⚡ Index Breakout Just Began—Watch This Stock Accelerate
Summer Is Over — Maya Is Heading Back
Summer went by fast. One minute we were in Aruba on a pontoon in Eagle River, picking up David from camp, and arguing about who left the pickleball paddles in the car. The next minute we are packing boxes, buying a dish drying rack, and Googling “best plates that won’t break in a college apartment.”
Maya is going back to U of I.
She has a new apartment on campus this year, not the dorms. Small kitchen, big windows, and — most importantly for her — a real gym in the building. She toured it on FaceTime and gave us a full breakdown: where the plates go, where the coffee maker goes, how far the walk is to the business school. She’s already nesting, and she hasn’t even moved in yet.
Junior year is different. It’s not the “figure it out” years anymore. She’s in the hard accounting classes now — advanced financial reporting, audit, tax that makes even me want to close the book. She’s a perfectionist, always has been. Last year she finished with straight As. This year she says she wants to do it again.
Part of me is incredibly proud. Part of me worries about the pressure she puts on herself.
She already has what most kids are stressing about. She has the Deloitte internship lined up, she has a network, she has professors who know her name. She proved she can do the work. But in her head, anything less than an A feels like slipping. I’ve watched her rewrite the same accounting problem three times just to make the formatting perfect.
I get it. I live in a world where perfectionism can feel like an edge. In trading, you want to be precise, disciplated, flawless. But the market teaches you quickly that perfectionism is a trap. You will never have a perfect win rate. You will never time every top and bottom. If you try to get all As every day in the market, you burn out. The pros don’t aim for perfect, they aim for consistent, for process, for showing up.
I tell her the same thing I tell younger traders at Yellowtunnel. Grades matter, yes. Work ethic matters more. But learning to manage stress matters most. Deloitte didn’t hire her because she got a 4.0 once. They hired her because she’s reliable, curious, works hard, and actually likes the work. No client is going to ask her what she got in Intermediate Accounting II. They are going to ask if she can think clearly when it’s messy.
We spent yesterday packing her car. Plates wrapped in towels, gym clothes in a duffel, a new frying pan she insisted she needed after watching her mom fry that fish from Eagle River. She kept checking her list. I kept telling her she’ll be fine.
Summer suddenly being over is strange for a parent. The house gets quiet again. The driveway hoop will have one less player arguing about fouls. But it’s also exciting. She has her own place, her own routine, her own hard year ahead that she wants to crush.
I don’t think she needs to put that extra pressure on herself to be perfect. All As are great, but peace of mind is better. If she can learn that in junior year — that consistent effort beats perfection — she’ll be way ahead, not just in accounting, but in life.
We’ll drive down this weekend, carry boxes up three flights of stairs, build that IKEA shelf that always has one screw left over, and leave her with a stocked fridge and a hug.
And then I’ll come home, sit at my desk, and try to take my own advice about not worrying so much.
Markets work the same way. There is always another test, another earnings report, another Fed meeting, another trade that doesn’t go exactly as planned. The goal isn’t to ace every one of them. It’s to have a process you trust, manage the pressure, and stay consistent enough that the wins compound over time.
That feels especially relevant right now. With stocks near record highs and volatility low, it can be tempting to chase the perfect entry or assume every trade should work. But just like Maya heading into junior year, the real edge isn’t perfection. It’s preparation, discipline, and knowing that one bad grade—or one bad trade—doesn’t define the bigger picture.
Recent Trade Review
For our recent trade review, I want to highlight Airbnb (ABNB), a long opportunity identified by our Dynamic Power Trader (DPT) model and discussed during last Thursday’s Live Trading Room.
The DPT model identified ABNB as a potential long opportunity, giving subscribers a systematic, data-driven setup rather than relying on emotion or trying to chase the stock after a move had already begun. As always, the objective isn’t to predict every tick perfectly. It’s to identify higher-probability opportunities, define the trade, manage risk, and stay disciplined when the market moves.
This also highlights one of the biggest differences between our free and paid services. Educational content can help you understand what we’re watching, but paid subscribers receive timely SMS alerts when it’s time to enter and exit a position. In a fast-moving market, having the setup is only part of the equation—the timing and execution can matter just as much.
