Author: Deep Tide TechFlow

U.S. Stocks: Walking the tightrope at a historical high, the countdown to earnings week officially begins

On Monday, the bulls on Wall Street took another step on the tightrope.

The S&P 500 rose by 0.12%, closing at a historical high of 7,173.91 points. The Nasdaq Composite also closed at a historical high with an increase of 0.20% to 24,887.10. The Dow Jones fell 62.92 points (-0.13%) to 49,167.79, showing a seesaw effect between technology and industrial stocks once again on Monday.

This divergence in performance, where the S&P and Nasdaq rise while the Dow falls, has persisted for several days. The underlying logic is clear: The strong narrative around AI and chips continues to support technology heavyweights, while the companies in the Dow components, such as those in the real economy, consumer, industrial, and dining sectors, are being slowly eroded by oil prices at $107 per barrel and declining consumer confidence.

The driving forces on that day came from two directions:

Nvidia rose another 4%, returning to around $208, just having set a historical high last Friday, and continued to climb on Monday. The market has already treated this stock as a real-time sentiment gauge for AI investments. Alphabet rose 1.8%, Micron surged 5.6%, and the semiconductor sector continued to attract capital.

On the other side, Apple fell 1.3%, McDonald's dropped 3%, and Domino's Pizza plunged 10%. This pizza chain reported same-store sales growth of only 0.9% in Q1, far below the expected 2.7%, and downgraded its full-year outlook for 2026 to low single-digit growth. As high oil prices pushed up delivery costs and consumer wallets tightened, the pricing logic of that pizza began to collapse.

One number worth mentioning here: Since the beginning of this month, the S&P 500 has risen over 9%, the Nasdaq over 15%, and the SOX semiconductor index has rebounded over 50% from its March low, marking 18 consecutive trading days of gains, with the RSI overbought indicator nearing 85.

This is a technical overheating signal that cannot be ignored. The market can continue to climb in the overheating zone, but once bad news arrives, the speed of the pullback will be faster than the ascent.

And bad news may come this week.

The week’s most important countdown: MAG4 + Federal Reserve, a collision on Wednesday

On Wednesday (April 29), the day with the highest density of earnings so far this earnings season: Alphabet, Meta, Microsoft, and Amazon will collectively announce their Q1 earnings after the market closes. On the same afternoon, the Federal Reserve will announce its interest rate decision, reportedly the last meeting of current chairman Powell.

These four companies have already seen their stock prices rise over 10% this month, with hefty capital expenditures driven by the AI narrative getting market endorsement in advance. However, the lessons from last week’s ServiceNow and IBM are still fresh: exceeding expectations can also be a reason to short, depending on the guidance.

Dan Ives at Wedbush has publicly stated that he expects "good news to continue, with the AI revolution advancing at full speed."

But on Thursday (April 30), there are also earnings reports from Apple and Amazon; the Bank of Japan will hold a meeting on the same day; and the European Central Bank will meet on Thursday. The three major central banks plus MAG7, if any one goes off track, the others will tremble.

This is a key time window that could determine whether this rebound completes.

Oil Prices: The ceasefire shell remains, but inside $107, there are already cracks

Brent crude oil broke through $107 per barrel on Monday, and WTI rose to the $95-97 range. In just a week, WTI has cumulatively risen over 13% from $89.

The reasoning is not complex; on the surface, it’s a ceasefire, but at its core, it’s a stalemate.

On Monday, Axios reported, citing U.S. officials and relevant insiders, that Iran proposed a new plan to the U.S. through Pakistan: to reopen the Strait of Hormuz and stop attacking ships in exchange for the U.S. military lifting the maritime blockade and postponing nuclear talks. At first glance, it sounds like a breakthrough, but Trump announced on Saturday the cancellation of the trip by Witkoff and Jared Kushner to Pakistan, stating on Truth Social, "It's a waste of time; just a phone call will do."

That statement left diplomats speechless. When negotiators are no longer flying, any proposal is just ink on paper. The blockade of the Strait of Hormuz persists, tankers continue to divert around the Cape of Good Hope, and Asia suffers a daily supply loss of about 5 million barrels.

