The Trading Post | 05.07.26

Good morning,

A U.S.–Iran ceasefire is keeping risk appetite alive, S&P 500 and Nasdaq are pressing fresh highs, oil is sliding as traders fade the war premium, jobless claims and productivity data hit this morning, Fed-cut expectations are still driving the soft-landing trade, and positioning is getting stretched enough to make even the bulls check their seatbelts.

Let’s jump in.

Yesterday’s Post-Market Performance

As of 05.06.26 market close.

Market News

• Risk-on rally rolls as U.S.–Iran ceasefire cools macro anxiety: S&P 500 and Nasdaq are pushing fresh record highs with AI chip names leading the charge, while crude slips as the market removes some of the geopolitical panic tax. Bias remains long ES/NQ on pullbacks into prior breakout zones, but a heavy-volume loss of yesterday’s high would be the first “maybe gravity still exists” warning. Reuters

• Oil slides as traders fade Middle East risk: Crude weakness is pressuring energy names while easing one of the biggest macro headaches for equities. Watch CL and energy equities for mean-reversion shorts into resistance; lower oil also favors a growth-over-value tilt if tech and discretionary keep outperforming XLE and the major oils. Reuters

• Jobless claims and Q1 productivity hit at 8:30 a.m. ET: Labor data is the morning’s volatility grenade, with traders looking for signs the jobs market is cooling without falling through the floor. Expect the first move to be noisy; fade spikes only if price rejects key pre-data levels and VIX/vol futures refuse to confirm the drama. MarketWatch

• Fed-cut narrative stays alive, but one inflation scare can still flip the table: Markets are leaning toward one to two more cuts this cycle, not a surprise hike, which keeps the soft-landing trade intact for now. Watch front-end yields, Fed funds pricing, gold, and the dollar for signs the market is quietly changing its mind before CNBC starts yelling about it. MarketWatch

• Strong month, stretched positioning, fragile egos: After one of the strongest months in years for U.S. equities, sentiment is getting frothy enough to make profit-taking more likely even if the uptrend remains intact. Watch for RSI/MACD divergences, weak breadth beneath new highs, and leaders failing breakouts as signals to hedge SPY/QQQ or tighten stops. Reuters

Earnings We’re Watching

• McDonalds Corp. (MCD) - Thursday (BMO) 

• Nexstar Media Group, Inc. (NXST) - Thursday (BMO) 

• Shell plc (SHEL) - Thursday (BMO) 

• Warner Bros. Discovery, Inc. (WBD) - Thursday (BMO) 

• Airbnb, Inc. (ABNB) - Thursday (AMC) 

• Block, Inc. (XYZ) - Thursday (AMC) 

• Coinbase Global, Inc. (COIN) - Thursday (AMC) 

• DraftKings Inc. (DKNG) - Thursday (AMC) 

• Expedia, Inc. (EXPE) - Thursday (AMC) 

• Lyft, Inc. (LYFT) - Thursday (AMC) 

• McKesson Corp. (MCK) - Thursday (AMC) 

• Microchip Technology Inc. (MCHP) - Thursday (AMC) 

• Motorola Solutions, Inc. (MSI) - Thursday (AMC) 

• Rocket Companies, Inc. (RKT) - Thursday (AMC) 

• Warner Music Group Corp (WMG) - Thursday (AMC) 

• Wynn Resorts ltd (WYNN) - Thursday (AMC) 

Trade Ideas

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Daily Moment of Zen

Why It Matters:

A beautiful reminder that greatness should not require a genius in the chair every single day. Because sooner or later, the chair will be occupied by someone whose main qualification is “available for the meeting.”

For investors, this quote is about durability. The best businesses are not fragile little machines that need flawless leadership, perfect macro conditions, and seventeen PowerPoint decks to survive. They have strong brands, recurring demand, pricing power, healthy margins, loyal customers, and systems sturdy enough to withstand a few bad decisions from the corner office. Ideally, the business keeps printing cash even when management briefly decides to “unlock shareholder value,” which is corporate-speak for “please supervise us.”

For traders, the lesson is similar: don’t build a strategy that only works when you are perfectly focused, perfectly rested, emotionally balanced, and somehow immune to FOMO. That’s adorable, but also fiction. Build a process simple enough to follow on a messy morning, with clear entries, exits, risk limits, and invalidation points. Because eventually, every trader becomes the idiot running the business — usually right after a winning streak.

Simple survives. Complicated impresses people at dinner. Only one of those belongs in your trading plan.