You can see the ABNB setup and our discussion from last Thursday’s Live Trading Room here!
Current Trading Landscape
Markets are closing out another eventful week near record highs as cooling inflation, easing Treasury yields and continued strength in AI and technology have kept the bulls firmly in control. The S&P 500 reached another all-time high Thursday, while the VIX remains near 15, reflecting strong risk appetite across the market. Beneath the surface, however, the outlook is becoming more complicated. A softer labor market and signs of weakening consumer activity are giving the Federal Reserve more reason to remain patient, while tariffs and the ongoing conflict with Iran continue to create uncertainty around oil and inflation.
For now, investors are embracing the idea that the economy is cooling without breaking, but with valuations elevated and volatility subdued, the margin for error is narrowing. The next phase of this rally may depend on whether consumers, earnings and economic growth can remain resilient enough to keep the soft-landing narrative—and the bull market—intact.
The long-term trend remains intact, with the major indexes trading at or near all-time highs. My longer-term SPY outlook continues to favor the $760-$780 area, while $700-$720 remains an important support zone over the next several months.
The biggest change in the market narrative has come from the economic data. Last week's July employment report showed the economy unexpectedly losing 23,000 jobs, versus expectations for roughly 80,000 new positions, while previous months were revised lower by a combined 103,000 jobs. That shifted the conversation from whether the Fed should raise rates toward whether it can raise rates without putting additional pressure on an already cooling labor market.
This week's inflation reports strengthened the case for patience. July CPI increased just 0.1% month over month and 3.4% from a year earlier, while core CPI rose 0.2% for the month and 2.5% annually. Energy prices declined, easing fears that the earlier oil shock would trigger another major acceleration in inflation.
Thursday's PPI report added to that relief. Producer prices were unchanged in July, while annual PPI slowed to 4.7% from 5.5% in June. The combination of softer inflation and weaker employment has reduced expectations for a September Fed rate hike and helped take pressure off Treasury yields.
Inflation hasn't disappeared, however. It remains above the Fed's long-term objective, tariffs could add pricing pressure, and three Fed officials dissented at the July meeting in favor of a 25-basis-point hike. The 10-year Treasury yield remains volatile in the mid-4% range as investors continually reassess inflation, growth and monetary policy. For equities, the primary rate risk remains interest rates staying higher for longer. Even if the Fed pauses in September, that isn't the same thing as aggressive easing.
Friday's data added another concern. July retail sales unexpectedly fell 0.6%, compared with expectations for a 0.2% increase, while preliminary August consumer sentiment weakened to 51.0 from 55.2 in July. Combined with the employment report, the numbers suggest parts of the economy are clearly losing momentum.
For now, markets are treating weaker economic data as supportive because it reduces pressure on the Fed. But bad economic news is only good for stocks up to a point. If employment and consumer spending cool gradually while inflation declines, the Fed gains flexibility and the soft-landing argument strengthens. If the slowdown begins materially affecting consumption and corporate earnings, the narrative can change quickly.
Oil and the Middle East add another layer of uncertainty. Crude has experienced large swings as markets react to developments surrounding Iran and the Strait of Hormuz. Lower oil prices have helped reduce immediate inflation pressure, but renewed geopolitical escalation could quickly send crude higher.
The chain remains straightforward:
Iran and Hormuz → Oil Prices → Inflation → Treasury Yields → Fed Policy → Stocks
As long as oil moderates, it works in the bulls' favor. Another significant spike could revive inflation concerns, push yields higher and reinforce the higher-for-longer rate environment.
Corporate earnings remain an important counterweight to these macro risks, particularly in AI and technology. Strength across networking, semiconductors, data centers and AI infrastructure continues to demonstrate substantial corporate investment in artificial intelligence. That matters because this rally isn't based entirely on hopes for easier monetary policy; earnings growth and AI spending continue to provide fundamental support underneath technology shares.
Expectations are high, however. With stocks near records and the VIX around 15, companies increasingly need to deliver strong results and guidance. Any indication that AI spending is slowing or failing to generate adequate returns could create sharp sector-level volatility.
