The indexes look like a masterpiece, but the underlying canvas is tearing. SPY gains +1.78% and QQQ flies +3.38%, heavily skewed by chip monster $SNDK surging +14.5%.
Let's apply the base rate instead of staring at the green candles. Today, 166 large-cap stocks posted moves of 3% or more. Out of over 45,000 identical historical instances in our database since 2019, these high-flying momentum gainers closed red 53% of the time in the following days.
Historically, more than half of these aggressive gap-ups lose their steam within 48 hours. Chasing a narrow, chip-fueled rally when macro fundamentals are actively deteriorating is how you get drafted as exit liquidity.