A detail that complicates market sentiment: Previously, Iran proposed to levy "tolls" through Hormuz, with settlement in stablecoins or Bitcoin, around $1 per barrel. Chain analysis company Chainalysis disclosed this week that on-chain activities of the Islamic Revolutionary Guard Corps (IRGC) exceeded $3 billion in 2025, primarily in stablecoins. The "crypto toll booth" on Hormuz is transitioning from a conspiracy theory into a documented fact.

Gold: $4,730, following inflation but not fast

Gold closed Monday in the range of $4,730-4,750, following the rise in oil prices but with limited gains.

The driving logic remains that contradictory transmission chain: oil prices → rising inflation expectations → stronger dollars → pressured gold prices; meanwhile, persistent war risks → safe-haven demand supports gold prices. The forces in two directions counteract each other, causing gold to move in a slow climbing horizontal line.

Warsh’s statement during the Fed chair candidate hearings about needing to "establish a new framework to address inflation" remains undecided. If the Fed maintains interest rates this week but has a hawkish tone, gold prices will be under short-term pressure; conversely, if Powell’s farewell performance has dovish undertones, there may be room for gold prices to rebound.

Cryptocurrency: $79,488 within reach, then turned back

In early morning trading on Monday in Europe, Bitcoin surged to $79,488, hitting a 12-week high, just a breath away from the psychological barrier of $80,000.

Then, as Brent crude broke $107, Bitcoin began to retreat.

As of the close of U.S. stocks on Monday, Bitcoin slipped to the $76,600-77,900 range, down about 1.5% over 24 hours, Ethereum fell about 3%, and XRP and Solana each dropped about 3%. The CoinDesk 20 Index (a broad index of the crypto market) fell by about 2%. The global cryptocurrency market cap is about $2.68 trillion, and the fear and greed index remains below 46 in a neutral to fearful range.

A report from Bitfinex analysts on Monday highlighted an important structural signal: short-term holders took profits between $78,000-79,000 during this rebound, partially offsetting the buying pressure from ongoing inflows of ETFs and strategies. In other words, institutions are buying, but short-term bulls are selling. These opposing forces kept Bitcoin stuck at the $80K threshold.

Data cited by Bloomberg shows that the initial news about Iran's Hormuz proposal did pull Bitcoin from the $75,000 range to $79,488. However, the subsequent rebound in oil prices dampened that optimism. The price of Bitcoin has become a real-time barometer of progress in Middle East discussions.

Today's Summary: The grand performance begins, and this week decides the quality of the rebound

On April 27, both the S&P 500 and Nasdaq set historical highs, but U.S. stocks are walking on a thin tightrope:

U.S. Stocks: S&P 500 closed at 7,173.91 (+0.12%), Nasdaq closed at 24,887.10 (+0.20%), both setting historical highs. Technology stocks and chip sectors continue to lead, while consumer stocks are under pressure. Domino's plunged 10%, exemplifying the squeeze on real consumption due to high oil prices. This month, the Nasdaq has risen over 15%, and the SOX chip index has seen 18 consecutive days of gains, signaling significant technical overbought conditions.

Oil Prices: Brent broke through $107 per barrel, and WTI rose to $95-97, with a cumulative increase of over 13% during the week. Iran proposed the Hormuz reopening plan, but negotiations are essentially stalled, and Trump canceled the diplomatic delegation's trip to Pakistan.

Cryptocurrency: Bitcoin hit a 12-week high of $79,488 in the early morning but then retraced to around $77,000 following the rise in oil prices, falling 1.5% for the day. Each failure to break the $80,000 barrier continues to deplete the bulls' ammunition.

The market is only concerned with one thing this week: Will Wednesday's MAG4 earnings withstand expectations?

Alphabet, Meta, Microsoft, and Amazon have all risen over 10% this month, and their valuations have priced in the continued explosive narrative of AI. If the guidance from these four companies is below market expectations, or if Capex growth disappoints investors, Wednesday's after-hours trading could signal a painful end to this round of rebound. If all exceed expectations, the market can continue to rise for a while longer.

Additionally, a small but significant signal: The National Development and Reform Commission of China ordered Meta to withdraw its $2 billion acquisition of Singapore AI startup Manus this week. The geopolitical fragmentation of AI competition is expanding from chip export controls to capital merger levels.

This week will be much more eventful than last week.