Stock Market Today With IBD Sep 18, 2026 40m 22m saved
The Nasdaq composite closed up 0.4% on Friday, and the strongest thing the show could say about it was that it closed up at all.
The week's problem was not the direction of any single day. It was that the index has produced several apparent turning points since the Federal Reserve raised rates and followed none of them through. This session did follow through, and that was the entire case for it.
"We have seen so many times where there's what looks to be a critical turning point in the market. And the unfortunate part is we just don't get any follow-up strength."
Investor's Business Daily's method is to buy where the strength is, measured on daily and weekly charts rather than on forecasts, and the show runs through the indexes, the sectors and three individual names every afternoon.
The full episode is covered here so you can skip it. 40 minutes of audio, 18 minutes of reading.
Here are the 15 charts that matter.
Key Takeaways
The Nasdaq closed up 0.4%, and the show's whole argument for the day was that it followed through rather than faded
The Nasdaq undercut its 10-week moving average during the week and closed the week back above it
Leadership has flipped back to the Magnificent 7, with the equal-weight S&P 500 no longer carrying the index
The S&P 500 is stuck between its 21-day and 50-day lines, with almost no gap between them
Junk bond prices are the show's new signal for whether small caps can work
Chips gained 2.2% and retook a falling 50-day line while software fell 1.4%, which is the split that has held all week
Chips carry about twice software's weight in the Nasdaq, so the two moving together is what would change the index
The Bitcoin ETF rose 6.3% on an SEC exemption permitting tokenized US stocks to trade on a blockchain ledger
Robinhood rose 9%, and the show's model portfolio cut back to about 60% invested into the weekend
A shipping fund is up another 20% on the week, which the show flagged as a reason to be careful rather than a reason to buy
1. A Day That Was Simply Up
The Nasdaq composite rose 0.4% on the day. The S&P 500 added about 0.2%. Small caps fell about half a percent on Friday, with IWM down about 1.7% for the week. The Dow lost about 0.2% on Friday and 1.9% on the week.
The bar for a good day was low, and it cleared it
And the best thing I can say about the action today was it was up right.
A host
The pattern it broke was the one that has been failing
We have seen so many times where there's what looks to be a critical turning point in the market. And the unfortunate part is we just don't get any follow-up strength.
A host
Holding above the previous day's high mattered more than the size of the gain, because that is the specific thing the index had failed at repeatedly.
Holding the gain into the close was the win
So, the fact that we held the gains through the close was a positive.
A host
2. The Nasdaq's Good Shakeout
The technical story of the week was a break below a marked low at 25,910 on Wednesday, the day of the volatile reaction to the rate decision, followed by a recovery.
The break below the marked low reversed
We did get a little shakeout below that level. Closed essentially flat and this was on that very wild intraday Fed reaction day and then we got the big day two reaction that we liked clearing a trend line. So that was a good shakeout.
A host
The weekly chart showed the same shape on a longer scale: an undercut of the 10-week moving average line and a close back above it.
Where the week closed is the part that counts
You undercut that 10-week moving average line, but look where we closed.
A host
One host's argument for taking the shakeout seriously was that the market has a limited supply of them.
A market can only fake out so many times
You got to figure that after a number of times where it's kind of faked one way and then gone the other, faked one way and then gone the other, it only has so many of those in it, right?
A host
He was careful to add that nothing guarantees this was the last one.
3. Not Everything Rows Together
The complaint against the tape is that the strength is concentrated and everything else is going nowhere.
The rowers are pulling at different speeds
There's a lot of action that is very very targeted in certain areas whereas a lot of other areas are kind of falling and just not showing the follow-up strength.
A host
Which leaves the method with one place to be
because our whole methodology is about going where the strength is and right now that's in tech
A host
The next thing the show wants from the index is a move out of the sideways range with more names participating, rather than another single strong session.
4. The S&P's No Man's Land
The S&P 500 is in a worse technical position than the Nasdaq. Its low did not clear the 21-day line, and the gap between the 21-day and the 50-day is unusually narrow.
It is not weak enough to fail and not strong enough to break out
It's kind of right there in no man's land. Not weak enough to be below the 50-day, but not strong enough to really get above that 21-day moving average line.
A host
Which makes small moves decisive
There just isn't much room between that 21 and 50day. So you could see this you know with just very small movements go up or down below those moving average lines very easily.
A host
The test he wants is the low, not the close
But again, that 21day moving average line, I'm going to want to see not just the close get above that, but also the low get above that line.
