Top Pick Performance
Cash was our only official top pick on this Morning Note. Short IWM was our only official top pick of the Morning Show and it paid well as IWM collapsed to close to our $289 target before rebounding at the end of the day. Long USO was also a top focus in our community and it also paid well as it was up 3% on the day.
*This newsletter does not constitute investment advice. Past performance is not indicative of future results. StoryTrading contributors may buy, sell, or liquidate positions discussed at any time without notice. See storytrading.com/disclaimer for important disclosures. Our exclusive Discord Edition is delivered to Discord members before 7:00 AM ET every trading day.
Macro Discussion
The bottom in AI infrastructure stocks may be in.
Both Micron and the semiconductor index bounced off the 50 DMA yesterday as money rotated out of IWM on Iran and oil concerns and back into this beaten-up sector.
While the situation in Iran continues to escalate, a reversal on bad news is often a strong sign of a bottom. We believe that’s what we’re seeing in QQQ and AI infrastructure stocks this morning, further catalyzed by good news from META NVDA and SK Hynix (see catalyst section for details).
As a result, while it’s very possible that names like NBIS AAOI MRVL AEHR GLW and NVDA have bottomed, that doesn’t mean it will be smooth sailing from here. Volatility and sharp sector rotations remain a feature of this market, making day-trading a difficult endeavor.
Meanwhile, although the market is shrugging off developments in Iran, we believe the pain is likely not over for the rate-sensitive IWM.
We’re upgrading to a green signal almost entirely because of the successful 50 DMA bounce in Micron and the SOX but that doesn’t mean it’s safe to chase this morning’s gap higher.
Rather, it’s simply time to become more optimistic on everyone’s favorite sector of 2026 and patiently wait for the right setups identified through our four-pillar methodology
Today’s Signal: 🟢
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