As we enter the first full week of March, markets find themselves at a fascinating crossroads. The S&P 500 has been stuck in neutral, consolidating between 6,800 and 7,000 for months now. In fact, the index has closed within 2.5% of its 50-day moving average for an unprecedented 65 consecutive sessions. Yet beneath this calm surface, powerful currents are pulling in opposite directions.

On one hand, we have Nvidia delivering record quarterly results with $68.1 billion in revenue and nearly $20 billion more in free cash flow than last year. On the other, fears are spreading about AI's potential to disrupt industries and displace workers. This anxiety manifested dramatically when IBM stock plunged over 10% after Anthropic announced Claude could streamline COBOL code.

Which narrative will win? Will AI drive the largest productivity expansion in modern history, or will it trigger the dystopian scenario that some analysts fear? And perhaps more immediately, what happens when investor sentiment reaches its lowest point since Liberation Day while the market stubbornly holds its support levels?

Meanwhile, geopolitical tensions are heating up again. The U.S. and Iran have resumed nuclear talks, with President Trump ordering a military buildup in the region. Oil prices have spiked as traders price in potential supply disruptions through the Strait of Hormuz. Gold is surging. Treasury yields are collapsing. This week's employment numbers will arrive Friday, and they could be the catalyst that finally breaks the market's range.

This week, we explore these competing forces and what they mean for your portfolio. Let's dive in.

The S&P 500 closed the week 0.46% lower at 6,879 as investors weighed record earnings from Nvidia against growing fears about artificial intelligence's impact on specific industries and the broader economy. The anxiety began when Anthropic announced that Claude could streamline legacy COBOL code, sending IBM stock plummeting over 10% in its worst daily drop since October 2000.

This development sparked a broader debate about AI's economic implications. The widely circulated Citrini report painted a dystopian scenario where AI triggers a widespread market crash through job replacement, automation, and downward price pressures. However, we believe the most underpriced possibility today is not dystopia, but abundance. AI may compress rents, reduce friction, and restructure labor markets, but it could also deliver the largest real productivity expansion in modern history. Even if AI reduces wages and displaces workers, if the efficiency gains drive prices lower faster than wages fall, it could result in a net increase in purchasing power for consumers.

On the technical front, the S&P 500 has consolidated between 6,800 and 7,000 for months. The index has now closed within 2.5% of its 50-day moving average for 65 consecutive sessions, the longest streak since 2018. We believe once this consolidation concludes, momentum will resume in the direction of the broader trend, which points higher.

Multiple tests of 6,800 to 6,830 support occurred last week, all of which held. This is strong evidence that the bottom end of the range is solid and another move toward 7,000 appears likely. The daily top and bottom Bollinger Bands have remained fairly flat at 6,994 and 6,795 respectively, while the daily RSI has begun trading in an upward divergent direction. This includes the most recent test of uptrend support at approximately 45 on February 27th, which opens the door for a move back into the top end of the S&P 500's range.

Nvidia delivered exceptional fourth quarter results that exceeded all expectations. The company reported Q4 2025 earnings per share of $1.62, above expectations of $1.53, on revenue of $68.1 billion, surpassing the $66.2 billion consensus. Total revenue for the quarter climbed 73% from $39.3 billion a year earlier. Data center revenue came in at $62.3 billion, ahead of expectations for $60.7 billion, and free cash flow jumped almost $20 billion compared to last year.

Perhaps most impressive was the guidance, which came in far stronger than expected. Management guided Q1 2026 revenue of $78 billion, plus or minus 2%, compared to expectations of $72.6 billion. Despite these outstanding results, the stock initially surged in after-hours trading before turning sharply lower, shedding nearly 13% from its post-earnings high to Friday's close. We view this as a typical sell-the-news situation, particularly as $200 resistance was rejected. However, the stock is now back near the bottom end of its recent range, with the daily RSI at approximately 40 support and the daily bottom Bollinger Band at $173.99. We believe dip buyers will begin stepping back into this name in the coming weeks.