The next major test will come from the consumer. Walmart, Target, Home Depot, Lowe's and TJX report next week, providing a broad look at household spending following the weak employment and retail-sales reports. Management commentary on traffic, discretionary purchases, pricing and tariffs could be just as important as the headline numbers.
The economic calendar will also be busy. Tuesday brings Housing Starts, Building Permits, Industrial Production and Capacity Utilization. Wednesday's FOMC minutes could be particularly important given the three policymakers who favored a July rate hike. Initial Jobless Claims follow Thursday, with preliminary Manufacturing and Services PMI readings on Friday.
Together, those reports and retail earnings should provide a clearer picture of whether the economy is experiencing the controlled slowdown bulls want or something more concerning.
For now, the bulls remain in control. Stocks are near record highs, volatility remains subdued, inflation is moderating, Treasury yields have eased from recent peaks and corporate earnings continue to support valuations.
That keeps me in the MARKET BULLISH camp. I continue to believe SPY can trade into the $760-$780 range, with $700-$720 representing important support over the coming months.
The biggest risks remain higher-for-longer interest rates, renewed inflation, tariffs, another oil spike tied to Iran and the Strait of Hormuz, and a labor-market slowdown that begins materially affecting consumer spending and corporate profits.
The market has largely gotten what it wanted: cooler inflation, lower rate-hike expectations and continued earnings strength without clear evidence of recession. The challenge now is keeping the economy in that narrow window—cool enough to give the Fed room to wait, but strong enough to keep earnings and the consumer intact.
24 hours left — this week's six names went out this morning
This week's six signals went out to Weekly Power Trader subscribers a few hours ago.
The August Sale ends tonight at midnight.
Join before then and this morning's list is yours — six bullish names, one to four week horizon, entries and stops included. It's the list that positions into Jackson Hole on the 27th and the FOMC on September 16.
$197→$97 — about $8/wk
[ JOIN BEFORE MIDNIGHT → ]
30 days, money back, no argument.
Sector Spotlight: Consumer Discretionary (XLY)
This week, I am focusing on the Consumer Discretionary sector and the Consumer Discretionary Select Sector SPDR Fund (XLY).
Consumer discretionary is becoming one of the market's most interesting battlegrounds. Friday's weaker retail sales and consumer sentiment data suggest households are becoming more selective, but that does not necessarily mean discretionary spending is collapsing. Instead, spending appears increasingly concentrated around companies offering value, convenience, strong brands and experiences.
That makes XLY particularly interesting in the current environment. The fund provides exposure across retail, automobiles, restaurants, travel and leisure, with Amazon and Tesla its two largest holdings. Hotels, restaurants and leisure represent roughly 27% of the portfolio, while broadline and specialty retail account for nearly half.
The macro backdrop could also become increasingly favorable. Cooling inflation, lower oil prices and easing Treasury yields can improve household purchasing power and reduce pressure on discretionary businesses. At the same time, softer economic data gives the Federal Reserve more reason to remain patient. If the economy achieves the soft landing the market is currently pricing in—slower growth without a meaningful contraction—consumer discretionary could benefit from both resilient spending and a less restrictive rate environment.
There are risks. A deeper labor-market slowdown would eventually pressure consumer spending, tariffs could raise costs, and another spike in oil could squeeze household budgets. That makes next week's earnings from Walmart, Target, Home Depot, Lowe's and TJX particularly important as a real-time test of consumer health.
For now, however, the broader trend remains bullish. The consumer may be more selective, but spending has not disappeared, travel demand remains resilient, and lower inflation and easing rate pressure could provide an improving backdrop for the sector. With markets near record highs and the VIX around 15, I believe XLY offers an attractive way to participate if the economy continues cooling without breaking.
Trade of the Week: Airbnb (ABNB)
Building on our Consumer Discretionary outlook, this week's Trade of the Week is Airbnb (ABNB).
Airbnb sits at the intersection of several themes supporting the current market: resilient discretionary spending, continued demand for travel, international growth and increasing use of AI to improve efficiency. More importantly, the company's latest earnings provided evidence that those trends are translating into real financial results.
Airbnb reported second-quarter revenue of $3.61 billion, up 17% from a year earlier and ahead of expectations. Gross booking value increased 16% to $27.2 billion, while nights and experiences booked climbed 10% to 148.3 million. North American bookings posted their strongest growth in nearly three years, while markets including Brazil and India provided additional international strength. Airbnb also raised its full-year revenue outlook to at least mid-teens growth.