A host
The other host had expected the pullback to reach the 50-day line and beyond after the index lost the 21-day a couple of weeks ago, and reads pullbacks of this kind as opportunities, with the caveat that in real time there is no way to tell a base from a way station.
5. Two Ways To Pull Back
The objection the show hears is that the index has barely corrected. The answer offered was that a correction has two dimensions.
A pullback can be measured in time as well as price
You can either have it that correction in terms of its distance from its highs, but also kind of distance in time, if you will.
A host
This one has worn people out rather than scared them
As time kind of progresses, it that's one of those things where you either wear them out or scare them out. And this has felt a little bit like the wearing out part.
A host
The supporting evidence he gave was the number of false starts, which he said has been enough to tire holders even though the drawdown is shallow.
6. Breadth Flips To The Mag 7
For much of the year the equal-weight S&P 500 fund, RSP, looked stronger than the headline indexes and reached highs the others could not. That has reversed.
The equal-weight index has stopped leading
It was at highs when a lot of the other indexes couldn't get there. But now it seems like the MAGS Magnificent 7 trade is definitely kind of back on.
A host
And the contrast between the two funds is stark
When you look at the MAGS which is our Magnificent 7 ETF by Roundill, that doesn't look bad at all. It's kind of like a very big contrast to what's happening with RSP.
A host
The other 493 have handed the job back
So whereas the other 493 were kind of saving the day for a while, it really seems like it's back to the Magnificent 7 now.
A host
Friday itself was an exception, with the Magnificent 7 fund lagging, which both hosts put down to the day-to-day flip-flopping of recent weeks rather than a change in the trend. On the weekly chart, one host said the fund looks close to a breakout.
7. Which Time Frame To Use
The discussion turned to the practical problem of holding a winning position through days that contradict it.
Too much detail can shake a holder out of a good position
for me sometimes I feel like if I get too granular sometimes that trips me up and shakes me out if it's still holding versus its moving averages
A host
An intraday chart makes everything look like a threat
You know, if you spend all your time on the intraday chart, it's going to be very hard to hold things because you know, every little blip can kind of scare you.
A host
Several of the firm's rules sit on the weekly chart, including sell rules built around the 10-week moving average line, and the difference between a 50-day line and a 10-day line is roughly two and a half months against two weeks. The trade-off was stated plainly.
A longer time frame costs drawdown and buys holding power
If you're using a longer time frame, yes, you're going to probably have bigger drawdowns because your signals are going to come a little bit later, but the good news is you're going to be able to hold on to things for bigger gains.
A host
The show also noted that Bill O'Neil, the founder of Investor's Business Daily, worked individual stocks off weekly charts and the market indexes off daily charts, and that the two agreeing is the condition that has been missing.
8. The Junk Bond Signal
The Dow closed below 52,000 earlier in the week and below a marked low at 51,542, and finished the week back above that low while still lagging badly. On small caps, the show brought in a signal raised by Matt Caruso on the firm's podcast during the week.
The chart he pushed was junk bonds
He was very adamant about, hey, you know what you really need to do is look at JNK, which stands for junk bonds.
A host
The chart shows bond prices rather than yields, so it has to be read upside down: Friday's yield rose because prices fell. What had been happening before this week was a slide in junk bond prices, meaning higher yields.
This is the rate companies actually pay
You got to pay up for the extra risk. And this is the cost of money that companies really have to deal with, right?
A host
Treasury yields, he said, are the risk-free reference and the federal funds rate is a bank rate, while this one reflects what companies are doing with their own debt.
Rising junk bond prices would be the signal
what Matt Caruso suggested was look if you are seeing this go up you know JNK going up that's going to be better for the market
A host
The precedent he pointed at was late March and the April and May rally, when junk bond prices rose and yields fell. One caveat on the chart: the fund pays a dividend, which distorts the long-term price history, so the levels on a price-only chart are unreliable and only the short-term direction is usable.
9. Chips Retake The 50-Day
The week's sector split was software against semiconductors. The software fund IGV fell 1.4% on a day the Nasdaq rose, though it finished the week higher and above a rising 10-week line. The chip fund SMH rose 2.2% and closed back above a falling 50-day line.
The close was in the upper half of the day's range
And so we calculate that out for you right there. So you can see 57% so in the upper half.
A host
But the fund has been here before
So it's not just about getting the close above that line. It's about staying above that line. That's what we really need to see here.
A host
Software spent January and February mostly below its 200-day line, got above it briefly in May and could not hold it for more than two days. This time it has held that line longer and has been trending above the 50-day and 21-day lines, which is why Friday's fall did not change the host's view.
