The weekly reports include tactical ensemble and strategic allocation updates, a stock market forecast, and analysis of capital markets and price action. To access the full reports, you must subscribe to Premium Articles or Weekly Premium Articles.

Weekly Market Report

1. Performance of tactical ensemble and strategic allocation
2. Price action analysis, weekly market summary, and market forecast
3. Details of tactical ensemble and strategic allocation
4. Market dynamics discussion and conclusion

Section 2 covers trends in asset performance and an analysis of the drivers of the current market dynamic. We discuss current patterns in price action and review the performance of a pair trade involving a gold ETF.
Section 3 details the performance of our tactical and strategic allocations.
Section 4 discusses reflexivity in financial markets.

1. Performance of tactical ensemble and strategic allocation

For the week ending Friday, May 29, 2026:

• The weekly strategies tactical ensemble (WRE) gained 2.8% with equal allocation. Year-to-date: +19.8%
• The Price Action Lab strategic allocation (PALSA) gained 3.7%. Year-to-date: +22%.
• The SPY ETF gained 1.5%. Year-to-date: +11.2%

For the open positions and any new signals of WRE, see Section 3. We also include the PALSA strategic allocation details and the performance when the volatility matches that of the SPY ETF, with 1.7x leverage, which is up 37.3% year-to-date. The WRE (Lev) tactical allocation is up 27.9% year-to-date with 1.6x leverage to match the SPY ETF volatility.

2. Price action analysis, weekly market summary, and market forecast

The S&P 500 index rose for a ninth week, and the win streak gain reached 19%. The histogram below shows the rolling 9-week returns for the S&P 500 index since 1947.

The return of 19% in nine weeks is close to three standard deviations, at 19.9%, based on the available sample with a size of 4,141 (rolling returns). Below, we present historical forward results for when the S&P 500 has gained more than 17% in nine weeks since 1950, along with a statistical analysis of the distribution of 9-week returns.

You must sign up for Premium Articles or Weekly Premium Articles in order to view the complete reports.

Particular disclaimer: Charts in this article may refer to price levels. We might skip updating the charts if market conditions alter price levels or affect any analysis based on them. All charts in this article are for informational purposes only. See the disclaimer for more information.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

If you found this article interesting, you may follow this blog via RSS, email, or Twitter.

Weekly Market Report: Reflexivity was originally published on Price Action Lab

The weekly reports include tactical ensemble and strategic allocation updates, a stock market forecast, and analysis of capital markets and price action. To access the full reports, you must subscribe to Premium Articles or Weekly Premium Articles.

Trading schedule note: U.S. markets are closed Monday, May 25, in observance of the U.S. Memorial Day holiday.

Weekly Market Report

1. Performance of tactical ensemble and strategic allocation
2. Price action analysis, weekly market summary, and market forecast
3. Details of tactical ensemble and strategic allocation
4. Market dynamics discussion and conclusion

Section 2 covers trends in asset performance and an analysis of the drivers of the current market dynamic. We discuss current patterns in price action and review the performance of a pair trade. We also look at inflation-adjusted crude oil prices.
Section 3 details the performance of our tactical and strategic allocations.
Section 4 discusses reversion to the mean for equity returns.

1. Performance of tactical ensemble and strategic allocation

For the week ending Friday, May 22, 2026:

• The weekly strategies tactical ensemble (WRE) gained 1.8% with equal allocation. Year-to-date: +16.6%
• The Price Action Lab strategic allocation (PALSA) gained 1.8%. Year-to-date: +17.6%.
• The SPY ETF gained 0.9%. Year-to-date: +9.6%

For the open positions and any new signals of WRE, see Section 3. We also include the allocation details and the performance of PALSA (Lev) when the volatility is matched up to that of the SPY ETF, with 1.7x leverage, which is up 29.9% year-to-date. The WRE (Lev) tactical allocation is up 22.4% year-to-date with 1.6x leverage to match the SPY ETF volatility.

2. Price action analysis, weekly market summary, and market forecast

The S&P 500 index rose for an eighth week, and the win streak gain reached 17.3%. The histogram below shows the rolling 8-week returns for the S&P 500 index since 1947.

The return of 17.3% in eight weeks is close to three standard deviations, at 18.7%, based on the available sample with a size of 4,142 (rolling returns).

Only another 8-week win streak has yielded in the past a gain of more than 17%, and that was for the week ending June 20, 1997, and during a period when the dot-com rally had accelerated. The 1977 win streak with a gain of 17.4% came six months after the Federal Reserve chairman, Alan Greenspan, coined the term “irrational exuberance” but without explicitly asserting that the US stock market was in a bubble state. Some analysts and investors assert there are some similarities with the current regime, but there are also notable differences, which have been discussed before in these reports but briefly include the rise of AI and unprecedented geopolitical uncertainty. Given that market regimes are dynamic and non-stationary, the best way to deal with price action is with robust strategic and tactical allocations, which is a main objective of these reports. Fundamental and technical analysis can help for risk management purposes, but ambiguity, subjectivity, and a low signal-to-noise ratio could limit the effectiveness of these methods.

Below is a table of 4- and 12-week forward returns after 8-week returns greater than 17%

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Particular disclaimer: Charts in this article may refer to price levels. We might skip updating the charts if market conditions alter price levels or affect any analysis based on them. All charts in this article are for informational purposes only. See the disclaimer for more information.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

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Weekly Market Report: Reversion to the Mean was originally published on Price Action Lab

The update includes important information for Premium Articles, Weekly Market Signals, and Monthly Signals subscribers.

Update: Strategic allocation in weekly market reports

The strategic allocation for 2026 was announced in late 2025. The allocation is strategic in the sense that it is passive for the whole year. However, for next year, we will probably make some changes to the allocation in both assets and weights.

