Risk On

• SPY and QQQ closed under their 50-day MAs during the week, but rallied to recover to a bull phase. All 4 market ETF are in bull phases with positively sloped 50-day MAs 
• QQQ bounced off support and mean reversion levels defined by the Real Motion 200-day MA. 
• Sector performance highlights how Friday, the week’s best day was led by Semiconductors (SMH), Biotech (IBB) and Technology (XLK) and Gold Miners (GDX)while Consumer Staples were down on the week 
• New high/low data shows S&P held up its longer term trend during the recent pullback and the moving averages of the ratios have not crossed
• The Color Charts are bullish across all time frames in S&P and IWM. Nasdaq is mixed but on balance still positive
• Growth (VUG) closed on the high of the week and back over its 50-day
• Value (VTV) hit a new high on Thursday and remains in a strong bull phase
• All the members of the Modern Family all are in bull phases. 
• Seasonally Transports and Retail are bearish in December but this year they are both up. 
• Market Internals and specifically the McClellan Oscillator turned bullish for both the SPY and the QQQ’s by Friday's close 

Neutral 

• Volume patterns are neutral
• Oil looks oversold and at a technical level that it can bounce from
• The yield curve is steepening but both long and short-term rates are in a range
• Short term yields rose sharply in reaction to Japan raising rates
• Foreign equities in Europe’s developed markets followed a similar pattern to the US, while Emerging markets in Asia remain mostly weaker in a warning phase. 

Risk Off

• Bitcoin (BTC) which has been been highly correlated with declines in the Risk On for stocks is consolidating  
• Nasdaq100 saw the number of new 52-week lows swell and the moving averages of the new 52 new high/low ratio cross down. 

1. Summary

Maintain a measured risk-on stance. The market remains in bull phases across all major indexes, with recent pullbacks resolving through rotation rather than broad breakdowns. Strength in leadership groups, resilience in the S&P versus Nasdaq weakness, and bullish longer-term breadth measures support staying invested while emphasizing relative strength. Seasonal tailwinds have not asserted themselves, reinforcing the case to remain positioned but selective.

2. Index Positioning

• SPY: Maintain core long exposure while price holds above the 50-day MA following the recovery.
  
• QQQ: Maintain exposure after bouncing off Real Motion 200-day MA support; monitor closely as Nasdaq breadth has been weaker than the S&P.
  
• IWM: Maintain or slightly overweight given bullish Color Charts across all time frames.
  
• DIA: Maintain core exposure consistent with broad bull-phase conditions.
  

3. Sector & Leadership Allocation

Lean into rotation rather than broad beta.

Overweight / Favor

• Gold Miners (GDX) — leadership on both daily and weekly time frames.
  
• Health Care (XLV) — weekly leadership and defensive growth characteristics.
  
• Consumer Discretionary (XLY) — strong weekly performance despite bearish seasonal tendencies.
  
• Semiconductors (SMH), Biotech (IBB), Technology (XLK) — short-term leadership, particularly evident on Friday’s upside expansion.
  

Maintain

• Value (VTV) — new highs and strong bull phase justify continued core exposure.
  
• Growth (VUG) — reclaimed the 50-day and closed on the weekly high, supporting balanced exposure.
  

4. Rotation & Breadth Interpretation

The divergence between S&P stability and Nasdaq weakness in new 52-week lows confirms an internal rotation, not broad risk-off behavior. The bullish Color Charts in S&P and IWM reinforce this view and support staying invested while favoring leadership groups.

5. Modern Family Framework

All members of the Modern Family are in bull phases, supporting continued equity exposure. However, leadership is selective, reinforcing the need to allocate toward relative strength rather than equal-weight exposure.

6. Rates, Bonds, and Macro Signals

• Yield curve steepening warrants monitoring, but with both short- and long-term rates still range-bound, no aggressive rate-based positioning is warranted.
  
• Weakness in short-term rates following Japan’s rate hike suggests remaining cautious with duration exposure.
  
• Oil is at a potential technical bounce level; monitor for confirmation before acting.
  

7. Global Markets

• Developed markets: Maintain exposure as they are tracking the U.S. pattern.
  
• Emerging markets: Remain underweight while they stay in a warning phase.
  

8. Risk Monitoring

Bitcoin (BTC) consolidation bears watching due to its historical correlation with risk-on equities during declines. A downside resolution would be an early warning signal, not yet a trigger.