[Chart courtesy of MarketWatch.com]
- Moving the market
Today’s rally had two clear drivers: stronger-than-expected earnings and a sudden drop in geopolitical anxiety.
Traders cheered upbeat results from companies like Palantir and Caterpillar, while comments suggesting progress in U.S.-Iran talks helped send oil prices lower, easing one of the market’s biggest recent concerns.
The result?
Stocks took off and never really looked back. The Dow closed at another record high, the Nasdaq posted its best day in more than a year, and the mega-cap growth names kept flexing their muscles.
Amazon crossed the $3 trillion mark, Nvidia reclaimed the $5 trillion club, and the Magnificent Seven added another impressive chapter to an already remarkable run.
What’s especially interesting is how resilient this market has been. With more than 84% of S&P 500 companies beating earnings expectations, investors seem willing to focus on profits rather than problems.
Add in falling bond yields, a weaker dollar, strength in gold and Bitcoin, and even a healthy dose of short-covering, and you had a near-perfect recipe for a risk-on day.
The bulls are certainly enjoying themselves right now, but after a four-day sprint that’s left the bears looking for the emergency exit, the question is: does this rally still have fuel in the tank, or is the market getting a little ahead of itself?
2. Current domestic “Buy” Cycle (effective 5/20/2025); International “Buy” Cycle (effective 5/8/25)
Our domestic bullish cycle that began on November 21, 2023, concluded on April 3, 2025, following a market downturn triggered by President Trump’s tariff policy announcement.
This development caused significant declines across major indexes and broader market indices. However, markets subsequently rebounded, culminating in a new domestic “Buy” signal taking effect May 20, 2025.
Concurrently, our International Trend Tracking Index (TTI) experienced parallel volatility. On April 4, 2025, it breached critical thresholds, prompting a “Sell” recommendation. This position reversed as global markets recovered, with the International TTI regaining sufficient momentum to issue a new “Buy” signal effective May 8, 2025.
3. Trend Tracking Indexes (TTIs)
Good earnings news and a cooling of the rhetoric out of the Middle East gave traders plenty of reasons to put cash to work right out of the gate.
The bulls grabbed the steering wheel at the opening bell and never looked back, cruising higher all session without so much as a pit stop.
It wasn’t just a narrow rally either. The broad market joined the party, metals participated, and our TTIs took off alongside the major indexes.
Days like this remind me that when fear takes a coffee break, buyers tend to get a lot more ambitious.
This is how we closed 08/04/2026:
Domestic TTI: +10.42% above its M/A (prior close +8.86%)—Buy signal effective 5/20/25.
International TTI: +8.60% above its M/A (prior close +7.40%)—Buy signal effective 5/8/25.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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