The strategic allocation is up 17.1% year-to-date (Thursday, May 21, 2026). The SPY ETF is up 9.2%. Below is the backtest from 2020.

With 1.7x leverage to match the volatility of the SPY ETF, the strategic allocation is up 29.1% year-to-date. (Thursday, May 21, 2026). Below is the backtest from 2020.

We expect some correction in months ahead, as markets appear overextended.

Update: ETF selection for weekly and monthly signals

Disclaimer: Investing in any market, including exchange-traded products (ETPs, ETFs, and ETNs), could result in a total loss of capital. The premium content is provided for informational purposes, not as investment advice or actionable content. We do not warrant the accuracy, completeness, fitness, or timeliness of premium content for any particular purpose. You should never treat the premium content as financial advice. At times, we may hold positions, long or short, calls or puts, in several exchange-traded products that are mentioned in these reports. Furthermore, this website’s author is not a registered financial adviser. Before subscribing, please read our Disclaimer and Terms and Conditions.

Update: Premium Articles, Weekly and Monthly Signals Subscribers was originally published on Price Action Lab

The world stopped when the S&P 500 moved 15 points in 2002. Traders handled it like market turmoil. That 15-point movement represented around a 2% change at the time, when the index was trading around 900. This was actual volatility that moved the markets.

The S&P 500 index is close to 7,400. The same 15-point move is now only 0.2%, which is background noise. However, the response is similar to the early 2010s, when a 15-point move was equivalent to a 1% drop and triggered allegations of manipulation or an algo squeeze. Let’s look at a chart for perspective:

The top chart, in log scale, shows how a 15-point change as a percentage of the previous day’s closing price since the mid-1940s has decreased from about a 100% loss to a mere 0.2% random noise. The middle chart shows the same evolution of 15-point changes in a linear scale. The bottom chart shows absolute daily returns: 0.2% or smaller changes have occurred nearly 25% of the time. The market’s natural state is characterized by average absolute daily changes of approximately 0.65%, with a standard deviation of about 0.75%. Daily moves around the mean are noise, and those below 1.4% are not significant. Did we observe a 2% change in the index? That may be significant, statistically speaking.

The market’s small daily fluctuations do not prove manipulation. The cognitive tendency to hold onto outdated information and update opinions slowly when the world changes is known as conservatism bias. Thirty years ago, when the index was a tenth of its current size, market participants developed a mental image of what a big move in index points looks like. The index has increased tenfold, but the majority of traders and pundits cling to the preexisting framework. The outcome? They continue to use yesterday’s ruler to assess the current market. The unsettling reality they are overlooking is that what appears to be “suspicious swings” is precisely what a healthy random walk should look like. Today’s 20 or even 80 point changes, although in the past they reflected market turmoil, are manifestations of a random walk and not indicative of manipulation.

Disclaimer: No part of the analysis in this blog constitutes a trade recommendation. The past performance of any trading system or methodology is not necessarily indicative of future results. Please review the full disclaimer here.

Our weekly market report is now available on Substack. Click below to subscribe.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

15 Points Don’t Matter Anymore: It’s Just a Random Walk was originally published on Price Action Lab

The weekly reports include tactical ensemble and strategic allocation updates, a stock market forecast, and analysis of capital markets and price action. To access the full reports, you must subscribe to Premium Articles or Weekly Premium Articles.

Weekly Market Report

1. Performance of tactical ensemble and strategic allocation
2. Price action analysis, weekly market summary, and market forecast
3. Details of tactical ensemble and strategic allocation
4. Market dynamics discussion and conclusion

Section 2 covers trends in asset performance and an analysis of the drivers of the current market dynamic. We discuss current patterns in price action and attempt to identify historical analogs.
Section 3 covers the performance of our tactical and strategic allocations.
Section 4 discusses confirmation bias and a recent example.

1. Performance of tactical ensemble and strategic allocation

For the week ending May 15, 2026:

• The weekly strategies tactical ensemble (WRE) fell 0.65% with equal allocation. Year-to-date: +14.6%
• The Price Action Lab strategic allocation (PALSA) fell 1.45%. Year-to-date: +15.4%.
• The SPY ETF gained 0.2%. Year-to-date: +8.7%

For the open positions and new signals of WRE, see Section 3. We also include the allocation details and the performance of PALSA (Lev) when the volatility is matched up to that of the SPY ETF, with 1.7x leverage, which is up 26.2% year-to-date. The WRE (Lev) tactical allocation is up 19.0% year-to-date with 1.6x leverage to match the SPY ETF volatility.

2. Price action analysis, weekly market summary, and market forecast

Stocks had a strong rally after March 30, 2026, with a 7-week win streak and a combined gain of 16.3%. We will look at two different patterns involving a combined return of more than 15% in 7 weeks.

The histogram below shows the 7-week returns for the S&P 500 index since 1947.

A return of 16.3% in seven weeks is close to three standard deviations, at 17.4%, based on the available sample with a size of 4,144 (rolling).

Below is a table of 4- and 12-week forward returns after a 7-week return greater than 15%.

You must sign up for Premium Articles or Weekly Premium Articles in order to view the complete reports.

Particular disclaimer: Charts in this article may refer to price levels. We might skip updating the charts if market conditions alter price levels or affect any analysis based on them. All charts in this article are for informational purposes only. See the disclaimer for more information.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

If you found this article interesting, you may follow this blog via RSS, email, or Twitter.

Weekly Market Report: Confirmation Bias was originally published on Price Action Lab

Sophisticated investors and also allocators may decide to exit one fund with a large drawdown but not another. What drives their decision? Here is the answer.

