Summary: Markets staged a broad-based risk-on rally with strong gains, improving breadth, leadership from semiconductors and growth, and multiple indicators (internals, volume, risk gauges, global equities, and Bitcoin) flipping bullish—though momentum still faces resistance at declining intermediate trends.

However, conditions are now stretched to near-term overbought levels with volatility compressing and macro inputs (rates, commodities, gold) largely neutral, suggesting the rally may need consolidation before sustaining higher.

Risk On

• Markets put in a strong week, up 3-4.5% on the week with three of the four closing back in bull phases. One concern is that momentum just got back up to its declining 50-Day Moving Average on real motion and remains in a bear phase. (+)
• Sectors were nearly positive across the board, with the exception of IBB which was flat, and every, which came off its highest levels. Semiconductors were up over 11% and consumer discretionary also had a strong week. It was the worst week for oil prices in six years. (+)
• Volume patterns clearly favored risk-on with all indexes having more accumulation days than distribution days. (+)
• Speculative sectors like semiconductors and related countries were the best performers this week. (+)
• The 52-week new high new low ratio had a major reversal and flipped positive with a positive stack and slope. (+)
• The color charts (moving average of stocks above key moving averages) on a short-term basis across all the indexes are flipping to positive bull mode readings with improving long-term readings. (+)
• Risk gauges have flipped fully positive. (+)
• The value vs growth relationship is showing growth is regaining some short-term leadership and improving its phase, while value returned to a bull phase. (+)
• The modern family was strong this week with 5 of the six members up on the week and SMH, KRE, and IWM reclaiming a bullish phase. Semiconductors hit a new all-time high. (+)
• Foreign equities resumed leadership and both emerging and developed markets are in bull phases. (+)
• Bitcoin showed some strength, clearing its 50-Day Moving Average for the first time in several months. (+)
• Seasonal trends are good heading into April for the S&P and Nasdaq, though still weaker for Small Caps. (+)

Neutral

• Market internals surged to overbought levels this week from oversold levels two weeks ago. This could be an overall positive momentum thrust. The NASDAQ is a bit more extreme than the S&P. (=)
• The color charts (moving average of stocks above key moving averages) on a short-term basis across all the indexes have or are flipping to positive bull mode readings. (+)
• Volatility backed off considerably from its peak on March 27th. The Cash Vix is back into a warning phase and testing support. (=)
• Soft commodities eased a bit this week, however, we did get a cross of the 50-Day Moving Average over the 200-Day Moving Average. DBA is lagging the SPY on a short-term basis. (=)
• Gold was up marginally on the week while oil came off its highest levels. (=)
• Rates remained stable this week. (=) 

Actionable Trading Plan

Bias: Lean Risk-On, but tactically managed (not fully committed yet)

• Increase equity exposure incrementally rather than all at once, prioritizing leadership areas (semiconductors, growth, discretionary, and strong foreign markets).
• Avoid laggards (biotech, soft commodities) unless they show clear relative strength improvement.

Execution Framework

• Buy strength on continuation, not weakness—focus on names/sectors holding gains after the sharp rally rather than chasing extended moves.
• Scale in over multiple entries to reduce risk of buying into a short-term overbought condition.
• Favor relative strength leaders making new highs or reclaiming bull phases (SMH-type leadership, IWM/KRE confirmation, Bitcoin above key trend).

Risk Management / Positioning

• Keep position sizes moderate given overbought internals and resistance at declining intermediate momentum.
• Maintain a cash buffer (20–40%) to stay flexible if the rally stalls or reverses.
• If leadership sectors begin to fail broadly (not just pull back), reduce exposure quickly rather than waiting for confirmation.

What to Watch (Decision Triggers)

• Follow-through vs. stall:
• Continued expansion in new highs and strong sector breadth → add exposure.
• Loss of momentum + failed breakouts → shift back toward neutral.
• Leadership health:
• If semis/growth continue leading → stay risk-on.
• If rotation shifts defensively → tighten risk.
• Volatility behavior:
• Stable/declining volatility → supports adding risk.
• Sharp volatility spike → move to defense quickly.

Bottom Line

Participate in the upside, but treat this as an early-stage regime shift with overbought risk—build exposure selectively, stay focused on leaders, and be quick to de-risk if momentum fails.