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As a quick note, we are traveling through Thursday. Both this weekend’s report and our midweek update will be shorter than usual given time constraints. We appreciate your understanding.

Introduction

April didn’t just close—it exploded higher.

Nearly every major index posted double-digit gains to finish the month. More importantly, this wasn’t a move that caught us off guard. Since our 3/22 report, we’ve been clear: buy the fear.

We didn’t just make the call—we stayed with it. As the market climbed, we consistently laid out the case to remain invested and add to long exposure, reinforcing the view with multiple layers of confirmation along the way.

Much of the market’s advance has been concentrated in a narrow segment of leadership—something we highlighted in our last report.

The move has been driven primarily by Technology, which has effectively been steering the market higher. That leadership makes sense in this environment. Relative to other sectors, Tech remains the most insulated from oil-driven pressures, allowing it to outperform while more macro-sensitive areas lag.

That leadership has been fueled primarily by the AI infrastructure trade—most notably, semiconductors, which have been at the center of the move and continue to act as the market’s primary engine.

Strong earnings from key reporters have largely overwhelmed concerns around a potential re-escalation in the Iran conflict and persistently high oil prices. In doing so, the market has defied the skeptics—many of whom have been forced to chase performance higher.

In our last report, we flagged the potential for a pause, as breadth was beginning to deteriorate under the weight of triple-digit oil. That concern proved short-lived. Signs of flexibility out of Iran shifted the narrative, and oil abruptly reversed course—falling 8–9% into the weekend. That move provided immediate relief to equities, particularly those most sensitive to rising input costs that had been under pressure from the relentless climb in crude.

The Russell 2000 Index (RTY), which arguably carries the greatest exposure to elevated input costs, responded accordingly. The reversal in oil reinvigorated the index—halting the prior slide and propelling it to fresh all-time highs by Friday.

This is precisely why we continue to stress selectivity with new capital. Large portions of the market remain hostage to oil, and until that dynamic fully resolves, broad participation will stay uneven.

The good news is that the market is showing a clear bias: any incremental positive development on the SOH front is being rewarded with higher prices, particularly as earnings continue to come through constructively. With stronger results being validated by price action, confidence is building, and capital is gradually being redeployed back into equities.

The bullish tone has pulled retail traders back into the game after largely stepping aside in the wake of the conflict. According to Scott Rubner at Citadel, individual investor activity has surged to the 94th percentile relative to the past five years—fueled by tax refunds and improved liquidity.

This matters. Retail has been a key pillar behind the market’s resilience in recent years, and their re-engagement adds incremental fuel to the upside. When this cohort leans in, it tends to amplify momentum—especially in an already trending tape.

The question now becomes: does the market begin to respect a weakening seasonal backdrop and digest recent gains, or does it continue to press higher—leaving underexposed investors chasing? The old “Sell in May” narrative is back on the table.

Let’s get into the charts.