One of the most important metrics that sophisticated investors and allocators consider following a significant drawdown is the expected recovery time. They exit the fund due to the opportunity cost, which is of paramount importance in the investment industry, if the anticipated time for the fund to recover the losses is prolonged. Despite the fact that they may consider other metrics and indicators, the expected recovery time is likely the most critical item on the list. How can it be estimated?

Based on reasonable assumptions, and as subscribers to this blog already know, the drawdown duration is proportional to the inverse of the square of the Sharpe ratio. This formula is a good measure of the expected drawdown duration of a fund in years:

Drawdown duration ≅ 1/(Sharpe)²

Here are two examples:

Example 1: If the Sharpe ratio is 0.50, then the expected recovery time is 4 years.

Example 2: If the Sharpe ratio is 0.75, then the expected recovery time is 1.8 years.

The difference from 4 to 1.8 years in expected recovery time is significant.

The above formula also explains why the Sharpe ratio is important despite claims to the contrary.

After all, it doesn’t matter which metric makes more sense, but which metric those who allocate the big money use. I will also agree that the Sharpe ratio has some issues, but it’s the standard.

One of the main issues is the sample size. For example, in the case of CTAs with many decades of performance data, the estimates are more robust than in the case of a new fund with only a few years of trading. Note that we are talking here about years, not number of trades.

All in all, the Sharpe ratio is an important metric, but so is volatility when considered separately. In fact, based also on reasonable assumptions, the expected drawdown depth is proportional to volatility and inversely proportional to the Sharpe ratio:

Drawdown depth ≅ Vol/Sharpe

Example 3: If the Sharpe ratio is 0.50 and volatility is 15%, then the expected drawdown depth is 30%.

Example 4: If the Sharpe ratio is 0.75 and volatility is 15%, then the expected drawdown depth is 20%.

The estimates in examples 1 through 4 are rough but provide a general idea: strategies with higher Sharpe ratios and lower volatility are more desirable despite the fact that, over the long term, some low-Sharpe and high-volatility strategies may generate higher total return. The main reason: investors do not have the patience to wait for slow recovery times due to opportunity cost.

Disclaimer: No part of the analysis in this blog constitutes a trade recommendation. The past performance of any trading system or methodology is not necessarily indicative of future results. Please review the full disclaimer here.

Our weekly market report is now available on Substack. Click below to subscribe.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

The Real Reason Sophisticated Allocators Exit Funds Post-Drawdown was originally published on Price Action Lab

We look at the updated CPI chart and briefly discuss the ongoing process of inflating away the US public debt. Our focus is on the winners and losers and the second-order non-linear effects due to the “AI-fication” of the US economy.”

Numerous well-written articles in the financial media and blogosphere discuss the mechanics and historical examples of inflating away the debt. In light of the latest CPI release, we will refer again to the persistent attempts by some economists and politicians to alienate the public with references to falling inflation after the unsuccessful call to “transitory inflation” a few years back.

The easiest way to think about the dynamics of the price level (CPI) is that it behaves like a stock price: every change has a permanent impact on the series. If inflation stays unchanged, then the rise is not canceled and the price level remains unchanged. If inflation rises at 2% annually, the price level will constantly rise. The hope is that real growth will be positive and the real earnings will increase. But the last 6 years have presented challenges due to the process of inflating away the debt.

The top chart shows the CPI series (not seasonally adjusted). By May 2023, some economists and politicians declared inflation dead because the year-over-year level fell significantly. The CPI rate of change drop is shown in the middle chart. But the top chart shows what we claim: despite the significant drop year-over-year (the 11-month ROC is shown due to a recently skipped data point), the price level continued on the same uptrend. What you see on the chart is a manifestation of multiplicative dynamics.

In other words, only the slope of the new uptrend was affected by the falling YoY CPI after the peak of June 2022 at 9.1%, and the new uptrend that started in 2020 remained intact. This new uptrend is doing the “inflating away the debt” heavy lifting and is now 27% above the post-GFC uptrend. No politician or central bank official will admit that their policy is to inflate away the debt because it is a controversial topic with many risks, some of which have already materialized.

Briefly, to maintain positive real growth, the US economy was driven toward “AI-fication” with a focus on artificial intelligence investments and applications. The big gamble here of enormous proportions is that artificial intelligence will increase productivity and growth. Scores of social media accounts were fed with the narrative of e/acc and a drive toward abundance, and we lately witnessed some of them becoming skeptics. No one can ignore the 28% official inflation over the past 64 months and the damage it has inflicted on purchasing power. Add the Middle East war on top of this. Was this another attempt to accelerate the process of inflating away the debt? The latest PPI release was frightening.

If you are to keep something from this article, it is that the price level never falls and continues to go higher because this is by design of the economic and financial systems. Even if “inflation falls,” the price level continues to rise, and there are winners and losers. First, the winners:

1. The 0.1% that benefits from deficit spending.
2. The managers who work for the 0.1% with high salaries.
3. Entrepreneurs who adapt to inflationary dynamics
4. Investors with sufficiently large portfolios in passive index funds.

Next the losers:

• Everyone else

The portfolios of long-duration bond holders have been decimated.

The TLT ETF is 41% below the 2020 highs. Meanwhile, the SPY ETF just made new all-time highs.

The choice was made as to who to screw, but it was never announced. Those who trusted the government with their hard-earned money and purchased long-duration bonds got hit hard. Speculators in stocks were rewarded. Of all the risks from inflating away the debt, loss of credibility of the system is one of the worst. The next risk is a permanent loss of purchasing power that will require an adjustment of the standard of living downward, and it is also unfolding. Meanwhile, the bosses of the “AI-fication” of the best industrial economy on this planet ever in the past are enjoying their best years and an amazing increase in wealth. And it seems we are just at the beginning of AI-fication turning into AI feudalism.

