Looking back at this move in the Nasdaq, it boils down to one thing: every time my stop gets hit and I’m forced out, the market immediately reverses. I got stopped out right at the lows last week, and the very next day it rallied straight back. At one point, it was down more than 1.5% intraday and looked poised to break below the previous low. Then buyers poured in late in the session, wiping out almost the entire loss by the close. The next day, it opened higher, leaving the position that had been stopped out behind. This “break down first, then reverse and reclaim” pattern hasn’t been a one-off in recent months: sometimes the index swings more than 2% intraday, loses its 20-day moving average, then closes back above it the next day; sometimes stop orders just below the previous low get filled, and the market immediately turns around. Now I’m actually afraid to set a stop. You’ve got to admit, it’s infuriating.

Fifteen years of watching market cycles have taught me that this setup does bear some resemblance to several historical bubble tops: valuations aren’t cheap, gains are concentrated in a handful of heavyweight stocks, momentum indicators are diverging, market breadth is narrowing, and the refrain that “every pullback is a buying opportunity” is getting louder. You can find a similar mix around the tops of the dot-com bubble in 2000 and growth stocks in 2021. But “similar” doesn’t mean “the same.” Tops can look alike while playing out on completely different timelines and being driven by entirely different catalysts. Some markets churn sideways for months before topping; others plunge on a single headline; and sometimes what looks like a double top is ultimately negated by a new high. The market is great at one thing: just when you’re sure the direction is settled, it puts on another show.

So I’ll put my take here for now: the direction is set, but the path won’t be straight. There will be false breakouts, stop hunts, and sharp reversals along the way. Especially at times like this, you can’t let a single day’s move dictate your decisions. I’ll be back tomorrow to see how it plays out.