This week’s edge: last week’s AI and semiconductor leadership broke down hard, with Nvidia falling into Breakdown, Broadcom and Alphabet losing their trend, and the AI-compute names down double digits, while money rotated into healthcare, defensives, and select value as Treasury yields fell. Respect the regime change: trim or avoid the broken growth leaders, do not chase the falling AI-compute names, and lean into the healthcare and defensive names that are actually holding and reclaiming their trends.
Market Conditions
This week the tape did a sharp about-face. The recovery that had broadened into AI and semiconductor leadership a week ago reversed, and the reversal hit the leaders hardest: the Nasdaq-100 fell 4.6% on the week to 706.52 and lost its Trend-Hold, while the S&P 500 gave back 2.4% to 728.99 and also slipped into Transitional, even as the Dow edged higher and small caps actually rose, the Russell up about 1.4%, the mirror image of last week’s growth-over-value rotation and a tell that this was a megacap-growth unwind, not broad liquidation.
The damage was concentrated in the names that led the prior bounce: Nvidia fell 9% into Breakdown, Broadcom dropped 11% into Repair, and Alphabet lost 9% and its trend, while the AI-compute complex was crushed, CoreWeave down 18% and Nebius down 16%, Oracle down 19% into Breakdown on a weak reaction, and Palantir down 12%. Even the foundry and equipment names that kept their structure took losses, Taiwan Semi down 6% and ASML down 7%, holding Trend-Hold only by the grace of how far they had run.
The other side of the ledger was a clean defensive and healthcare rotation: Eli Lilly rose 10% and held its Trend-Hold, UnitedHealth added 7%, Novo Nordisk jumped 11% out of Breakdown, and the defensive-retail and defense names firmed, Target up 7%, Dollar General up 5%, RTX reclaiming Trend-Hold, with Palo Alto Networks up 6% one of the few software names gaining ground.
The macro backdrop confirmed the risk-off tone: Treasury yields fell, the 2-year easing to 4.07% from about 4.19% and the 10-year to 4.38% from 4.46% as money sought safety, while volatility ticked up and the VIX-tracking products rose on the week. Credit stayed orderly, high-yield spreads roughly steady, so this reads as a growth scare and a leadership rotation rather than a systemic stress event.
The regime count tells the story plainly: Trend-Hold names fell from 25 to 17 while Breakdowns rose to 26, leadership has thinned, and until the broken growth leaders reclaim their trends the burden of proof sits on them, not on the tape.
What Changed From Last Week
Reclaimed Trend-Hold: FFIV, RTX. The strongest signal of the week, structure fully repaired.
Lifted out of Breakdown into Transitional: NVO, PINS, SHOP. Early bounces that still need to prove themselves.
First repair off the lows: LULU. Damaged names showing the first sign of basing.
Cooled out of Trend-Hold into Transitional: AIXA.DE, IFX.DE, NBIS, QQQ, SPY, XOVR. Leaders that lost their trend and now need to re-prove it.
Lost the trend, into Repair: AVGO, COPX, GOOG. Downgraded a full step, treat as damaged until reclaimed.
Broke down: AMZN, ASTS, CRWV, NKE, NVDA, ORCL, RDW. Fresh damage, the framework moves these to the avoid list.
Biggest movers: NVO +11%, LLY +10%, TGT +7%, SHOP +7% to the upside; RDW -24%, ORCL -19%, CRWV -18%, NBIS -16% to the downside.
How Our Trade Plans Work
Our framework is rules-based and level-driven. We classify each name into a regime (Trend-Hold, Transitional, Repair, or Breakdown) using the 1D EMA stack, cross-checked against the 1W chart. Every entry, target, and invalidation traces back to a specific indicator level. T1 is the first profit-take layer, T2 is the structural objective, T3 is the stretch target on full continuation. Sizing follows the regime: Trend-Hold names take normal size but only on a pullback to support or a confirmed breakout; Transitional names take half size or wait; Repair names take a starter only after a reclaim; Breakdown names are avoided until a reclaim confirms.
Two stops, two jobs. The trade stop protects the position; the regime invalidation changes the thesis. The trade stop is the tactical level where a single trade is wrong and you cut it. The regime invalidation is the deeper level where the entire classification flips to a lower regime and the reason to own the name is gone. They differ on purpose: one manages risk, the other manages conviction.
Cash is a position, and waiting is part of the plan. This update ranks 60 stocks and ETFs: the highest-conviction, near-entry names get a full setup, and the rest are tracked in the watchlist table so nothing in the universe goes uncovered.
This Week’s Playbook
Start here. The detailed setups follow for the top names, and the full watchlist table covers the rest.
Best risk/reward this week: TSM, ASML, ITA, FFIV, SMSN.L, RBRK (+1 more in the table). Price is already at a defined entry on the 1D EMA20, so the trigger is near and the risk is tight; these are the names that reclaimed or held their trend, the cleanest longs to engage as leadership rotates.
Best leaders to buy only on weakness: UNH, AMAT, INTC, LRCX, TGT. Clean trends with room to run, but buy the pullback, do not pay up here.
Most dangerous chase setups: none this week. After a broad selloff nothing is overbought, which is itself a measure of how much momentum was unwound.
Avoid until a reclaim confirms: ADBE, AMZN, ASTS, BABA, BIDU, COST, CRWV, ETHA, GLD, INTU, LMT, META, MSFT, NFLX, NKE, NOC, NVDA, ORCL, PALL, PLTR, RDW, SLV, WMT, XOM, XRH0.L, XRPI. No long exposure; not every dip is a setup, and cash is the position.
This update covers the following 60 stocks and ETFs across consumer, technology, healthcare, industrials, and commodities.
Top 5 Actionable Setups
The highest-conviction names sitting closest to a defined entry, with full detail, levels, and both stops for each. The next tier follows in the Also Actionable table, and the rest of the universe in the full watchlist below it.
Taiwan Semiconductor Manufacturing Co. (TSM), Last close: 432.35
Setup: The foundry that anchors the entire AI supply chain, Taiwan Semi held its Trend-Hold through a 6% pullback while the AI-accelerator names broke, the most resilient structure in the chip complex. Full Trend-Hold on both the daily and weekly, the cleanest structure in the framework, with first support at the 1D EMA20 (432.04). Daily RSI 51.7 (neutral-positive), MACD bearish accelerating; the trend is intact but uncommitted, favor a defined pullback. Thesis breaks on a daily close below 345.64 (20.1% below current), shifting regime to Transitional.