Disclaimer: No part of the analysis in this blog constitutes a trade recommendation. The past performance of any trading system or methodology is not necessarily indicative of future results. Please review the full disclaimer here.

Our weekly market report is now available on Substack. Click below to subscribe.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

Inflating Away the Debt and the AI-fication of the US Economy was originally published on Price Action Lab

The weekly reports include tactical ensemble and strategic allocation updates, a stock market forecast, and analysis of capital markets and price action. To access the full reports, you must subscribe to Premium Articles or Weekly Premium Articles.

Weekly Market Report

1. Performance of tactical ensemble and strategic allocation
2. Price action analysis, weekly market summary, and market forecast
3. Details of tactical ensemble and strategic allocation
4. Market dynamics discussion and conclusion

Section 2 covers trends in US and foreign asset performance and an analysis of the drivers of the current market dynamic. We discuss how the stock market has just delivered a right-tail event despite widespread expectations of a left-tail one.
Section 3 covers the performance of our low-turnover tactical and strategic allocations. No hype, no outrageous claims, just simplicity and robustness.

1. Performance of tactical ensemble and strategic allocation

For the week ending May 8, 2026:

• The weekly strategies tactical ensemble (WRE) gained 4.2% with equal allocation. Year-to-date: +15.3%
• The Price Action Lab strategic allocation (PALSA) gained 5.3%. Year-to-date: +17.1%.
• The SPY ETF gained 2.4%. Year-to-date: +8.5%

For the open positions and new signals of WRE, see Section 3. We also include the allocation details and the performance of PALSA (Lev) when the volatility is matched up to that of the SPY ETF, with 1.7x leverage, which is up 29.1% year-to-date. The WRE (Lev) tactical allocation is up 19.9% year-to-date with 1.6x leverage to match the SPY ETF volatility.

2. Price action analysis, weekly market summary, and market forecast

Stocks had a strong rally after March 30, 2026, and in the past 28 trading days, the S&P 500 index has gained 16.6% and has reached new, all-time highs. Below are price action statistics based on similar historical price action patterns.

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Particular disclaimer: Charts in this article may refer to price levels. We might skip updating the charts if market conditions alter price levels or affect any analysis based on them. All charts in this article are for informational purposes only. See the disclaimer for more information.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

If you found this article interesting, you may follow this blog via RSS, email, or Twitter.

Weekly Market Report: Right Tail Event was originally published on Price Action Lab

In the past eight trading days, the stock of Intel Corp. has surged 62%. This eight-standard-deviation move in a Dow Jones Industrial Average stock could represent the biggest-ever stock market pump via financial engineering. Below are a few details.

The stock of Intel Corp. (INTC) recovered from the dot-com crash about a month ago, on April 20, 2025, after experiencing a maximum drawdown of about 80% during 2008 and then, after a sluggish uptrend, falling again as much as 70% below the 2000 highs in April 2025. Below is the buy-and-hold performance since 2000, as of the close of Tuesday, May 5, 2026.

Right after joining the Dow-30 index on November 1, 1999, the stock acted as a drag on performance, with large drawdowns and a never-ending recovery period from the dot-com top. The stock was removed from the Dow-30 index on November 8, 2024, and was replaced by Nvidia. However, the damage had already affected Dow-30 performance.

The “art of the deal” found the answer to affecting a recovery in INTC stock: partial nationalization. Was this a good decision? We do not know; we are here to talk about markets and data, not to analyze political decisions that are now an integral part of Wall Street, also known as “financial engineering.” In summary, the government decided to take a 10% stake via a $11 billion investment. Under the terms of the agreement, the government agreed to purchase 433.3 million primary shares of Intel common stock. The stock of the company started recovering on the news, and recently the uptrend has accelerated.

In the past eight trading days, INTC has surged 62%, or more than eight standard deviations, or one standard deviation per day on average, based on the available sample of 8-day returns since the stock’s IPO in the 1970s. This remarkable rally in INTC stock has absorbed selling pressures in the stock market. However, please note that although the S&P 500 index total return (SPY) is up 6.4% year-to-date, 437 stocks in the index underperform it, and 280 stocks are in the red year-to-date. A few stocks, mostly in the tech sector, are doing the most work. Memories of the 2000 dot-com top keep flashing in the heads of those who have lived through more than one major bear market. But those who have only dealt with the markets after the GFC and quantitative easing argue that “this time is different.”

Disclaimer: No part of the analysis in this blog constitutes a trade recommendation. The past performance of any trading system or methodology is not necessarily indicative of future results. Please review the full disclaimer here.

Our weekly market report is now available on Substack. Click below to subscribe.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

The Relentless One-Standard Deviation Daily Market Pump was originally published on Price Action Lab

The weekly reports include tactical ensemble and strategic allocation updates, a stock market forecast, and analysis of capital markets and price action. To access the full reports, you must subscribe to Premium Articles or Weekly Premium Articles.

Weekly Market Report

1. Performance of tactical ensemble and strategic allocation
2. Price action analysis, weekly market summary, and market forecast
3. Details of tactical ensemble and strategic allocation
4. Market dynamics discussion and conclusion

Section 2 covers trends in US and foreign asset performance and an analysis of the drivers of the current market dynamic. We focus on the sustainability issues of the current market dynamic based on our quantitative analysis.

