All major indices continued their momentum this week, with each pushing to new all-time highs (ATHs). The S&P 500 continued marching higher throughout the week, officially breaking into new ATH territory on Tuesday and continuing through that level to close the week firmly above prior highs.
The Nasdaq (QQQ) continued to outperform, gapping into ATHs on Tuesday and showing similar continuation throughout the week, finishing well above previous highs.
We also saw solid participation from small and mid caps. Following a deeper pullback in prior weeks, these areas staged an impressive rally back into all-time highs. Similar to the other indices, a new ATH was made on Tuesday, however momentum stalled slightly afterwards, with price trading mostly sideways for the remainder of the week while successfully holding those breakout levels.
Themes in Play
IGV – Strong momentum late in the week pushed price back above all key moving averages, clearly defining a new uptrend. This rally still appears relatively early, with solid upside potential remaining. Looking for a pullback or momentum pause for potential entries.
SMH – Strong continuation into ATHs this week following a successful pullback to the 21-day moving average. Price was able to hold breakout levels into the close, keeping continuation on the table. One point of caution: given how extended this theme has become, combined with signs of potential rotation into other sectors, I would tread carefully as the group may be due for a stress test.
CLOU – Solid breakout on Friday pushed price back to equal 52-week highs. Similar to IGV, this sector still feels like it has meaningful upside potential. Watching for a pause in momentum to look for entries.
HACK – Continued strength following a brief momentum pause. Currently short-term extended, but still worth monitoring closely.
UFO – Strong gap into ATHs at the start of the week, with price successfully holding those levels throughout. Friday’s price action showed continued buyer interest, keeping the door open for further continuation.
Conclusion
This week showed strong continuation across all major indices, supported by improving breadth and broader participation across multiple sectors. While the primary leadership themes remain intact, we are also beginning to see signs of potential rotation into broader areas of tech, which could create fresh opportunities if momentum continues to expand beyond the usual leaders.
At this stage, the market remains firmly in an “all systems go” environment. In conditions like this, the focus becomes less about predicting tops and more about managing risk, staying aligned with leadership, and patiently waiting for high-quality setups rather than forcing entries into extended names.
This week, my main focus will be:
- Tracking pullbacks in broader tech/software sectors (e.g. software, cyber security, cloud)
- Watching for continuation opportunities in UFO and SMH-related names