Monday Insights
The Pullback Everyone’s Overreacting To — And the Setup No One’s Paying Attention To
Every Fed week looks the same if you’ve traded enough cycles:
Short-term noise, crowded narratives, and a lot of investors misreading perfectly normal market behavior as something dangerous.
This is not danger.
This is positioning.
Today’s tape gave us three signals — and all three line up with the same outcome: weakness into the FOMC, strength after.
Let’s walk through it.
1. Apple weakness actually matters — but not the way people think
Apple rolled over this morning, and normally I’d ignore a half-percent pullback. But when a name that represents more than 15 percent of the entire S&P 500 shows a minor short-term peak, it moves the whole index.
AAPL looks set for 2–3 days of further weakness, with the first real support zone around $272, and a deeper technical target near $266.
This isn’t bearish — it’s a controlled unwind before the next run.
The average investor sees weakness and panics.
Professionals see weakness and prepare capital.
2. Tech leadership is narrowing — exactly what a transition phase looks like
Yes, tech is green today. But look beneath the surface.
Leadership isn’t coming from the usual suspects.
It’s JBL, ON, GLW, MPWR, MU — all up more than +2.5 percent while the megacaps take a breather.
This is the clearest sign of digestion, not deterioration.
When the generals rest, the lieutenants take the hill.
NVIDIA still looks soft, Apple is unwinding, and QQQ is getting tugged by both. That’s how rotation works before new highs — the baton changes hands.
3. Yields broke out this morning — and everyone freaked out for no reason
Rates across the curve pushed above multi-month trendlines, and suddenly every armchair macro tourist is screaming that the Fed is about to ruin everything.
Relax.
If the Fed cuts 25 bps this week — which they will — this breakout in yields is historically short-lived.
The long-end overshot.
Equities flinched.
Treasuries backed up.
That’s the shakeout. Not the trend.
Once the dust settles, this move likely reverses lower, offering a clean dip-buy for Treasury investors and removing a big headwind for equities.
4. SPX is doing exactly what a market should into a major event
SPX reversed early and drifted lower — maybe 0.20 percent.
This is textbook pre-FOMC compression.
My short-term expectation: a slide into 6754 or even 6710 before the next leg higher.
Nothing here signals trend failure.
Nothing here threatens the January setup.
It’s consolidation — and it’s healthy.
The only thing that would change my view is a decisive reclaim of this morning’s reversal.
If that doesn’t happen today, we chop lower and reset.
Simple.
5. The bigger picture — January is still the moment people aren’t ready for
Unless something wildly unexpected comes out of the Fed this week, this pullback is setting up the exact thing we want:
A coiled market heading into a liquidity-infused window.
Volatility has been compressing for weeks.
Compression always leads to expansion.
This is the expansion phase approaching — not the unwind.
Stay patient.
Stay deliberate.
And if you’re scaling into positions ahead of the buy zones, do it with a long-term lens and keep money ready for the levels that matter.
Alpha gets printed in moments like this — before anyone knows what they’re looking at.
— Connor
Alpha Before It Prints
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