1. Performance of tactical ensemble and strategic allocation

For the week ending May 1, 2026:

• The weekly strategies tactical ensemble (WRE) gained 1.6% with equal allocation. Year-to-date: +10.6%
• The Price Action Lab strategic allocation (PALSA), which was launched late last year, gained 1.3%. Year-to-date: +11.3%.
• The SPY ETF gained 0.9%. Year-to-date: +6%

For the open positions and new signals of WRE, see Section 3. We also include the allocation details and the performance of PALSA (Lev) when the volatility is matched up to that of the SPY ETF, with 1.7x leverage, which is up 19.2% year-to-date. The WRE (Lev) tactical allocation is up 16.5% year-to-date with 1.6x leverage to match the SPY ETF volatility.

We would also like to remind new subscribers that from December 18, 2023, to December 29, 2025, the WRE tactical ensemble maintained a long position in gold (GLD ETF) with a 25% allocation. This position gained 115.3% (unleveraged).

2. Price action analysis, weekly market summary, and market forecast

Stocks had a strong rally after March 30, 2026, and in the past 23 trading days, the S&P 500 index has gained 14%, while momentum remains strong (14-day RSI > 70). We will look at a few statistics of price action, at counterintuitive ramifications, and, more importantly, at how the current market regime could influence the performance of the market going forward.

You must sign up for Premium Articles or Weekly Premium Articles in order to view the complete reports.

Particular disclaimer: Charts in this article may refer to price levels. We might not update the charts if market conditions alter price levels or affect any analysis based on them. All charts in this article are for informational purposes only. See the disclaimer for more information.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

If you found this article interesting, you may follow this blog via RSS, email, or Twitter.

Weekly Market Report: Business as Usual was originally published on Price Action Lab

This premium report included an update on the monthly rebalanced Market Signal strategies. A Market Signals subscription provides access to the entire report.

Positions and strategy performance: Thursday, April 30, 2026

Access the full report with a Market Signals subscription. Hundreds of articles are instantly available to you if you subscribe. Subscribers to Market Signals have instant access to more than 200 articles in the Premium Education section, as well as monthly signals for dynamic momentum and hybrid asset allocation.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

Disclaimer: The Weekly Signals are provided for informational purposes only and do not constitute investment advice or actionable content. We do not warrant the accuracy, completeness, fitness, or timeliness for any particular purpose of the Weekly Signals. Under no circumstances should the premium or weekly signals be treated as financial advice. The author of this website is not a registered financial adviser. Before subscribing, please read our Disclaimer and Terms and Conditions.

Copyright notice: Any unauthorized copy, reproduction, distribution, publication, display, modification, or transmission of any part of this report is strictly prohibited without prior written permission.

Market Signals for May 1, 2026 was originally published on Price Action Lab

The weekly reports include tactical ensemble and strategic allocation updates, a stock market forecast, and analysis of capital markets and price action. To access the full reports, you must subscribe to Premium Articles or Weekly Premium Articles.

Weekly Market Report

1. Performance of tactical ensemble and strategic allocation
2. Price action analysis, weekly market summary, and market forecast
3. Details of tactical ensemble and strategic allocation
4. Market dynamics discussion and conclusion

Section 2 covers trends in US and foreign asset performance and an analysis of the drivers of the current bullish dynamic.

1. Performance of tactical ensemble and strategic allocation

Tactical ensemble

For the week ending April 24, 2026, the weekly strategies ensemble (WeeklyReport-WRE) gained 1.5% with equal allocation, without leverage, as compared to a 0.5% gain for the SPY ETF. The SPY ETF is up 5% so far this year, while the ensemble has gained 8.9%.

Since January 2022:

• The SPY ETF has gained 62.4%, while the ensemble has gained 67.5%.
• The ensemble has increased by 108% with 1.6x leverage.

For open positions and new signals, see Section 3.

We would like to remind new subscribers that from December 18, 2023, to December 29, 2025, the ensemble maintained a long position in gold (GLD ETF) with a 25% allocation. This position gained 115.3% (unleveraged).

Strategic allocation

The SPY ETF gained 0.5% for the week, while the Price Action Lab strategic allocation (PALSA), which was launched late last year, gained 0.9%. Below is the performance since 2020 with annual rebalancing and without leverage.

The SPY ETF is up 5% so far this year, while the strategic allocation is up 9.8%.

In Section 3, we include the allocation details and the performance of PALSA when the volatility is matched up to that of the SPY ETF, with 1.7x leverage, which is up 16.6%.

2. Price action analysis, weekly market summary, and market forecast

Tech stocks had a strong rally after March 30, 2026, and in the past 18 trading days, the QQQ ETF has gained 18.9%, and it is now overbought for 8 days (14-day RSI > 70). Below, we will look at the statistics and also review the price action dynamics of the stock market.

3. Details of tactical ensemble and strategic allocation

Tactical ensemble (WRE): Positions and new signals

We use two long-only cross-sectional momentum strategies to generate signals for capital markets and factor ETFs.

• The ensemble (WRE) has gained 67.5% since the beginning of 2022 vs. 62.4% for the SPY ETF.
• The ensemble has gained 108% with 1.6x leverage (volatility-adjusted basis.)

We have computed the leverage using the weekly performance of the SPY ETF and the weekly report (WRE) since 2017.

Strategic allocation (PALSA)

Performance of unleveraged and leveraged allocations (annual rebalance)

The volatility of the leveraged strategic allocation is matched up to that of the SPY ETF with 1.7x leverage. Below is the performance since 2020.

After the application of leverage:

• The maximum drawdown and volatility match those of the SPY ETF.
• The annualized return increased from 13.6% to 22.3%.
• The risk-adjusted alpha rose from 4.2% to 6.1%.
• The leveraged allocation’ beta is 0.93, vs. 0.54 for the unleveraged case.

Leverage has the potential to outperform the benchmark but at comparable levels of the risk metrics and should be avoided or significantly lowered if the objective is to limit drawdowns.