Broader earnings data for February showed continued strength. Of companies reporting, 67.3% beat EPS expectations and 69.9% exceeded revenue forecasts. These beat rates remain well above historical averages of 63.1% for earnings and 62.8% for revenue. Guidance was also constructive, with 56.3% of companies providing positive guidance compared to just 41.8% normally. This suggests companies remain confident about their outlook despite growing economic uncertainty.

The main macroeconomic focus this week will be Friday's February employment report. Last month, payrolls improved to their strongest level since April, adding 130,000 new jobs. However, that report included one of the worst downward revisions to the jobs data on record, resulting in job losses of 897,000 in August 2024, worse than the 515,000 in June 2024.

Employment index data has been surprisingly flat for being at such a low level. In more than 20 years, this is the first time we have seen the employment index this low while still positive for two months in a row. There have been only 10 previous months when the index was this low while remaining positive. On average, the number of new jobs fell by 17,000 from the previous month. That would actually be an improvement relative to consensus estimates. The consensus expects February payrolls to show 60,000 new jobs, down from January's 130,000.

These numbers are not bearish expectations, but even with an upside surprise, declining job growth is unlikely to make investors more optimistic about the economy or the stock market. The employment data will be particularly important given the Fed's continued focus on labor market conditions when making policy decisions.

Investor sentiment has weakened to its lowest level since shortly after Liberation Day last year. Since Liberation Day came and went, sentiment has been mostly neutral to slightly bullish, and since stocks go higher more often than they go lower, sentiment was statistically positive for stocks. Now, however, sentiment has declined significantly.

At current sentiment levels, the S&P 500 has been higher three months later 73.8% of the time and has been higher by an average of 3.4%. Those numbers improve when factoring in the decline in sentiment over the past 13 weeks. You are indeed much better off buying stocks when sentiment is bearish than when sentiment is bullish, at least when it comes to the overall stock market.

Yet sentiment is trending lower, and it is not yet at a point that has typically been an extreme level where it begins to improve. This creates an interesting dynamic where support is holding and the market could bounce before sentiment reaches an extreme, or sentiment could fall further until the market finally breaks through support at 6,795 or $677 for the S&P 500 SPDR.

The technical setup for the S&P 500 remains constructive following the recent consolidation. Markets have digested record earnings from Nvidia alongside growing debate around the economic impact of artificial intelligence. The S&P 500 has held its consolidation range between 6,800 and 7,000, with multiple tests of 6,800 to 6,830 support holding firm. The daily RSI bounced off approximately 45 uptrend support, which historically has provided a good entry point.

We believe the AI Revolution points to higher asset prices going forward, with the S&P 500 still on the cusp of fresh record highs. The clear trend of elevated inflation throughout all inflation metrics in the U.S. economy also supports owning equities. Friday's PPI inflation data for January showed headline PPI inflation at 2.9%, above expectations of 2.6%, and core PPI inflation at 3.6%, above expectations of 3.0%.

Looking at how this could play out, we think declining sentiment will eventually break the recent support level for the S&P 500 at 6,795. Then, the market will sell off until sentiment reaches an extreme. However, it also feels possible that sentiment will fall while support holds, and as the S&P 500 bounces, there will no longer be more sellers than buyers, and the index will finally push higher to new highs and a more sustained rally after six months of trading sideways.

For now, support is holding, and market breadth remains strong despite the weakness in sentiment. This keeps us positioned more on the long side ahead of key earnings releases this week. We expect a bullish outcome for the S&P 500 with a target of 7,100 and a stop at 6,600.

Several important economic data points will be released this week. Tuesday brings February ISM Manufacturing data. Wednesday features February ADP Employment and ISM Services data. Thursday delivers Q4 Productivity and Initial Jobless Claims. The week culminates Friday with the critical February Employment report and January Retail Sales data.

The employment report will be particularly important for market direction. The consensus estimate for February is 60,000 new jobs, down from January's 130,000. These numbers are not bearish expectations, but even with an upside surprise, declining job growth is unlikely to get investors more optimistic about the economy or the stock market. The ongoing weakness in employment data has been a key factor influencing market sentiment.

