On that day, Wall Street traders probably never imagined that something like this could happen. In just two weeks, the market completely flipped from “extreme fear” to a “risk-ignoring frenzy.”

This is, in my view, a textbook case of a classic squeeze scheme. From being oversold to being overbought, the pace of the move was on a level that rewrote the past several decades of financial history. Nasdaq rose for 11 consecutive trading days, surging nearly 15% in a short period. The S&P 500 reached a historic moment—breaking through the 7,000-point threshold for the first time and closing at 7022.95. The Dow average edged down slightly, but the tech sector’s explosive momentum was overwhelming.

Tesla jumped 7.62% in a single day because Mr. Musk announced that the final design phase for mass production of AI autonomous-driving chips had been completed. This sent a signal to the market that Tesla is not just an automobile company, but a core player in AI computing. At the same time, Microsoft also climbed 11% over three trading days, adding nearly $300 billion in market capitalization. The cloud computing giant rode the wave of the AI boom.

In situations like this, the squeeze mechanism becomes clearly visible. The accumulated liquidity spilled out as if a dam had burst, and quantum computing–related stocks exploded as well. D-Wave Quantum surged by more than 22%, while Rigetti Computing and Arqit Quantum both recorded sharp jumps of 13% and 16%, respectively. The cryptocurrency market can’t be ignored either. Bitcoin broke through the $75,000 barrier, and Ethereum is also up more than 2.5%.

What made all of this possible? The answer is the instincts of capital—Fear Of Missing Out, or the fear of being left behind. As the U.S.-Iran conflict moved toward reconciliation and geopolitical risk dramatically eased, confidence returned to tankers in the Strait of Hormuz. With that, funds stopped shunning risk and rushed into risk assets.

Earnings season was also perfect. Morgan Stanley and Bank of America’s first-quarter results beat Wall Street expectations, and in particular, Morgan Stanley’s equity trading division achieved record quarterly results. The strong performance of the major banks proved the resilience of the U.S. economy, and concerns about consumer markets were also dispelled.

However, hidden behind all this glamour are warning signals. In the Federal Reserve’s April Beige Book, it pointed out that higher energy costs caused by the Middle East war are rippling through the entire supply chain. Many companies are shifting to a wait-and-see approach on hiring and capital expenditures. Inflation concerns remain strong, and the Fed has maintained its stance of keeping interest rates unchanged.

Today’s Nasdaq is indeed at the peak of sentiment. A squeeze-driven surge market is certainly beautiful, but while enjoying an upswing powered by this liquidity, you still need a touch of calm. So that you don’t end up being the one that gets trapped buying at the highs at the next turning point.