Strategic allocation: ETFs and weights

You must sign up for Premium Articles or Weekly Premium Articles in order to view the complete reports.

Particular disclaimer: Charts in this article may refer to price levels. We might not update the charts if market conditions alter price levels or affect any analysis based on them. All charts in this article are for informational purposes only. See the disclaimer for more information.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

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Weekly Market Report: Where is the Dough? was originally published on Price Action Lab

The S&P 500 has gained 12.1% in 17 trading days after Warren Buffett announced that Berkshire intends to deploy capital if there is a big decline in the stock market.

We are not going to look here at theories of coincidence; the subject is too complicated. However, the reader understands the general concept: Warren Buffett announces the intention to deploy a portion of Berkshire Hathaway’s vast reserves, currently estimated at $350 billion, in the event of a market drop, and the outcome is not only the absence of the drop but also the stock market reaching new all-time highs.

It makes sense. Does it make sense to you? Is it necessary to go into the details? I don’t think so. It is better to look at the data rather than waste time studying theories of coincidence and market manipulation.

The table below shows the annual performance of Berkshire’s stock and the S&P 500 index’s total return. The last column shows the difference. If the difference is positive (blue), the stock outperformed. If the difference is negative (red), the stock underperformed during that year.

I assume everyone can spot two major times of significance: the stock outperformed during the dot-com bear market, possibly due to investing in value stocks, but has underperformed since 2019.

Specifically, since 2019, the total return of the S&P 500 index is 218.2%, while that of the Berkshire stock is 130.5%. The Sharpe ratio of the index total return in the same period is 0.87, while the Sharpe ratio of the stock is 0.60. No bueno.

Year-to-date, the stock is down 6.4%, while the S&P 500 index is up 4.2%.

Of course, the vast cash reserves can be used to support the market verbally and cause a strong rally amid one of the worst periods in geopolitics as well as politics. Coincidence?

Some scientists say the coincidences are random, while others say we should examine their causes. When it comes to price action, in this blog we adhere to the maxim, “it is what it is.” The important question is not whether Buffett offered a market put but whether there is a robust process to deal with the price action, and this process is what we believe we do effectively. Manipulation may always be present. The sun rises every day to manipulate the environment so that life is possible. Think about that. Maybe manipulation is a fundamental process.

There are endless market reports: permabulls chasing rainbows, permabears waiting for the end, amateurs using AI to impress you, and rookies who missed the last real bear market. If you want perspective from someone who’s actually been through the cycles, click below.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

If you found this article interesting, you may follow this blog via RSS, email, or Twitter.

The Buffett Put and the Theory of Coincidences was originally published on Price Action Lab

The weekly reports include tactical ensemble and strategic allocation updates, a stock market forecast, and analysis of capital markets and price action. To access the full reports, you must subscribe to Premium Articles or Weekly Premium Articles.

Weekly Market Report

1. Performance of tactical ensemble and strategic allocation
2. Price action analysis, weekly market summary, and market forecast
3. Details of tactical ensemble and strategic allocation
4. “Hidden variables” discussion and conclusion

Section 2 covers trends in US and foreign asset performance and an analysis of the drivers of the current bullish dynamic.

1. Performance of tactical ensemble and strategic allocation

Tactical ensemble

For the week ending April 17, 2026, the weekly strategies ensemble (WeeklyReport-WRE) gained 3.2% with equal allocation, without leverage, as compared to a 4.5% gain for the SPY ETF. The SPY ETF is up 4.4% so far this year, while the ensemble has gained 7.4%.

Since January 2022:

• The SPY ETF has gained 61.5%, while the ensemble has gained 65.3%.
• The ensemble has increased by 104.5% with 1.6x leverage.

For open positions and new signals, see Section 3.

We would like to remind new subscribers that from December 18, 2023, to December 29, 2025, the ensemble maintained a long position in gold (GLD ETF) with a 25% allocation. This position gained 115.3% (unleveraged).

Strategic allocation

The SPY ETF gained 4.5% during the week, while the Price Action Lab strategic allocation (PALSA), which was launched late last year, gained 3.5%. Below is the performance since 2020 with annual rebalancing and without leverage.

The SPY ETF is up 4.4% so far this year, while the strategic allocation is up 8.8%.

In Section 3, we include the allocation details and the performance of PALSA when the volatility is matched up to that of the SPY ETF, with 1.7x leverage, which is up 14.9%.

2. Price action analysis, weekly market summary, and market forecast

The S&P 500 index had its best week in a year, rising by 4.5%, and its best three-week performance in six years, surging by 11.9%. These changes caused a recovery from a 9.1% drop and set new all-time highs.

The above weekly chart shows that similar 3-sigma moves in 3 weeks (based on the available sample since 1945) have only happened 13 times in the past, or 0.31% of the time (4,148 weekly bars). Will the stock market rebound continue? Below is our analysis of a few price action patterns.

3. Details of tactical ensemble and strategic allocation

Tactical ensemble (WRE): Positions and new signals

We use two long-only cross-sectional momentum strategies to generate signals for capital markets and factor ETFs.

• The ensemble (WRE) has gained 65.3% since the beginning of 2022 vs. 61.5% for the SPY ETF.
• The ensemble has gained 100.5% with 1.6x leverage (volatility-adjusted basis.)

We have computed the leverage using the weekly performance of the SPY ETF and the weekly report (WRE) since 2017.

Strategic allocation (PALSA)

Performance of unleveraged and leveraged allocations

The volatility of the leveraged strategic allocation is matched up to that of the SPY ETF with 1.7x leverage. Below is the performance since 2020.