Many companies are scheduled to report earnings this week, with much of the focus on retail and consumer discretionary stocks. Expectations are mixed, with seasonality creating additional uncertainty. However, backing out auto sales and gasoline, the numbers are expected to be much stronger. What really matters is what companies are seeing in the coming quarters. So far, most retailers have seen little change in the U.S. consumer, though commentary has been more mixed.

Recent reports paint a nuanced picture. Some retailers noted softness in December, particularly among 25 to 34-year-old consumers, though older progressive customers remained resilient. Weather also played a significant role, with historic winter storms and cold weather to start the year impacting store traffic and sales. However, sales picked up again after the storms passed, suggesting the weakness was temporary rather than structural.

Outside of winter storm impacts, the consumer story has been mostly consistent for the past year. The consumer has remained resilient across different income levels. For households earning below $50,000, wallets remain stretched with many managing spending paycheck to paycheck. However, even these households are emphasizing convenience nearly as much as price. For households making over $100,000, spending continues to be resilient, with many retailers seeing the majority of their share gains coming from higher-income households.

An important tailwind for consumer spending in the coming quarters comes from the One Big Beautiful Bill Act. Tax refunds are up 11% so far this year, and overall tax relief has increased 18% year over year. For those making between $50,000 and $100,000, this means a modest increase in tax returns and about $75 per month added to paychecks. Those making over $100,000 are seeing an estimated extra $2,000 in tax returns and $120 more per month in take-home pay. This should provide a stimulative backdrop for the first half of the year.

While there might be softness in some numbers due to winter storms, most companies should still point to a resilient consumer with tailwinds for the coming quarters. The consumer clearly went shopping during the holiday season, and underlying demand remains healthy despite headlines suggesting the consumer is under pressure.

WTI crude for April 2026 delivery closed the week 1.48% higher at $67.36 per barrel as traders remained on alert for potential supply disruptions after the United States and Iran extended nuclear talks. The United States and Iran held indirect talks in Geneva on Thursday after President Trump ordered a military buildup in the region. The two countries then announced plans to resume negotiations with technical-level discussions scheduled next week in Vienna.

On Friday, President Trump said he would "love not to" attack Iran, "but sometimes you have to." At this point, geopolitical risk premiums of $8 to $10 per barrel have built into oil prices on fears that a conflict will disrupt Middle East supply through the Strait of Hormuz, where about 20% of global oil supply passes. However, we maintain our view that a prolonged conflict with Iran is highly unlikely. The Trump Administration has been adamant about being the "peace presidency" and obtaining lower energy prices, both of which are inconsistent with a prolonged war between the U.S. and Iran.

Price action has been extremely choppy in commodity markets across the board due to ongoing headlines between the U.S. and Iran. On February 27th, WTI crude rallied to a high of $67.83, briefly crossing above its daily top Bollinger Band at $67.55, and the daily RSI moved directly into approximately 63 downtrend resistance. Meanwhile, the daily bottom Bollinger Band began shifting lower for the first time since late January, now at $61.74, and prices have remained largely rangebound between $65 and $67.

As we look ahead, we believe oil prices will fall in the case of either a U.S. deal with Iran or if the U.S. conducts a one-time strike on Iran, similar to what we saw in June. Geopolitical tensions between the U.S. and Iran have added a sizable risk premium to oil prices, but negotiations continue. The $67 to $68 resistance zone has proven to be strong, with WTI crude briefly crossing above its daily top Bollinger Band at $67.55 before pulling back.

We continue to believe that upside in oil prices will be limited. The Trump Administration's focus on lower energy prices creates an implicit ceiling on crude oil prices. We expect oil prices to fall whether we get a deal with Iran or if the U.S. conducts a limited strike. Therefore, we remain bearish on WTI crude with a $60 target and $70 stop.

