RowRow

JUST IN: Anthropic says they’re highly profitable if you take out some of their biggest expenses.

I always hesitate to tell people I'm a trader when asked what I do for work. I've never had any bad experiences from telling people but for some reason I always mentally pause before I answer. Curious if anyone else experiences the same thing?

@RowRowTrades had a great day yesterday. I'm proud of that young man! @TeamTapeX

Pre-market analysis, Thursday 9th July, 2026 1. Market Summary Yesterday was a very important expectation breaker. The market was hit with renewed Iran escalation, an oil spike and hawkish FOMC minutes, yet $SPY only flushed into the 740 area, tagged the 50 day region, reclaimed the 21 and 8 day moving averages, and closed at 745.40. That is not panic. That is absorption. The issue is that the tape is not fully clean either. $QQQ closed green, semis caught a clear bid, but $IWM was down 0.91% and breadth weakened. So this remains a rotational tape rather than broad risk-on. My bias today: constructive but conditional. Above the SPX 7,495 to 7,500 zone, the path opens back towards 7,525, 7,550 and potentially 7,600 into OPEX. Below that zone, especially if 7,447 and then 7,400 fail, the tape becomes a much more reactive negative-gamma chop zone. The market has absorbed the headline, but today must prove it can reclaim structure. 2. Macro analysis The macro backdrop is still headline-heavy but the market is not pricing panic. Brent slipped back below $77 after the prior surge, US 10 year yields around 4.56%, and Trump saying he did not expect a full-scale war. That matters because the equity tape is treating Iran risk as a volatility spike to fade unless energy supply risk genuinely worsens. Oil remains the key macro swing factor. Brent was around $77.86 and WTI around $73.37 after fresh US strikes on Iran, with markets still weighing risks around Hormuz shipping and possible de-escalation. If crude holds below the recent spike zone, equities can grind. If crude rips again and yields follow, the inflation shock comes back into play fast. The FOMC minutes were hawkish enough, not because the Fed is desperate to hike immediately, but because inflation concern is still live and some officials remain open to further tightening. The Fed kept rates at 3.50% to 3.75% in June, but the minutes showed growing concern around persistent inflation and a committee still divided on the path ahead. China is not a drag this morning. China services PMI eased only slightly to 54.1 from 54.4, still expansionary, and overseas demand rose at the fastest pace in 20 months. More importantly for the equity tape, reports around potential limited Nvidia AI chip access into China are supportive for the AI and semi sentiment channel. Japan remains relevant through yields, energy import pressure and the yen. Recent data showed Japanese factory activity still expanding, with Japan PMI rising to 54.8 from 54.5, helped by Asian factory resilience and AI demand. That supports the global tech manufacturing cycle, but yen weakness remains a watchpoint if oil moves higher. Europe is mixed but not breaking. Germany’s May industrial output rose 0.9%, well ahead of the 0.2% forecast, while ECB commentary still frames the eurozone outlook as fragile with energy-price risks and weak demand coexisting. That is not a major US equity headwind, but it reinforces the same global theme: better growth data, but energy inflation risk still has to be respected. 3. Momentum and breadth Breadth is the biggest warning in the tape. The index held up, but participation did not. Nasdaq stocks above the 5 day average fell to 34.42 and S&P tech stocks above the 5 day average sat at 41.89. Russell breadth is still better on a medium-term basis, with 50 day and 200 day breadth holding above 60, but yesterday’s Russell weakness shows cyclicals and small caps are not confirming the semi bounce yet. While SPX looked calm, decliners outnumbered advancers by roughly 3.5 to 1, with semiconductor strength masking weakness in travel, materials, cyclicals and broader market breadth. The next test is whether semis can retain structure and print a higher low and whether volatility decreases. 4. Volatility This remains the bull case. $VIX spiked near 19 intraday yesterday but closed back at 16.90, and this morning is around 17.13. $VVIX is 91.38, elevated but not screaming stress. $VIX1D is back near 12.68, and the front of the curve is still not behaving like a genuine crisis tape. The $VX2/$VX1 ratio around 1.045 confirms the market is still in a mild contango and low-vol regime. That is important. If geopolitical risk was being repriced as persistent, we would expect front vol to hold much firmer. Instead, spikes are being faded. Front-end fixed strike vol woke up on the spot downtick, downside skew caught a bid, but upside remained offered, with any VIX move above 20 viewed as likely short-lived. Note that COR1M is at a multi-year low which fits the earnings-season dynamic where index vol can stay contained even with single-name dispersion. The gamma picture has been a little messy in the past few sessions but 7,495 to 7,500 is essentially gamma the regime gate. Above it, dealer stabilisation and vol compression return. Below it, moves can amplify and the 7,400 zone becomes vulnerable. 