Week 25: The Rally Is There, But Remains Narrow

Market Regime

The Week 25 picture confirms a market still in risk-on mode, but with an internal structure less convincing than the headline indices suggest. The risk indicator remains in expansionary territory, around the 68 mark, yet breadth does not point to genuinely broad-based participation.

The figure that cannot be overlooked is the composition of the rally: roughly 60% of stocks remain above their 200-period moving average and 54% above their 50-period average. Positive numbers, but not enough to declare the market fully healthy.

Intermarket: equities and dollar in strength

The intermarket reading presents a constructive but not perfectly harmonious picture. Equities and the dollar remain firm, while bonds and commodities move in a more neutral fashion. The signal is consistent with a positive market, but not with a full cross-asset expansion.

Leadership and rotations

Leadership remains concentrated in technology and semiconductors. The US market continues to benefit from the large-cap growth names, while the equal-weight reading signals weaker participation relative to the cap-weighted index.

In Europe the week was more fragile, with the DAX and FTSE 100 pulling back. Asia, by contrast, offers more interesting signals: South Korea, Taiwan and India stand out as areas to monitor for relative strength and positive rotation.

US sectors: the market is not broad-based

The sector message is clear: technology and semiconductors continue to lead the market. The SOX remains one of the primary drivers of the current phase, while energy and certain cyclical areas show greater weakness.

The dichotomy between SPY and RSP remains central. SPY benefits from the weighting of the large technology names; the equal-weight reading tells a less "exuberant" story. This does not invalidate the rally, but it does diminish its quality.

Domina TradingSuite as market intelligence

The entire recap originates from the market intelligence of Domina TradingSuite. The platform is not used merely as a charting tool, but as an integrated infrastructure for reading regime, rotations, breadth, flows and price structure.

During the session, several features of the new Domina 2.0 were demonstrated: instrument information cards, Point & Figure, Market Profile, Volume Profile, automated Wyckoff tool, and dark pool and lit pool analysis. The value lies not in any single screen, but in the structured combination of informational layers.

S&P 500: demand zones, volume and Wyckoff reading

On the S&P 500, focus was placed on a significant demand area, supported by the Volume Profile reading and the positioning of the POC. The zone around 5,663 was identified as a technical area to watch should prices return to that level.

The most interesting aspect is not the level itself, but the process: demand area, gap, possible induction low and price reaction. This is a reading consistent with a Wyckoff-oriented approach, where context carries more weight than any single signal.

Focus: Micron, dark pool flows and earnings

One of the most noteworthy moments of the webinar concerned Micron Technology. Evidence from dark pool flows heightened market attention ahead of earnings, with a rank-1 transaction of extremely significant size alongside further institutional activity during the month.

This is not an automatic trading signal. It is information to be integrated with the semiconductor sector context, price action, earnings risk and the rates environment. The point is methodological: institutional flows can add a useful informational layer, but they do not replace the analytical process.

The macro risk: the Fed and US rates

The macro backdrop remains dominated by an increasingly data-dependent Fed and a US yield curve that warrants close monitoring. The rise in yields, particularly at maturities most sensitive to monetary policy expectations, directly impacts the discount rate applied to future earnings.

This is especially significant for capital-intensive companies and high-duration growth sectors. The market may continue to advance, but the margin for error narrows when the rally is concentrated and the cost of capital starts rising again.

Closing remarks

The market remains positive, but selective. The rally is real, yet it is not sufficiently broad to speak of fully homogeneous strength. In this context, selectivity remains the guiding principle.

The operational conclusion is straightforward: follow the leadership, but avoid mistaking the strength of a few sectors for the overall health of the market. Technology and semiconductors remain centre stage; breadth, rates and institutional flows are the three indicators to watch closely in the days ahead.