Our View

The Nasdaq Composite has closed higher for 12 sessions, its longest winning streak since 2009, and despite the tech bubble talk in October of 2025 and the big letdown since the US / Iran war, they look like a “safe haven.” If there is a resolution to the war, I expect tech to continue to outperform.

According to S3 Partners, the average short interest in U.S. software stocks has edged down to about 3.6% of their total shares available for trading, compared with around 3.8% at the end of March.

The VIX, which climbed to 35.30 on 03/09/26, sold off down to 17.40 yesterday. Clearly, there is no fear.

Our Lean

How long can the index markets go up without a 1% or 2% pullback? I think the question is… how high is high?

I do remember in 2009 when the ES and NQ went up sharply, but I don’t think they gained this much this fast. Yesterday, the ES gapped high, had a small rally up to the early high, and then dropped.

That said, calling highs has not worked, and while I think we could see some pullbacks, I think there would be good support between 6980 – 7030. On the upside, if the ES gets above 7095 and holds, 7030 to 7050 could come into play.

That’s all I have to say about that!

Get instant access to our partners’ real-time market data and insights not available anywhere else. Here is last night’s Founder’s note getting you ready for today’s market and explaining the constraints in yesterday’s market. – MrTopStep

Founder’s Note:

Futures are higher on OPEX Friday — ES +26bps, NQ +45bps. VIX at 18.15.

Housing starts data at 8:30.

TLDR: OPEX day. Today the positive gamma blanket likely erodes. Dealer gamma has been supportive of the market all week — today that rolls off, and next week the dampening effect should reduce. The timing is critical: the April 21 ceasefire expiration is Monday, and that lines up with a gamma-reduced vulnerability on Monday. Outside of the Iran situation are the clear signs of single stock FOMO: VIX trading < SPX realized, record call volumes, etc.

Below we have the estimated OPEX impact measured in delta $ terms, and you can see it’s very call-heavy, with weights +80% which is as high we’ve ever seen. These values are driven by the huge equity rally since the start of April: SPX +11% in 2 weeks!

Typically we look for trends to pause and consolidate into expiration. Clearly the market has been surging higher into this expiration, an consolidation is what we have been discussing since Wednesday and VIX expiration. No doubt the market has thus far had other ideas, as the SPX pushes to fresh ATHs.

Outside of OPEX, the challenge we see here is the price of options. While 2 weeks ago calls were seemingly cheap, the landscape is much more expensive. You can see this via Compass, which shows the various major stocks dispersed across the map. This suggests that calls are now much more in favor, and IVs are high not only because of earnings, but also explosive moves higher. It’s hard to buy options at these prices and have them pay off.

OPEX is often a time where positions reset, and things may therefore take a breather. Then there are the apparent signs of FOMO, with stocks like BIRD (+300% in 2 days on AI pivot ), CAR (+300% in 2 weeks) etc.

While there is a clear bid to single stocks, we simply cannot deny the surge in non-0DTE SPX calls. You can see this in the chart below, wherein non-0DTE call volume is just blowing it out. On this topic we note that SPX 0DTE volume %’s have decline sharply over the last few days: from sustainable daily levels +60% to daily marks of 50% over the last week. We quite frankly don’t have a great explanation for why call volumes would surge like this – but its big, and its non-0DTE. Over the medium term this seems rather bullish, but in the short term our read remains “overbought”.

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ES Levels

The bull/bear line for the ES is at 7073.25. This remains the key pivot for today’s session. Holding above this level keeps buyers in control, while acceptance below it would shift momentum back to the downside.

ES is currently trading around 7101.25, positioning price above the bull/bear line and indicating early strength during the Globex session. As long as price holds above 7073.25, dips into this area may offer buying opportunities targeting higher levels.

On the upside, the first resistance comes in at 7135.25, which is also the upper range target for today. A break and hold above this level opens the door for a move toward 7168.75, followed by 7193.50. Acceptance above 7135.25 would confirm continuation of bullish momentum.

On the downside, initial support sits at 7089.00 and then 7077.00, just above the bull/bear line. If price loses 7073.25, downside targets come into play at 7057.25 and 7046.50. The lower range target for today is 7011.50. A break below this level would signal a deeper pullback and potential shift in structure.

Overall, the market is showing strength above 7073.25, with buyers in control for now. However, failure to hold this level would quickly invalidate the bullish bias and bring sellers back into control..

NQ Levels

The bull/bear line for the NQ is at 26460.25. This level is key for directional bias today. Holding above it keeps the market in a bullish posture, while acceptance below would shift momentum back to the downside.

NQ is currently trading around 26563.25, holding above the bull/bear line after a strong overnight push. As long as price remains above 26460.25, buyers are in control and dips into this level may offer support for continuation higher.

On the upside, resistance comes in at 26564.00, which is being tested, followed by 26647.25. A break and hold above these levels opens the door for a move toward 26778.25, the upper range target for today. Sustained acceptance above this level would signal strong bullish expansion.

On the downside, initial support sits at 26460.25, followed by 26350.00. If price loses the bull/bear line, expect a rotation lower toward 26275.50 and then 26142.25, which is the lower range target. A break below this level would indicate deeper corrective pressure.

Overall, the market is leaning bullish above 26460.25, with momentum favoring continuation higher unless that level is lost. Watch for responsiveness at 26564.00 as a near-term pivot for intraday direction.

Polaris Trading Group Summary – For Thursday, April 16, 2026

The session unfolded as a textbook Cycle Day 1 with strong adherence to the morning plan and excellent execution around key levels.

Morning – Structured Start, Two-Sided Opportunity

David laid out clear scenarios centered around the 7055 pivot zone, calling for:

Early on, the market delivered exactly what was anticipated—both the 7075 upside and 7045 downside targets were hit quickly. This reinforced the importance of trusting the levels and staying flexible. The initial move transitioned into a “normal Cycle Day 1 decline”, with expected back-and-fill price action after the prior strong rally.

Key lesson: Don’t overreact to early chop—Cycle Day structure often includes two-way trade before direction resolves.

Midday – Patience Rewarded, Bull Shift Identified

David identified a bull re-shift after the pullback, signaling traders to lean long again. This shift was critical—those who stayed patient and aligned with structure were rewarded.

Afternoon – Trend Holds, Targets Complete

Momentum carried into the afternoon with:

The day closed with a $4.7B MOC buy imbalance and a strong bid into the close—clear confirmation of bullish control.

Overall Takeaways

David summed it up well: “Well-played Cycle Day 1” with full target completion.

Looking Ahead:
Friday framed as Capital Preservation Day—a reminder to protect gains after a clean, high-quality session.

DTG Room Preview – Friday, April 17, 2026

Macro Focus: Middle East de-escalation + corporate earnings

Geopolitics:

Equities / Earnings:

Today’s Calendar:

Market Conditions:

Technical (ES):