In the week, Wall Street only wanted one thing…signs from the Federal Reserve that a recession was farther away than assumed. The soft-landing scenario means lowering rates in a way that usually sparks the market higher.

If the Fed waits too long and begins to cut rates during a recession, it will not be good news for stocks.

Interestingly, the Street will ignore signs of a recession if the Fed plays along.

Giddy Up

All eleven sectors surged, and the great news is that non-magnificent seven Tech (XLK) stocks led the charge.

Heat Map & Breadth

Like the Hope Diamond of market sessions, this is as nearly perfect as the market can get.

Climbing Out the Mini-Abyss

Market breadth saw overwhelming bullishness in advancers over decliners and up volume to down volume. The fact there were more new lows than highs underscores how badly the market was hit.

Market Breadth	NYSE	NASDAQ
Advancers	2,265	3,079
Decliners	560	1,120
New Highs	35	51
New Lows	48	195
Up Volume	3.4 billion	4.43 billion
Down Volume	580.51 million	1.33 billion

Large-cap growth led the charge, and for all the handwringing over its dominance for the sake of the rest of the market, there can be no blockbuster sessions without large-cap growth pacing the parade.

It was the best session for the NASDAQ-100 (NDX) since February 2, 2023, and the best for the NASDAQ Composite since November 2022. The chart looks so compelling, with the Relative Strength Index (RSI), Rate of Change (ROC), and Money Inflow Index (MFI) reversing.

Today’s Session

Despite the strong close, the market is looking to open lower, and investors are rightfully on edge.  Fed jawboning works but nowhere like it once did. There has been a fair amount of lost credibility starting from the top.

Until the S&P 500 closes above its 50-day moving average, look for lots of fits and false starts.

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