Natural gas prices for April 2026 delivery ended the week 9.83% lower at $2.85 as the market continued to drift downward ahead of the start of the spring shoulder season, where demand is expected to fall on warmer weather and supply is poised to rise due to increased production. The market steadily drifted lower throughout the entirety of last week, with Monday's gap higher failing to attract enough buyers to break out over the 50-day moving average. This led to a steep sell-off and the ultimate drop below the $2.90 level.

According to the EIA's latest report, natural gas inventories fell 52 Bcf in the week ending February 20th, which was a weaker than expected reading. Inventories are now 141 Bcf higher than last year at this time and 7 Bcf below the five-year average of 2,025 Bcf. The market has quieted down after a rapid move lower from the January 2025 cold spell.

The technical picture shows that indicators have begun to normalize following the volatility seen in late January. The daily top and bottom Bollinger Bands have converged at $3.85 and $2.52 respectively. Last week saw an early move higher on February 23rd into a high of $3.25, which was quickly reversed with a drop back below $3. By February 26th, natural gas prices hit a new low of the week at $2.78, and the daily RSI extended its decline below approximately 45 support.

We believe the short trade is beginning to look crowded, with prices having declined over 60% from their highs seen in January. For now, we believe remaining neutral and sidelined is a smart move until price action begins to widen again. We are neither bullish nor bearish on natural gas at current levels.

Gold prices for April 2026 delivery closed the week 3.22% higher at $5,280 per ounce, ending near a one-month high on Friday and posting a seventh straight month of gains. The advance was supported by geopolitical tensions after the United States and Iran extended nuclear talks and general uncertainty in the market. Gold also benefited from data on Friday showing that producer prices increased more than expected in January, suggesting inflation could pick up in the months ahead.

Physical gold demand remained strong. China's net gold imports via Hong Kong in January rose by 68.7% from December, according to Hong Kong Census and Statistics Department data. On the other side, the U.S. Dollar Index extended its recent rally, now nearing 98.00, which typically pressures gold prices. Additionally, a large geopolitical risk premium has now been fully priced into gold markets, leaving room for disappointment for short-term gold bulls in our view.

From a technical perspective, gold prices pushed above the $5,145 previous lower high from February 11th and broke above $5,250 resistance last week. This came with a move above 60 in the daily RSI and a shift lower in the daily top Bollinger Band to $5,334. Now, prices are trading directly at downtrend resistance stemming from the all-time high on January 29th. We believe this will provide significant pressure on prices in the $5,280 to $5,400 technical zone.

As we look ahead, we see a move into long-term upward trending channel support as the healthy next step for the technical backdrop, now at $4,900. This would then open the door for a drop into $4,800 support where a higher low can form in the middle of the long-term channel. In the case of a deal with Iran, we believe a 5% or greater risk premium will be priced out almost instantly.

While the fundamental case for gold ownership remains robust across multiple dimensions, including central bank demand at historically elevated levels, geopolitical tensions globally, and real interest rates remaining in negative territory, we believe the short-term picture looks overbought. Gold is now testing downtrend resistance near the $5,280 to $5,400 zone while the daily RSI is nearing 70 and a large geopolitical risk premium is priced in.

The recent strength in the U.S. Dollar, while creating near-term pressure on gold prices, appears unsustainable from a technical perspective. The Dollar Index has reached a daily RSI of approximately 67 and crossed above its daily top Bollinger Band at 99.67, indicating overbought conditions. Without sufficient fundamental support for a sustained Dollar rally, we expect this strength to prove temporary. Therefore, we remain bearish on gold with a $4,800 target and $5,400 stop.

The yield on the ten-year note closed the week 15 basis points lower at 3.95%, ending below 4% for the first time since November 28th. Even as U.S. PPI inflation data came in far hotter than expected on Friday, the drop in yields simply kept going. The latest data showed core wholesale prices, stripping out food and energy, rose 0.8% in January, according to the Bureau of Labor Statistics, far above the 0.3% increase expected.

It seems that bonds have gained a bid based on AI uncertainty, more so than geopolitical tensions. Investors are growing increasingly cautious about the economic implications of a rapid surge in the efficiency and accuracy of AI models. Rising fears that AI will lead to large job losses, eventually contributing to economic stagflation, in which rising prices are coupled with slowing economic growth, are hurting economic sentiment.