The week's AI-safety news drove the split directly
Well, what did that do? Software, went up a lot and chips down a lot.
A host
And the weighting is why it matters for the index
the chips have like twice the weight of software in the NASDAQ composite and the NASDAQ 100
A host
10. ARK And Risk Appetite
The ARK Innovation fund rose 1.5% on Friday after a strong Thursday, which the hosts read as speculative money coming back.
The speculative funds are where the action was
I thought it was really interesting that for as much as we might be a little bit wishy-washy on the indexes, the fact that a lot of the ARC funds you know, which a lot of people consider a little bit more speculative, these are you know, some moonshots
A host
Inside the family, the genomics fund has been strong on the back of a large move in one genomics name, and the host noted the fund holds the infrastructure suppliers for genomics rather than that specific name. The next-generation internet fund holds a substantial amount of crypto exposure, and the Bitcoin and Ethereum funds and Robinhood were all strong. The host also flagged the broad technology fund XLK.
XLK looks close to breaking resistance
It's coming up to kind of this recent resistance area, and that looks like it's on the verge of a potential breakout.
A host
What is missing is confirmation
So, I think there's a lot of, again, a lot of setup opportunities here. Now, we just need that follow-up strength to say it's time to roll.
A host
11. Oil's Uneven Advance
The oil fund USO reversed lower over the last two days of the week after breaking out to highs earlier. Underneath it, the participation is inconsistent. One host described taking a small profit on a failed breakout in the oil-services fund, and contrasted that with three that are working.
The large-cap energy fund only pulled back to its 21-day line
XLE which again is dominated by Exxon Mobile and Chevron. That has pulled back a little bit but only to the 21-day moving average line.
A host
The explorers and producers fund is trending cleanly
And then you also have the explorers and producers XOP that's trending very nicely, keeping right above that 21day moving average line.
A host
He holds the refiners fund, which tracks the margin between crude and refined product prices, and said it paused during the week after a strong run. The one he does not hold is the shipping fund BWET, which trades freight futures rather than shipping shares, split between wet cargo such as oil and gas and dry cargo such as grain.
The trade he wishes he owned
So, as much as I love the crack. I kind of wish I was in this one.
A host
It gained another 20% on the week, which prompted the show's standing warning about buying something already extended.
The further it runs, the worse the entry
But we know that history tells us the more extended that you get the more it means you could be closer to the end of the move or at least get shaken out in a normal pullback
A host
And the ending of a move like this is fast
Yeah, when you're going up at that angle, the pullbacks can be brutal and the end of the move can really pull the rug out from under you very fast.
A host
The analogue he offered was 2007, when pressure on shipping lanes to China produced weekly gains of 10% or more in DryShips and Diana Shipping.
Then it stopped
And just a phenomenal move in those but when it ended it, they came down very quickly.
A host
12. Tokenized Stocks And IBIT
The Bitcoin fund IBIT rose 6.3% on the day, on a regulatory change. The SEC introduced an exemption permitting the trading of tokenized US stocks: digital representations of shares in listed American companies, registered and traded on a blockchain ledger rather than on a stock exchange.
The host called it the thing blockchain was always for
And let's not forget this has been kind of the promise of blockchain, right? It's things like this that was kind of the whole purpose to make it so that you have a blockchain ledger where things are living there where they really can't be messed with, right?
A host
And the point was never the currency
It wasn't so much about the cryptocurrency itself but what the blockchain was going to offer.
A host
Earlier in the week the Clarity Act failed a procedural vote, which he said everyone expected. What surprised him was how few Republicans supported the way it was drafted and how firmly Democrats opposed it without the ethics provisions they wanted. His view is that the act was not the only route to its own objectives, since regulators can reach the same outcomes without Congress.
The rule is to wait for the event, not the expectation
You don't want to anticipate, right? You want to make sure it happens instead of saying, "Well, I think it's gonna happen and everyone thinks it's gonna happen."
A host
He disclosed a small position in IBIT, opened while the fund has been above its 200-day line. A former markets editor at Investor's Business Daily wrote a front-page piece on tokenization a few weeks ago, which the show pointed readers to.
13. Robinhood's Second Chance
Robinhood rose 9% on the day, which the show framed as a second entry after a failed breakout. One host holds it and it sits in the firm's Swing Trader product.
The entry came just before a gap up, by luck
We actually got a really nice entry into Robin Hood right before that gap up. You know, it just looked set up was getting supported as 50-day moving average line. We had no idea that it was going to gap up like that the next day
A host
The position was exited when the stock came back to the 50-day line and re-entered afterward. Some was sold on Friday even though the position had been added to, which was a decision about the calendar rather than the chart.
