fake and The Second Semis Flush
On Tuesday, the Red Sea struck again. After a promising first twenty minutes that looked ready to confirm Monday's buy-the-dip parade, the market suffered another meaningful flush — one that even undercut the Black Friday lows from just two sessions earlier, with SOX once again pointing the way downhill. What impressed me was how the market absorbed that flush and still finished in the upper half of a large daily red candle, suggesting bears would not be taking a second major victory lap within the span of just three sessions.

Pump Fake Strike Two and The Floor
A somewhat mixed CPI print got the mid-week session off to yet another strong start, especially for the Russell, but the engine sputtered once more as selling pressure returned and pushed prices back toward the Black Friday lows. I saw a market trying to find a floor. However, renewed geopolitical pressure and, to be honest, a sticky inflation backdrop were both pointing to what I like to call structural nervousness overall. I am observing more intraday selling pressure and not many places to hide.

The Week Ahead From The Deck
Above all else, two variables: the Hormuz deal — its shape, its outcome and, more importantly, the market's interpretation of it — and the season premiere of "Is Kevin Warsh a Hawk or a Dove?"

I do not have much popcorn left from last week, but I am almost guaranteed to finish this one scraping the bottom of the bucket. Hopefully I will not be doing the same with my beloved leveraged ETFs. Mr. Wall Street once taught me that the legend of buying the exact bottom tick is precisely that — a legend.