On the technical front, price action in the iShares 20+ Year Treasury Bond ETF has developed exactly as expected over the last few weeks. On February 20th, TLT fell into $89 uptrend support, which held precisely and officially formed the most recent higher low last week. This came with a bounce off of approximately 60 support in the daily RSI and now a sharp shift higher in the daily top Bollinger Band to $91.38.

Price action was able to push above its previous higher high of $90.12 from February 17th and the $90.64 high from November 26th. We believe this now opens the door for a push into the $92.19 high recorded on October 21st and ultimately our $93 target. The fundamental backdrop is finally beginning to gain some traction and we believe TLT has more room to run. Therefore, we remain bullish on TLT with a $93 target and $85 stop.

CrowdStrike represents a compelling opportunity in the cybersecurity space. The company reports fourth quarter fiscal 2026 earnings on Tuesday, March 3rd after market close. Consensus expectations call for earnings per share of $1.10 on revenue of $1.30 billion. The stock has been under pressure recently as cybersecurity stocks have gotten beaten up on AI disruption fears. However, CrowdStrike continues to see strong underlying trends and has tracked well during the quarter.

The most important driver of growth is Falcon Flex, CrowdStrike's flexible consumption model. Flex is increasingly resonating with customers because it encourages them to consolidate spending across modules under an all-you-can-eat structure. This tends to pull forward larger deal sizes and broaden adoption across the platform. As budgets get spent down in Q4, consumption-style models can benefit from budget flush behavior, which can show up as upside in net new annual recurring revenue.

If Flex continues to gain share in the mix, it can become a structural tailwind for both ARR growth and the durability of the story, much like commitment-based models have helped cloud vendors expand wallet share over time. The strong data checks during the quarter have resulted in a favorable setup heading into the earnings report.

The stock pushed above $400 shortly after Liberation Day, retested $400 around earnings in August, and has now fallen below $400. From a technical perspective, $400 should be viewed as resistance until proven otherwise. If the stock gets back above $400 and holds, the setup would then be in place for a continued move higher.

CrowdStrike currently trades with favorable setup characteristics for those willing to position ahead of earnings. The daily technical indicators show room for upside momentum. The stock is now back near the bottom end of its recent range, with the daily RSI at approximately 40 support and the daily bottom Bollinger Band at $382. We believe dip buyers will look to step into this name if it can demonstrate strength following the earnings report.

However, there are important considerations to keep in mind. Sentiment has fallen to its lowest level in years, reaching levels that have historically preceded gap-downs rather than gap-ups. Since the stock pushed above $400 in April, sentiment has been falling and recently reached its lowest level this close to earnings in years. At these sentiment levels, the stock has typically faced headwinds even after positive results.

Low sentiment combined with strong results would typically create a favorable grade setup, suggesting potential for outperformance following earnings, particularly if the stock gaps lower initially. However, historically when sentiment has been this low going into earnings, the stock has not only gapped lower most of the time, but has also continued to drift lower over the subsequent week.

Given the combination of strong fundamental momentum from Falcon Flex adoption, positive industry data checks, but concerning sentiment levels, we view CrowdStrike as a name to watch closely around the $400 level. A decisive break and hold above $400 following earnings would be the signal that the setup is in place for a continued move higher. Until shown otherwise, $400 remains the key resistance level to monitor.

We remain modestly net long in the overall stock market this week. This positioning reflects our constructive outlook for equities in the current environment despite the challenges posed by declining sentiment and geopolitical uncertainty. We believe the combination of strong corporate earnings, ongoing AI infrastructure investment, and potential for a sentiment rebound supports maintaining exposure to risk assets.

Our equity positioning has not changed from last week. The recent technical consolidation in the market appears healthy after months of rangebound trading. We view the multiple successful tests of support at 6,800 as evidence that the bottom end of the range is solid. As long as the fundamental thesis remains intact based on corporate earnings and economic data, we are comfortable maintaining our current exposure levels.