Exposure was cut to about 60% into the weekend
we just wanted to kind of go in a little bit lighter closer to the 60% level as opposed to the 80% level
A host
The setup he likes is the shakeout and the recovery
it's nice to see a lot of times when you get kind of a shakeout and then you retake an important area and that's what it feels like Robin Hood has done
A host
The pattern was a cup with handle, followed by a gap out of it, a test that probably removed some holders, and a move back through. On the business, the host named crypto trading and prediction markets as the demand the company is capturing.
He is not troubled by what the products are
a lot of things that are you know some people might you know snub their nose at but a lot of people are in these markets and Robin Hood is taking advantage of that demand
A host
14. Elf's Repair Job
E.l.f. Beauty rose 3.3%, pulling back to its 50-day line, having spent a long stretch below its 200-day line. The stock broke out of a cup with handle a couple of months ago and then reported strong earnings, which the show treated as repair work on the fundamentals.
The first breakout was hard to buy
it was really kind of tough to buy this on the first breakout because you were just getting above the 200 day moving average line. We usually like to see more of that base above the 200 day moving average line instead of completely below it.
A host
The pullback is the second opportunity
But the other opportunity a lot of times is that first pullback to the 10e moving average line. So I think that's what we have here.
A host
Friday's bounce was strong relative to the rest of the market, which is the part that got the stock back onto his list. What he wants next is the price back above 100 and the 21-day line back above the 50-day, so the shorter averages sit above the longer ones.
The trend has not changed yet
So, this still has some work to do, but it's definitely back on my radar.
A host
15. Targa Off The 50-Day
Targa Resources rose 2.5%, closed off its highs but in the upper half of the day's range at 64%, cleared a trend line, bounced off the 50-day line and regained the 21-day.
The gap it made earlier has held
I think that there was a expansion with a deal with Exxon Mobile. And you can see that it held the bulk of that gap.
A host
And the support came where it should have
Really it gave up some of that and got support right where you'd want to see it at the 50-day moving average line.
A host
Which makes it a second route into the same trade
So potentially another way to get into the oil and gas space.
A host
The host acknowledged that headline risk over a weekend is what keeps investors out of the group, and said pipelines have already moved a long way while holding above the 10-week line, with the relative strength line trending up.
Bonus Insights
The weekly close is the number the show watches on both charts
Where you have the daily and weekly kind of agreeing with each other at least on a closing basis for the week.
A host
Two guests appeared on the firm's shows during the week, Matt Caruso on Wednesday and Greg Morton on Friday morning, and the hosts said both delivered the same message: stay engaged with a choppy market, because there is no way to know when the chop ends. Greg Morton's version was that a weekend routine and a prepared buy list are what stop an investor missing the turn.
One host also noted that the ARK funds holding what he called moonshots outperforming while the indexes look unresolved is itself information about risk appetite, and that the setups on offer now only need confirmation rather than more strength in one name.
The show's bottom line is that the Nasdaq has done the technical work it needed to do, the S&P 500 and the Dow have not, and the market that follows through will be one in which chips and software rise together instead of taking turns.
Products, Companies & Tools Mentioned
Robinhood (Up 9% on the day; the show holds it, cut back to about 60% invested into the weekend, and names crypto trading and prediction markets as the demand it is capturing)
e.l.f. Beauty (Up 3.3% and back on the show's list after a cup-with-handle breakout, a strong earnings report and a pullback to the 10-week line)
Targa Resources (Up 2.5%, holding the bulk of a gap the show attributes to an expanded Exxon Mobil deal, and bouncing off the 50-day line)
Roundhill Magnificent Seven ETF (The fund the show uses to track the largest technology stocks, which it says has taken leadership back from the equal-weight S&P 500)
ARK Invest (Its innovation fund rose 1.5%, its genomics and next-generation internet funds were the two the show singled out)
iShares Bitcoin Trust and iShares Ethereum Trust (The Bitcoin fund rose 6.3% on the SEC's tokenized-stock exemption; the host holds a small position opened above the 200-day line)
Exxon Mobil and Chevron (The two names the show says dominate the large-cap energy fund, which pulled back only to its 21-day line)
Investor's Business Daily (Whose founder Bill O'Neil worked individual stocks off weekly charts and indexes off daily charts, the method the show applies)
DryShips and Diana Shipping (The 2007 analogue for a shipping fund up 20% in a week, offered as a warning about how such moves end)
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