Overall market trend: Bearish phase – day 16
Yesterdays market: Money leaving the market – Normal selling pressure
TC2000 McClellan: -58
Stocks above 40PMA T2108: 19
VIX: 16
52 week highs (US common stocks): 174
Seasonality: The historical case: October is the midterm year’s best month
Since 1950, October has been the best-performing month in U.S. midterm years, averaging a 3% gain for the S&P 500 and posting positive returns 73.7% of the time. November ranks second, averaging a 2.7% gain, with positive returns 78.9% of the time. The midterm effect is large. Across all years, October has been positive nearly 60% of the time since 1950, with an average gain of 0.89%, so the midterm version roughly triples the typical October return. LPL also notes that the improvement from October onwards in midterm years has not depended on which party holds the Presidency.
The key difference from the template.
The midterm Q4 rally has historically started from a deep autumn low, which you’ve already noted. Since 1950, the S&P 500 has suffered an average peak-to-trough decline of about 18% in midterm years. In 2026, the S&P 500 fell 5% in the first quarter, rallied 15% in the second, and gained 2% in the third, and it remains less than 2% below its last record close. The early-year weakness fits the pattern. But there hasn’t been an autumn flush, so the “relief rally off the lows” mechanism has less to work with. Detrick’s comment that the historical Q4 pattern should not be viewed in isolation applies here, especially with yields at 5.3% and oil above $100.
Overall, the seasonal tailwind for October 2026 is real but should be discounted. The usual setup (a washed-out market heading into the vote) is missing. The more likely route to a large Q4 might be a further pullback in October, followed by the post-election rally, rather than a straight run higher from here.
Indices:
$SOXX Uptrend
$QQQ: Uptrend
$SPY: No trend
$RSP: Downtrend
$DIA: Downtrend
$IWM: Downtrend
$BTC: Uptrend
$SQQQ: Downtrend
$UVIX: No trend
$TLT: Downtrend
$USO: Downtrend
$GLD: Downtrend
$SLV: Downtrend
$SLX: Downtrend
2%+ sectors yesterday:
- None
2%- sectors yesterday:
- $IBB -2.17%
Main sectors monthly trailing:
- Leading – $IBB $XLK
- Lagging – $XLF $XLB
Sub sectors monthly trailing:
- Leading – $SMH $HACK
- Lagging – $TAN $IYT
Bitcoin: 86k ish
Themes:
Cybersecurity
Infrastructure
Cloud Computing
Semiconductors
Software
Clean energy
Crypto
THEME 1: Agentic AI CPU & Compute Squeeze:
| Ticker | Company Name | Sector/Industry | Market Cap | YTD Return | Key Catalyst | Analyst Consensus |
|---|---|---|---|---|---|---|
| INTC | Intel Corporation | Semis – CPUs/Foundry | ~$620B | ~+220% | Server CPU shortage; reported 10% CPU price hikes; +17% this week | Hold; ~$115 |
| AMD | Advanced Micro Devices, Inc. | Semis – CPUs/GPUs | ~$1.0T | ~+185% | 10% price hike from Q4; crossed $1T market cap; EPYC share gains | Strong Buy; ~$617 |
| ARM | Arm Holdings plc (ADR) | Semis – CPU IP / AGI CPU | ~$320B | ~+170% | >$2B AGI CPU customer commitments FY27–28; server royalties doubling | Moderate Buy; ~$306 |
| QCOM | QUALCOMM Incorporated | Semis – CPUs/Data Center | n/v | n/v | Amazon AI data-center deal; +9% on the Muse CPU trade | n/v |
| NVDA | NVIDIA Corporation | Semis – GPUs/Grace CPUs | ~$5.5T | ~+21% | More agents means more compute; SOX +7% since Muse | n/v |
| TSM | Taiwan Semiconductor Mfg. Co. Ltd. (ADR) | Semis – Foundry | ~$2.2T | ~+40% | Wafer price increases flowing through to chip prices; fabs for every CPU designer | n/v |
| AVGO | Broadcom Inc. | Semis – Custom Silicon/Networking | n/v | n/v | Hyperscaler custom chips; recent price-target raises | n/v |
| MU | Micron Technology, Inc. | Semis – Memory (DRAM/NAND) | ~$1.2T | ~+280% | FQ4 earnings Sep 30; Citi models DRAM prices +20% q/q | Buy; Citi PT $1,300 |
| SNDK | Sandisk Corporation | Semis – NAND/Enterprise SSD | ~$260B | ~+650% | Rosenblatt initiates at Buy; SSD demand from AI inference | Buy; Rosenblatt PT $2,400 |