5. Credit and liquidity Credit is not confirming panic. HYG/TLT continues to recover strongly, $HYG itself is stable, KRE remains bid, and LQD/HYG is not giving a classic stress signal. That tells me this is still more rotation and hedge adjustment than systemic de-risking. SOFR-IORB is around -0.03, so funding is calm. There is no liquidity warning there. The 2s10s move needs watching because oil plus hawkish Fed minutes can create a bear-steepening impulse, but credit is currently saying the equity tape can absorb it. This is why I am not chasing bearish index exposure here unless spot loses key levels. When volatility is contained, funding is calm, credit is holding and gamma magnets sit overhead, shorts need immediate follow-through. Without that, they get squeezed. 6. ETF and Sector rotation The RS dashboard is very clear: yesterday’s green in tech and semis was a bounce inside lagging RS, not yet a confirmed leadership reset. Top 5 by RS: $XBI, $IBB, $XPH, $HACK, $KIE. Bottom 5 by RS: $QQQ, $SOXL, $XSD, $PAVE, $NLR. High RS pockets are still concentrated in biotech, healthcare, cybersecurity and selected financials. XBI, IBB and XPH all remain leadership names with strong MA confluence. HACK and KIE also remain leadership pockets. $XLV is still a leader and has clean MA structure, but I would be careful chasing it late after the defensive rotation. Defensives are mixed. $XLP has strong MA confluence but only mid-pack RS. $XLU is better on RS but lacks the clean trend stack. $XLRE remains weak. That tells me the defensive bid is no longer broad enough to be the main trade unless the index breaks lower. Growth and cyclicals are where the important battle is. $SMH was up 1.99% and $SOXX up 1.87%, but both remain laggards and both lack MA confluence. $XLK was up 1.24%, but also remains a laggard. That does not mean avoid them. It means this is an early mean reversion setup, not yet a fully confirmed leadership handoff. Energy is a tactical geopolitical trade, not a clean trend leadership trade. Key watch: SMH and XLK need to reclaim MA structure and hold higher lows which I think they will given the action in semis yesterday, especially $NVDA and $AVGO. XLV needs to avoid rolling over after defensive overperformance. QQQ needs to prove yesterday was an oversold reversal, not a one-day semi bounce. 7. Summary The tape absorbed exactly what it needed to absorb yesterday: Iran escalation, an oil spike, hawkish FOMC minutes and semiconductor stress. That is bullish behaviour, but not a clean risk-on signal yet because breadth deteriorated and gamma is sitting right on the regime boundary. My trade plan is straightforward. If SPX reclaims 7,495 to 7,500 and VIX fails to hold above 17 to 18, I favour upside continuation towards 7,525, 7,550 and then 7,600 into OPEX. In that scenario I want growth, semis and selected former leaders, especially after a morning shakeout rather than chasing the opening gap. If SPX rejects 7,500 and loses 7,450, then the constructive grind thesis pauses and the tape can trade down to 7,400 quickly. If SPY loses 740 and then the 50 day region near 737, I would stop treating dips as automatic buys.

The best answer was from @RowRowTrades. Most people saw the obvious part: software and semis are rotating. That was not really the point. The more useful signal is the timing of the rotation. IGV/SMH correlation often breaks hardest around the US open. That is where the opening flows, rebalancing, hedging adjustments and relative-value churn are most aggressive. But the edge is not blindly buying whichever group leads first. The edge is asking: Does the opening divergence persist, or does it start to mean-revert once the correlation line stabilises? That is where RowRow was closest. His read was basically: Negative correlation early → watch for the relationship to normalise later → possible long laggard / short leader convergence trade. That is the right direction of thought. QQQ then becomes the filter. If QQQ sits between IGV and SMH, you may have genuine intra-tech rotation. If all three move together, it is probably just Nasdaq beta. If the leader keeps extending after 10:30–11:00, respect the leader. If the leader stalls and correlation begins to recover, do not chase the morning winner. The better trade may be the laggard catch-up. Special mention to @beach2030 and @Sneha6222535844 too: both were close on the “correlation flattening / advantage stalling” point. But RowRow got closest to the tradeable read. DM me on Telegram to arrange your 20-minute 1:1 session.