That performance is particularly encouraging given the concerns surrounding the consumer. Travel remains an area where households—particularly higher-income consumers—continue to prioritize spending, even as they become more selective elsewhere. Airbnb's results suggest demand remains resilient despite higher travel costs and geopolitical disruptions.
AI is becoming another important part of the story. Airbnb says its AI-powered customer-service agent can already resolve 45% of customer issues without human intervention, while AI tools are also being used to reduce friction and improve conversion across the platform. At the same time, Airbnb continues expanding beyond traditional home rentals into services and boutique hotels, giving the company additional avenues for growth.
The market has noticed. ABNB surged following its earnings report and closed Thursday at $185.13, just over 1% below its 52-week high after gaining 2.8% during the session.
The broader macro environment could provide another tailwind. Cooling inflation, lower oil prices and easing Treasury yields would be supportive for travel demand and consumer spending, while a more patient Federal Reserve could help discretionary valuations. Continued progress toward reducing tensions around Iran and the Strait of Hormuz would also help by lowering energy and transportation costs.
There are clear risks. A deeper economic slowdown could pressure travel budgets, renewed Middle East escalation could increase airfare and energy costs, and the stock's strong post-earnings rally means expectations are considerably higher than they were a few weeks ago.
Still, Airbnb combines strong earnings momentum, resilient travel demand, international expansion and improving operating efficiency with a broader market that remains near record highs. That combination makes ABNB one of the more compelling consumer discretionary names on my radar and our Trade of the Week.
This week, I am adding Airbnb (ABNB) to my portfolio.
And one more thing! Our track record speaks for itself from the standpoint of a Winning Trades Percentage, Average Return Per Trade, and Net Gain. Just take a look:
The consistent performance of our services is just incredible. My historical stellar performance is made possible by being right on 82.26% of all trades that I made, with an average profit of 39.75% per trade on our collective trade recommendations. To my knowledge, this trading performance is one-of-a-kind and stands alone in the marketplace for superior trading advice, where our numbers and results speak for themselves.
For the rest of 2026, the market is entering a more selective and demanding phase. On the surface, major indexes remain resilient, but underneath, investors are navigating a more complicated environment shaped by geopolitical tensions, tariff uncertainty, uneven megacap earnings, sticky inflation expectations, and renewed pressure from interest rates. At the same time, labor market data is beginning to soften at the edges, creating a setup where discipline, timing, and data-driven decision-making are becoming more important than broad market optimism.
This is exactly where YellowTunnel becomes essential.
In a market where leadership is narrowing and volatility can return quickly, investors need more than headlines and guesswork. YellowTunnel’s AI-powered tools are designed to help you cut through the noise, identify high-probability setups, track changing market conditions, and stay aligned with the strongest pockets of opportunity. Whether you are looking for real-time trade ideas, advanced stock and options analysis, predictive market data, or a more disciplined trading process, YellowTunnel gives you the structure and clarity needed to act with confidence.
As conditions tighten heading into Q3, the difference between reacting emotionally and following a proven, data-backed approach can be significant. Our goal is to help you stay prepared, stay selective, and stay focused on the opportunities with the strongest risk-reward potential.
Whether you are focused on short-term trades, portfolio positioning, options strategies, or improving your overall trading mindset, YellowTunnel provides the tools, insights, and guidance to help you navigate this market with greater precision.
Let’s work together to make the rest of 2026 a stronger, smarter, and more disciplined period for your portfolio. As always, successful investing begins with informed decisions, proper risk management, and a clear understanding of your personal goals and risk tolerance before entering any trade.
One more thing, I've had the opportunity to take additional action with a great organization supporting families in Ukraine directly. Gate.org is a foundation where fundraising is held for specific families, allocating funds to multiple families currently living in Ukraine. I am on the board of directors for this great initiative and encourage everyone to check it out and donate if possible. The war in Ukraine is escalating, and families are being negatively impacted and displaced daily. To learn more about this initiative to help families, please see the link below:
Wishing you a week filled with resilience, growth, and prosperous opportunities!