The TML Talk | April 27th, 2025

Market Overview

• Indexes and General Market Trend:
  • The NASDAQ posted back-to-back follow-through days — a rare event last seen coming out of the 2022 lows — confirming a shift toward a potential new uptrend. Strength was reinforced by a Zweig Breadth Thrust and extremes in sentiment, flashing rare bullish signals.
  • The S&P 500 confirmed with its own follow-through days, though with slightly less force than the NASDAQ. Both indexes are now grappling with resistance at declining 50-day and 65-day moving averages. As expected, some stalling and chop have emerged as major averages are tested.
  • Small caps, via $IWM, show relative resilience, trading tighter and leading on a relative basis after months of underperformance. The Dow remains the laggard, following the S&P in wider, looser fashion. The strongest sector rotation remains concentrated in technology and selective consumer names.
• Current Market Status:
  • While the broad action has improved significantly from the depths of March, true group leadership remains underdeveloped. Breakouts are occurring, but many leaders are extended after sharp runs, with few clean bases offering textbook buy points.
  • Earnings season adds another layer of complexity. Many top names approach key reports in the coming days, creating landmines for traders deploying size. The market’s underlying tone is much healthier than a month ago, but precision remains critical.
  • Short-term, indexes are extended and due for consolidation. The next move — either continuation through moving average resistance or a pullback into logical support — will likely set the tone for the next leg.

Key Lessons & Quotes

• “We have had an official follow-through day, and then we had back-to-back follow-through days… back-to-back follow-throughs were pretty rare but clearly a very strong indicator.”
• “We’re starting to lose a little steam as we run into the declining 50-day simple moving average… I expect there to be resistance here, and stocks sticking up in the air — some of the strongest ones — will do exactly what you don’t expect and continue to push without you.”
• “The extra broad watchlist was to show we’re potentially turning here. It got broader. There’s less names coming off the bottom. It’s a much higher quality list — but we’re still missing clear groups where everything’s setting up together.”
• “Be very careful of earnings. There’s tons of stuff with earnings in the way, and that’s very common. Plenty that will work and give you another spot later, but no reason to force anything right into reports.”
• “The opportunity of a lifetime comes every other day in the stock market. I don’t stress too much about missing the first entry. I focus on what setups look like now, not what I should have done yesterday.”
• “Sometimes Bill would say you’ve got to figure out a way to get into the leader — even if you missed the first move. You manage risk, you day trade your way in, you just find a way. That stuck with me forever.”

Actionable Takeaways

• Respect Earnings Risk: Many leaders have earnings in the next one to two weeks. Avoid taking large size ahead of reports unless deep profits are built in.
• Stay Selective: Focus on stocks showing powerful volume surges and tight consolidations above major moving averages — not laggards rallying off lows.
• Trim Extended Names: With indexes short-term extended, it’s smart to take partial profits into strength and reduce exposure if earnings results disappoint.
• Test Traction First: Use smaller pilot positions (5–15%) in new entries; only scale up aggressively if stocks confirm by moving cleanly on volume.
• Prioritize Group Confirmation: Rotation into groups like biotech, aerospace, and quantum computing is starting — but needs further confirmation before betting big.

Stock Mentions and Commentary

Information Technology – Software & Cybersecurity:

• $PLTR: Strong push off lows; tight action through resistance. Watching for continued constructive consolidation.
• $CRWD: Holding strong post-breakout; extended but leadership quality name. Monitoring for potential secondary entry.
• $IONQ: Tight weekly structure forming; strong action among quantum names. Needs continuation through recent highs.
• $RGTI: Tight setup; one of the better relative strength names in quantum. Watching for breakout strength.
• $QBTS: Volatile action tightening slightly; speculative performance enhancer. Waiting for cleaner trigger.
• $MSTR: Strong technical setup above major averages; speculative but powerful chart structure.

Communication Services – Internet Content & Information:

• $HOOD: Strong move through averages; earnings event approaching. Careful with near-term risk.
• $GRPN: Early stage breakout attempt; massive volume burst. Key resistance around $20 remains critical.
• $NFLX: Leading post-earnings mover; extended but maintaining strong trend. Still watching for possible pullback opportunity.
• $SPOT: Tight constructive action ahead of earnings; reclaiming key moving averages. Potential setup developing.

Consumer Discretionary – Restaurants, Retail, and Leisure:

• $BROS: Coffee chain reclaiming averages; back in constructive range. Watching for volume confirmation.
• $LTH: Gym stock coiling tightly; moving averages stacked underneath. Tight setup could trigger on strength.
• $DASH: Working toward green line breakout; earnings May 7. Needs strong push through resistance.
• $CHWY: Pet retailer tightening after long base; relative strength improving. Monitoring action near resistance.
• $TSLA: Strong reversal through trendline; massive upside reaction off earnings. Directional mover — watching continuation.

Consumer Staples – Beverages:

• $CELH: Tightened up over recent weeks; solid relative strength compared to peers. Needs volume confirmation.
• $MNST: Holding steady near highs; slower mover, supportive of sector strength. Secondary focus name.

Financials – Insurance and Capital Markets:

• $ROOT: Speculative insurance name; early signs of accumulation. Whippy action — suitable for small size trades.
• $WRB: Stable insurance name; holding up near highs. More defensive exposure if needed.

Health Care – Biotechnology and Pharmaceuticals:

• $GH: Tight action around major averages; showing leadership qualities. Watching for clean continuation setup.
• $GRAL: Power move off support; directional but needs consolidation. Potential performance enhancer.
• $TGTX: Strong earnings profile; higher quality biotech setup. Monitoring around upcoming earnings.
• $VRNA: Tight weekly chart; near prior highs. Low volatility biotech compared to peers.
• $SLNO: Speculative biotech name; potential revenue growth story. Higher risk setup.

Industrials – Aerospace & Defense and Infrastructure:

• $RKLB: Aerospace name working through moving averages; tightening up constructively. Watching for accumulation to continue.
• $ROAD: Early accumulation signs forming. Monitoring for further development.
• $AGX: Infrastructure-related name tightening up. Worth monitoring for setup confirmation.
• $GEO: Correctional services stock building a tighter base. Secondary monitoring.
• $LOAR: Aerospace name coiling up constructively. Watching for breakout action.

Materials:

• $AEM: Gold miner consolidating; extended from early breakout. Watching for tighter setup.

ETFs

• $IBIT: Bitcoin ETF holding gains; strength continuing with broader crypto trend. Monitoring near highs.

Utilities

• $GEV: Holding strong near highs; tight chart structure developing. Watching for breakout continuation.

Ross’ Watchlist

• Communication Services: META RBLX RDDT SPOT* TKO
• Consumer Discretionary: ATGE BABA BROS* CHWY DASH* DUOL EAT GRPN* LRN LTH* MELI MMYT TSLA* XPEV 
• Consumer Staples: CELH* MNST* WMT
• Financials: ROOT* TOST* WRB
• Health Care: ADMA AUPH GH* GKOS GRAL* IRTC LQDA MCK NTRA* RGC RPRX RYTM SLNO* SRRK TARS TGTX* VRNA* WGS*
• Industrials: AGX* DXPE GEO* LOAR* RKLB* ROAD
• Information Technology: AVGO CLS FTNT GWRE IONQ* NET OSIS PAY PEGA PLTR* QBTS* RBRK* RGTI* SNOW TTAN* ZM
• Materials: AEM*
• ETFs: IBIT*
• Real Estate: ZG
• Utilities: GEV* OKLO