For the S&P 500, we maintain a bullish stance with a target of 7,100 and a stop at 6,600. The recent pullback to 6,800 and successful defense of this level has created what we view as a favorable risk-reward setup. Key technical support levels are holding and momentum indicators have reset to healthier levels after the recent consolidation. The S&P 500 has closed within 2.5% of its 50-day moving average for 65 consecutive sessions, the longest streak since 2018. We believe once this consolidation concludes, momentum will resume in the direction of the broader trend, which points higher.

In commodities, we remain bearish on WTI crude oil with a $60 target and $70 stop. Geopolitical tensions between the U.S. and Iran have added a sizable risk premium to oil prices, but we believe upside will remain limited. The Trump Administration's focus on lower energy prices creates an implicit ceiling on crude. We expect oil prices to fall whether we get a deal with Iran or if the U.S. conducts a limited strike. For natural gas, we are neutral at current levels after the sharp decline from January highs. The short trade appears crowded with prices down over 60%, so we prefer to remain sidelined.

We maintain a bearish stance on gold with a $4,800 target and $5,400 stop. While the long-term fundamental case for gold remains robust, we view the short-term picture as overbought. Gold is now testing downtrend resistance near the $5,280 to $5,400 zone while the daily RSI is nearing 70 and a large geopolitical risk premium is priced in. In the case of a deal with Iran, we believe a 5% or greater risk premium will be priced out almost instantly.

For fixed income, we are bullish on the iShares 20+ Year Treasury Bond ETF with a $93 target and $85 stop. Despite hotter than expected PPI inflation data, bonds have gained a bid based on AI uncertainty and economic concerns. The technical picture has improved significantly, with TLT forming a higher low at $89 and breaking above previous resistance levels. We believe the fundamental backdrop of economic uncertainty supports further gains in Treasury prices.

As we look to the week ahead, several key factors will influence market direction. Friday's employment report for February will be closely watched, with consensus expecting 60,000 new jobs compared to January's 130,000. While these are not bearish expectations, declining job growth is unlikely to boost investor confidence. The ongoing weakness in employment data combined with falling sentiment creates an interesting dynamic.

We see two potential paths forward. In one scenario, declining sentiment finally breaks the recent support level for the S&P 500 at 6,795, triggering a selloff until sentiment reaches an extreme. In the alternative scenario, sentiment falls while support holds, and as the S&P 500 bounces, there are no longer more sellers than buyers, allowing the index to finally push higher to new highs and a more sustained rally after six months of sideways trading.

The debate around AI's economic impact will continue to play out in the background. We maintain our view that the most underpriced possibility is not dystopia, but abundance. AI may compress rents, reduce friction, and restructure labor markets, but it could also deliver the largest real productivity expansion in modern history. Even if AI reduces wages and displaces workers, if efficiency gains drive prices lower faster than wages fall, it could result in a net increase in purchasing power for consumers.

On the geopolitical front, developments with Iran will be important for commodity markets. Any progress toward a deal or signs of de-escalation would likely lead to a sharp drop in the geopolitical risk premium currently priced into both oil and gold. Conversely, any escalation would provide temporary support for these assets, though we believe the Trump Administration's focus on being the peace presidency makes a prolonged conflict unlikely.

Overall, our positioning reflects confidence that the equity market can work through the current period of consolidation and uncertainty. We remain focused on strong corporate fundamentals, ongoing AI infrastructure investment, and constructive technical setups following recent consolidation. The key is to remain disciplined with our targets and stops while staying flexible enough to adjust as new information becomes available.

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^{This report represents analysis and opinion rather than investment advice or recommendations. All views expressed reflect our current thinking and may change as new information becomes available. Past performance does not guarantee future results.}

^{Readers should conduct their own research and consult with qualified financial advisors before making investment decisions. Market conditions can change rapidly, and positions discussed may not be suitable for all investors depending on individual circumstances, risk tolerance, and investment objectives.}

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