After the application of leverage:

• The maximum drawdown and volatility match those of the SPY ETF.
• The annualized return increased from 13.5% to 22.0%.
• The risk-adjusted alpha rose from 4.2% to 6.1%.
• The leveraged allocation’ beta is 0.93, vs. 0.54 for the unleveraged case.

Leverage has the potential to outperform the benchmark but at comparable levels of the risk metrics and should be avoided or significantly lowered if the objective is to limit drawdowns.

Strategic allocation: ETFs and weights

You must sign up for Premium Articles or Weekly Premium Articles in order to view the complete reports.

Particular disclaimer: Charts in this article may refer to price levels. We might not update the charts if market conditions alter price levels or affect any analysis based on them. All charts in this article are for informational purposes only. See the disclaimer for more information.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

If you found this article interesting, you may follow this blog via RSS, email, or Twitter.

Weekly Market Report: Hidden Variables was originally published on Price Action Lab

The weekly reports include tactical ensemble and strategic allocation updates, a stock market forecast, and analysis of capital markets and price action. To access the full reports, you must subscribe to Premium Articles or Weekly Premium Articles.

Weekly Market Report

1. Performance of tactical ensemble and strategic allocation
2. Price action analysis, weekly market summary, and market forecast
3. Details of tactical ensemble and strategic allocation
4. “Peak AI” discussion and conclusion

Section 2 covers the technical analysis of the stock market and trends in US and foreign asset performance.

1. Performance of tactical ensemble and strategic allocation

Tactical ensemble

For the week ending April 10, 2026, the weekly strategies ensemble (WeeklyReport-WRE) gained 2.7% with equal allocation, without leverage, as compared to a 3.6% gain for the SPY ETF. The SPY ETF is down 0.1% so far this year, while the ensemble has gained 4.1%.

Since January 2022:

• The SPY ETF has gained 54.5%, while the ensemble has gained 60.2%.
• The ensemble has increased by 96.3% with 1.6x leverage.

We would like to remind new subscribers that from December 18, 2023, to December 29, 2025, the ensemble maintained a long position in gold (GLD ETF) with a 25% allocation. This position gained 115.3% (unleveraged). For open positions and new signals, see Section 3.

Strategic allocation

The SPY ETF gained 3.6% during the week, while the Price Action Lab strategic allocation (PALSA), which was launched late last year, gained 2.5%. Below is the performance since 2020 with annual rebalancing and without leverage.

The SPY ETF is down 0.1% so far this year, while the strategic allocation is up 5.1%.

In Section 3, we include the allocation details and the performance of PALSA when the volatility is matched up to that of the SPY ETF, with 1.7x leverage, which is up 8.6%.

2. Price action analysis, weekly market summary, and market forecast

In the past two weeks, the S&P 500 index visited the attractor level discussed in several recent reports and then rebounded due to the combined effect of verbal interventions and hopes of a ceasefire in the Middle East. The S&P 500 index has gained 7% in the past two weeks. Will the rebound continue? Below is our updated analysis.

3. Details of tactical ensemble and strategic allocation

Tactical ensemble (WRE): Positions and new signals

We use two long-only cross-sectional momentum strategies to generate signals for capital markets and factor ETFs.

• The ensemble (WRE) has gained 60.2% since the beginning of 2022 vs. 54.5% for the SPY ETF.
• The ensemble has gained 96.3% with 1.6x leverage (volatility-adjusted basis.)

We have computed the leverage using the weekly performance of the SPY ETF and the weekly report (WRE) since 2017.

Strategic allocation (PALSA)

Performance of unleveraged and leveraged allocations

The volatility of the leveraged strategic allocation is matched up to that of the SPY ETF with 1.7x leverage. Below is the performance since 2020.

After the application of leverage:

• The maximum drawdown and volatility match those of the SPY ETF.
• The annualized return increases from 12.4% to 21.2%.
• The risk-adjusted alpha rises from 4.1% to 5.9%.
• The leveraged allocation’ beta is 0.93, vs. 0.54 for the unleveraged case.

Leverage has the potential to outperform the benchmark but at comparable levels of the risk metrics and should be avoided or significantly lowered if the objective is to limit drawdowns.

Strategic allocation: ETFs and weights

You must sign up for Premium Articles or Weekly Premium Articles in order to view the complete reports.

Particular disclaimer: Charts in this article may refer to price levels. We might not update the charts if market conditions alter price levels or affect any analysis based on them. All charts in this article are for informational purposes only. See the disclaimer for more information.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

If you found this article interesting, you may follow this blog via RSS, email, or Twitter.

Weekly Market Report: Peak AI was originally published on Price Action Lab

We provide below the combined performance of the Dynamic-3 and 0-Beta strategy bundles.

We updated the performance charts on April 9, 2026. The backtests include slippage and a commission of $0.01 per share. For more information about the bundles, click here.

There are a total of five strategies in the bundle combination. Each bundle has three strategies, but they share a common one. The strategies generate signals for liquid ETFs only. The backtest allocates 1/6 of the starting equity to each strategy, with the common strategy receiving double the allocation.

The strategies do not share equity or positions, which is often used to compound performance results. The reason we do not use compounding of this sort is that the backtest represents one time-domain path, and compounding results could drastically differ after another path, thus potentially increasing data mining bias. However, under real trading conditions, a trader could elect to partially compound when appropriate.

Equity performance

Performance metrics and comparison to SPY ETF buy and hold (R_f = 0)

Use the form below to reach out for more information. Please refer to the relevant pages of the bundles for delivery and terms in this recent article.

Disclaimer: The strategies are provided for informational purposes only and do not constitute investment advice or actionable content. We do not warrant the accuracy, completeness, fitness, or timeliness of any strategy for any particular purpose. Under no circumstances should the strategies be treated as financial advice. Please read our Disclaimer and Terms and Conditions.

