Summary: The market remains broadly risk-on, led by strong technology and semiconductor performance, positive QQQ volume trends, low volatility, supportive risk gauges, and strength in growth and emerging markets. However, weak breadth beneath the surface remains a concern, with deteriorating market internals, weak participation in SPY, DIA and IWM, fewer stocks holding key moving averages, and sharply rising rates creating an increasingly important counterweight to the strength in large-cap technology.

Risk On

• Major U.S. indexes were mostly up with QQQ leading the way, up over +3.2% for the week. Russells were down on the week. (+)
• Volume patterns were strong in QQQ with 4 accumulation days to 1 distribution day. (+)
• Technology is one of the hottest parts of the market this week. (+)
• Risk gauges remain strongly risk-on. (+)
• Volatility continues to trade around its lows for the year. (+)
• Growth remains in a bull phase led by semiconductors. (+)
• Foreign equities, led by emerging markets, still looks relatively strong. Though more established foreign equities have dipped below its 50-Day Moving Average. This is mirroring some of the market action in the U.S. (+)
• Bitcoin had another weekend pop above its recent range. September and October tend to be strong seasonal periods for Bitcoin. (+)
• Seasonal trends tend to strengthen in the end of September into October (except when there is a market crash), however most sectors are beneath their one and six month calendar ranges as are the DIA and IWM (+)

Neutral

• Sectors skewed negative again this week, with notable exceptions in healthcare and technology which are really strong.. (=)
• The modern family is mixed, with Semiconductors and Biotech showing good relative strength, while Retail, Transportation, and IWM have continued to trend lower. They are now oversold on Real Motion and could be subject to mean reversion. (=)
• Soft commodities pulled back off their highs, though momentum remains intact. Copper is consolidating at high levels. (=)
• Gold could be signalling a blow-off top if it fails from these current levels. (=)

Risk Off

• Volume patterns are very weak in DIA, IWM and SPY, showing very few accumulation days.. (-)
• Market internals remain on their recent lows with little improvement. However, the cumulative advance-decline line continues to deteriorate. (-)
• New high new low ratio continues to be weak, sitting around its lowest  levels for the year. (-)
• The color charts (moving average of stocks above key moving averages) are showing weakness across the board with even the 200-Day relationships weakening. The Nasdaq is showing some early signs of flattening out. (-)
• Rates hit new 20-year highs with a sharp move lower in bonds this week. Speed of move is concerning. (-)

Actionable Trading Plan

Maintain a risk-on bias, but stay selective and avoid chasing broad-market strength given the continued deterioration in breadth. Favor leadership areas—particularly technology, semiconductors, select healthcare, and stronger emerging markets—while keeping position sizes disciplined and using pullbacks or consolidations as preferred entry points.

Continue to underweight or avoid weaker areas such as small caps, retail, and transportation until they demonstrate improving momentum and participation; oversold conditions could produce tactical mean-reversion trades, but they have not yet established durable leadership. Closely monitor market internals, new highs versus new lows, and the percentage of stocks above key moving averages—improvement would support increasing exposure, while further deterioration alongside weakness in QQQ would be a signal to reduce risk.

Keep stops tighter than normal given the sharp rise in rates and weak volume patterns outside the Nasdaq. Take partial profits into extended moves, particularly in technology and other momentum leaders, and watch gold for a potential failed breakout while allowing commodity positions with intact momentum room to consolidate.

Bottom line: Stay invested with a growth and technology bias, but don't confuse strong index performance with broad market health. Add exposure if breadth begins confirming the Nasdaq's strength; reduce exposure and raise cash if technology leadership breaks while breadth and market internals continue deteriorating.