BULLISH BIAS (65% Probability)

# DAILY MARKET BULLETIN Thursday, August 20, 2026

• SPY: closed near $769.06 yesterday; watch yesterday's session high and low as the immediate technical reference for today's trading. NASDAQ (QQQ): $716.08 (-0.20%) VIX: 16.01 10-Yr Yield: 4.70% Gold (GLD): $413.84 Fear & Greed Index: 57 (Greed)

• VIX: closed near $16.01 yesterday; watch yesterday's session high and low as the immediate technical reference for today's trading.

- The AB-AI SPY gauge stands at 56.0, placing the index in an upper-neutral position with a positive momentum bias. - SPY is holding at $769.06, and sustained trade above the tactical $754 support area would preserve a path toward resistance near $785. - The model assigns a 65% bullish probability versus a 35% bearish probability, creating a favorable 30-percentage-point spread. - The signal engine has produced 30 strong-buy signals and 10 moderate signals, while the healthy 1.0% yield curve supports growth over the intermediate timeframe.

- SPY remains down 1.13% for the week, and a break below the nearby $754 tactical support level would indicate that the current rebound is failing. - QQQ is down 0.20% at $716.08, with a decline below $702 serving as a warning that technology-led selling is accelerating. - The proprietary breadth data include 54 bearish assets, while the calculated outlook identifies 44% of the monitored universe as being in bearish territory. • VIX: closed near $16.01 yesterday; watch yesterday's session high and low as the immediate technical reference for today's trading.

Maintain a moderately bullish portfolio stance rather than moving to maximum exposure. A balanced tactical allocation could hold approximately 60% to 65% in equities, 15% to 20% in short-duration fixed income, 5% to 10% in gold or other diversifiers, and the remainder in cash equivalents. Within equities, prioritize positions supported by the strongest signals, including biotechnology exposure through XBI and IBB, healthcare leadership through LLY, natural-gas exposure through FCG, and a smaller speculative allocation to ETHE.

Add exposure incrementally while SPY remains above $754 and QQQ holds above $702, rather than chasing strength at current levels. Keep individual speculative positions smaller than core holdings, use defined exit levels, and consider reducing gross equity exposure by 5 to 10 percentage points if SPY closes below $754. Investors with concentrated technology exposure should rebalance toward healthcare, biotechnology, energy, or other areas showing stronger relative signals.

- S&P 500: The $754 support level and $785 resistance level define the immediate tactical range, with a break below support favoring defensive positioning and a move above resistance supporting additional equity exposure. - VIX: A 15.25 floor and a 16.80 ceiling frame the near-term volatility range, with a move below the floor confirming calmer conditions and a break above the ceiling signaling increased hedging demand. - NASDAQ: The $702 support level and $730 resistance level are the key reference points, with a loss of support indicating weakening growth leadership and a breakout confirming renewed technology momentum. - The 10-year Treasury yield: A move below 4.60% would ease equity valuation pressure, while a sustained advance above 4.80% would increase the risk of multiple compression.

The market retains a bullish 65% probability, but neutral index gauges and substantial bearish breadth argue against aggressive risk-taking. Maintain moderate equity exposure, favor the strongest sector signals, and add only on a confirmed SPY breakout above $785 or controlled pullbacks that hold $754 support.

NEXT REVIEW: Friday, August 21, 2026