Life Changes. Markets Didn't.

RLT Newsletter 3/2/2026

It’s been a week since my last newsletter due to the unexpected (and joyful) arrival of our third son. He’s currently in the NICU getting the care he needs before joining the rest of the family at home. While my world has shifted dramatically over the past week, the markets... not so much.

The slow, grinding sideways action persists across the major indices: SPY, QQQ, IWM, and DIA. Among them, QQQ stands out as the obvious laggard, still trading below its 100-day SMA—a clear sign of the relative weakness in tech right now. You can see this weakness vividly in the charts of the Trillion-Dollar Titans.

SPY Daily Chart

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The headline event last week was NVDA’s earnings release. Bulls were hoping for a decisive win that would silence doubters and reaffirm AI as the unstoppable future rather than a bubble. NVDA delivered yet another blowout: record revenue of $68.1 billion (up 73% YoY) and strong guidance. But in this market environment, even stellar earnings aren’t enough to spark sustained buying. We’ve seen this pattern repeatedly in 2026—strong results followed by market punishment. It’s a classic sign of exhaustion near highs, which is why I’ve stayed cautious as these patterns unfold.

On Wednesday (pre-earnings), NVDA gapped out of its three-month range and pushed higher, printing the highest bullish volume of the year so far. That candle offered a clean day-trade setup, but swinging into earnings was far too risky. Post-report, the stock spiked for about 20 minutes before failing hard—opening lower the next day and dropping nearly 10%, approaching the 200-day SMA. Despite the volatility, NVDA remains trapped in the same multi-month range it’s occupied since July 2025.

This range is either a major accumulation base or a classic distribution zone. After this latest earnings beat, if it were true accumulation, you’d expect institutions to drive a breakout higher. Instead, sellers once again used strength as an opportunity to offload, pushing price lower. That behavior tilts the evidence toward distribution.

If that’s the case, a break below the 200-day SMA and the ~$170 support (the floor of this channel) seems probable. That could open the door to at least the prior all-time high retest near $153, or even the 100-week SMA which is currently around $143.

NVDA Daily Chart

This scenario aligns closely with my broader market outlook. If you haven’t read my piece “The Deadly Flatline”, I highly recommend it. I believe the coming months will offer excellent opportunities—some already appearing in the most oversold names—but risk management will be essential. History shows that after prolonged, massive consolidations like this, breakdowns can be swift and violent (as detailed in the examples there).

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Key warning signs of weakness that I’m monitoring closely:

• GOOGL breaking its 100-day SMA

• NVDA decisively breaking its 200-day SMA

• SMH breaking below Friday’s bullish candle, which could trigger a bearish 10 EMA trade after a mature pattern. This trade could serve as an effective hedge on any broader downside for a tech focused portfolio. (Alternatively, SMH could still rally toward $435 for one final high before a deeper retest—but the setup favors caution.)

SMH Daily Chart

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Of course a break of SPY’s 100-day SMA would be a serious red flag. A decisive violation of the $675 support level would, in my view, confirm a larger move toward the 200-day SMA and key support at $654.

For QQQ, a test of its 200-day SMA feels increasingly likely. That’s the critical level to watch for now. Nearer-term supports sit at $600 and the anchored VWAP around $597. But with QQQ still below its 100-day SMA, those lower levels look vulnerable.

QQQ Daily Chart

Markets can stay irrational longer than expected, and chop can persist much longer than we would all like. But the weight of evidence points to caution right now. Stay nimble, manage risk tightly, and be ready—opportunities will emerge alongside the fear.

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