| DELL | Dell Technologies Inc. | Hardware – AI Servers | ~$380B | ~+345% | Demand for CPU-dense servers; +5% Friday | n/v |
| SMCI | Super Micro Computer, Inc. | Hardware – AI Servers | n/v | n/v | Rack-scale server demand | n/v |
| HPE | Hewlett Packard Enterprise Co. | Hardware – Servers | n/v | n/v | Enterprise server refresh | n/v |
| MRVL | Marvell Technology, Inc. | Semis – Custom Silicon/Optics | n/v | n/v | Custom CPU/accelerator programs | n/v |
| AMKR | Amkor Technology, Inc. | Semis – Advanced Packaging | n/v | n/v | Packaging is a limit on AGI CPU supply | n/v |
| LRCX | Lam Research Corporation | Semicap Equipment | n/v | n/v | SEMICON West; chip equipment shortages flagged by Citi | n/v |
| SOXX | iShares Semiconductor ETF | ETF | – | n/v | Broad semis basket | – |
| SMH | VanEck Semiconductor ETF | ETF | – | n/v | Mega-cap semis weighted | – |
| PSI | Invesco Semiconductors ETF | ETF | – | n/v | Equal-weight-style semis | – |
| SOXL | Direxion Daily Semiconductor Bull 3X | ETF (3x leveraged) | – | n/v | Tactical/leveraged | – |
THEME 2: Agentic AI Platforms & Agent-Commerce Winners:
| Ticker | Company Name | Sector/Industry | Market Cap | YTD Return | Key Catalyst | Analyst Consensus |
|---|---|---|---|---|---|---|
| META | Meta Platforms, Inc. | Comm Services – Interactive Media | ~$1.9T | ~+14% | Muse is the #1 app; Truist sees ~$28.5B in revenue by 2030 | Buy; recent PTs $750–$860 |
| MSFT | Microsoft Corporation | Software – Cloud/Copilot | ~$3.8T | ~+7% | Stifel upgrade; Copilot at ~30M seats | Buy; Stifel PT $575 |
| SHOP | Shopify Inc. | Software – E-commerce/Payments | ~$185B | ~−10% | Muse checkout via Shop Pay; Stifel sees a Q4–2027 boost | Buy; ~$173 |
| GOOGL | Alphabet Inc. (Class A) | Comm Services – Search/Cloud | ~$4.2T | ~+10% | Gemini agents; Googlebook launch | n/v |
| AMZN | Amazon.com, Inc. | Consumer Disc./Cloud (AWS) | ~$2.7T | ~+8% | AWS benefits, but Amazon blocked Muse on its store (mixed) | n/v |
| ORCL | Oracle Corporation | Software – Cloud Infrastructure | ~$390B | ~−30% | Trending; cloud capacity for agents; laggard that could rebound | n/v |
| TWLO | Twilio Inc. | Software – Communications APIs | n/v | n/v | Morgan Stanley: agents increase messaging volumes | n/v |
| NET | Cloudflare, Inc. | Software – Edge/Security | n/v | n/v | Managing and securing agent web traffic | n/v |
| PLTR | Palantir Technologies Inc. | Software – AI Platforms | n/v | n/v | AIP enterprise agents | n/v |
| NOW | ServiceNow, Inc. | Software – Workflow | n/v | n/v | Enterprise agent workflows | n/v |
| CRM | Salesforce, Inc. | Software – CRM | n/v | n/v | Agentforce adoption | n/v |
| SNOW | Snowflake Inc. | Software – Data Cloud | n/v | n/v | Data layer that agents query | n/v |
| DDOG | Datadog, Inc. | Software – Observability | n/v | n/v | Monitoring of AI agents | n/v |
| OKTA | Okta, Inc. | Software – Identity | n/v | n/v | Agent identity and authorisation | n/v |
| LYV | Live Nation Entertainment, Inc. | Entertainment – Ticketing | n/v | n/v | Ticketmaster is a Muse launch partner | n/v |
| MAGS | Roundhill Magnificent Seven ETF | ETF | – | ~+10% | Mega-cap AI platforms | – |
| XLC | Communication Services Select Sector SPDR | ETF | – | n/v | META/GOOGL heavy | – |
| IGV | iShares Expanded Tech-Software ETF | ETF | – | n/v | Software rebound | – |
| AIQ | Global X Artificial Intelligence & Technology ETF | ETF | – | n/v | Broad AI | – |
What type of market are we in: Choppy
Are breakouts working: No
Are breakouts likely to work for the next 3 – 5 days: No
Are breakdowns likely to work for the next 3 – 5 days: Selectively
Should I be trading: Small increase in positive breadth readings yesterday and some tech names trying to go while megacap tech had a generally weak day, looking like a green open yesterday was a day 1 in some names, see if we get any follow through or just more chop.
Todays watchlist (stocks setting up): Symbols from TC2000
$AMKR
$PLTR
$TQQQ
$SOXL
$AMZN
$IONQ
$DRAM
$RGTI
$FCEL
$MRVL
$META