Copyright notice: Any unauthorized copy, reproduction, distribution, publication, display, modification, or transmission of any part of this report is strictly prohibited without prior written permission.

Combined Performance of Two Strategy Bundles was originally published on Price Action Lab

The weekly reports include tactical ensemble and strategic allocation updates, a stock market forecast, and analysis of capital markets and price action. To access the full reports, you must subscribe to Premium Articles or Weekly Premium Articles.

Weekly Market Report

1. Performance of tactical ensemble and strategic allocation
2. Price action analysis, weekly market summary, and market forecast
3. Details of tactical ensemble and strategic allocation
4. The “Buffett put” and conclusion

Technical analysis of the stock market, a review of a pair trade, the performance of energy commodities and factors, and trends in US and foreign asset performance are all covered in Section 2.

1. Performance of tactical ensemble and strategic allocation

Tactical ensemble

For the week ending April 2, 2026, the weekly strategies ensemble (WeeklyReport-WRE) gained 1.7% with equal allocation, without leverage, as compared to a 3.4% gain for the SPY ETF. The SPY ETF is down 3.6% so far this year, while the ensemble has gained 1.4%.

Since the start of 2022, the SPY ETF has gained 49.2%, while the ensemble has gained 56.1%. The ensemble has increased by 89.7% over the same time with 1.6x leverage. We would like to remind new subscribers that from December 18, 2023, to December 29, 2025, the ensemble maintained a long position in gold (GLD ETF) with a 25% allocation. This position gained 115.3% (unleveraged). For open positions and new signals, see Section 3.

Strategic allocation

The SPY ETF gained 3.4% during the week, while the Price Action Lab strategic allocation (PALSA), which was launched late last year, gained 2.5%. Below is the performance since 2020 with annual rebalancing and without leverage.

The SPY ETF is down 3.6% so far this year, while the strategic allocation is up 2.5%. In Section 3, we include the allocation details and the performance of PALSA when the volatility is matched up to that of the SPY ETF, with 1.7x leverage, which is up 4.2%.

2. Price action analysis, weekly market summary, and market forecast

The S&P 500 index visited the attractor level discussed in several previous weekly reports, and the market rebounded mainly due to the intervention explained in the conclusion at the end of this report. Will the rebound continue? Below is our analysis.

3. Details of tactical ensemble and strategic allocation

Tactical ensemble (WRE): Positions and new signals

We use two long-only cross-sectional momentum strategies to generate signals for capital markets and factor ETFs.

The ensemble (WRE) has gained 56.1% since the beginning of 2022, compared to 49.2% for the SPY ETF. The ensemble with leverage has gained 89.7% with equal allocation and 1.6x leverage on a volatility-adjusted basis. We have computed the leverage using the weekly performance of the SPY ETF and the weekly report (WRE) since 2017.

Strategic allocation (PALSA)

Performance of unleveraged and leveraged allocations

The volatility of the leveraged strategic allocation is matched up to that of the SPY ETF with 1.7x leverage. Below is the performance since 2020.

After the application of leverage, the maximum drawdown and volatility match those of the SPY ETF in the same period, but the annualized return increases from 12.4% to 21.2%, resulting in the risk-adjusted alpha rising from 4% to 5.8%. By design, the leveraged allocation has a high beta, at 0.93, as compared to 0.54 for the unleveraged case. Leverage has the potential to outperform the benchmark but at comparable levels of the risk metrics and should be avoided or significantly lowered if the objective is to limit drawdowns.

Strategic allocation: ETFs and weights

You must sign up for Premium Articles or Weekly Premium Articles in order to view the complete reports.

Particular disclaimer: Charts in this article may refer to price levels. We might not update the charts if market conditions alter price levels or affect any analysis based on them. All charts in this article are for informational purposes only. See the disclaimer for more information.

Disclaimer: These articles are provided for informational purposes only and should not be considered investment advice or actionable content. We do not guarantee the articles’ accuracy, completeness, fitness, or timeliness for any specific purpose. You should never treat the articles as financial advice. The author is not a registered financial advisor; thus, before subscribing, please read our Disclaimer and Terms and Conditions.

Charting and backtesting program: Amibroker. Data provider: Norgate Data

If you found this article interesting, you may follow this blog via RSS, email, or Twitter.

Weekly Market Report: The Buffett Put was originally published on Price Action Lab

The Dynamic-3 and 0-Beta strategy bundles’ updated performance is provided below.

Click here for the latest article, which includes the combined bundle performance.

The performance charts were updated on April 3, 2026, and they include slippage and a commission of $0.01 per share.

Dynamic-3 Bundle

The Sharpe ratio is 1.45. Since 2010, there has only been one negative year, which was -1.2% in 2022. The maximum drawdown is 11.3%, and the CAGR is 11.7%. The beta is 0.18. Click here for more details. 

0-Beta Bundle

The beta is 0.03. The Sharpe ratio is 1.11. Since 2010, there haven’t been any losing years. The maximum drawdown is roughly 11%, and the CAGR is 9.2%. Click here for more details.

Use the form below to get in touch with us for more information and an invoice. Please refer to the relevant pages of the bundles for delivery and terms.

Disclaimer: The strategies are provided for informational purposes only and do not constitute investment advice or actionable content. We do not warrant the accuracy, completeness, fitness, or timeliness of any strategy for any particular purpose. Under no circumstances should the strategies be treated as financial advice. Please read our Disclaimer and Terms and Conditions.

Copyright notice: Any unauthorized copy, reproduction, distribution, publication, display, modification, or transmission of any part of this report is strictly prohibited without prior written permission.

Update: Two Strategy Bundles was originally published on Price Action Lab