The Trading Post | 08.20.26

Good morning,

Treasury is trying to calm the bond market, long yields remain the tape’s biggest threat, AI is doing some very heavy lifting for corporate earnings, Walmart gets its turn in the consumer hot seat, and Moderna just reminded traders that biotech gaps can still require a seatbelt.

Let’s jump in.

Yesterday’s Post-Market Performance

As of 08.19.26 market close.

Market News

• Treasury Throws the Bond Market a Lifeline: Treasury doubled long-duration bond buybacks to at least $4B per operation after the 30-year yield reached its highest level since 2007. The 30-year briefly fell toward 5.19%, but with inflation and deficit concerns still lurking, this looks more like relief than a cure. Trader Take: Falling yields support QQQ and growth; another push higher puts duration-sensitive longs back on the chopping block. Reuters

• Walmart Gets the Consumer Pop Quiz: Futures were essentially flat ahead of Walmart earnings and weekly jobless claims, while the 30-year yield climbed back near 5.22%. Trader Take: Let WMT guidance and rates settle before declaring victory on the opening move. Watch WMT’s reaction for read-through into XRT, XLY, COST, TGT, and AMZN. Reuters

• Tech Is Bending, Not Breaking: Reuters sees VGT forming another bull flag, with a measured target around 150–151 and 108 serving as the structural invalidation level. Trader Take: A clean breakout and hold keeps bullish continuation alive. Below 108, the flag becomes less “bullish setup” and more “expensive modern art.” Reuters

• AI Is Carrying the Earnings Backpack: Q2 S&P 500 profit growth is tracking roughly 52%, with technology profits up about 74%. AI-infrastructure names reportedly account for roughly one-third of index EPS growth, although investment gains are inflating some headline numbers. Trader Take: Favor companies producing real revenue and guidance upside rather than buying anything capable of putting “AI” in a press release. Reuters

• Moderna Goes Full Biotech: MRNA surged nearly 177% after its Merck-partnered melanoma therapy met its pivotal Phase 3 endpoint, while MRK jumped more than 12%. Trader Take: After a move like that, chasing the opening print is less a strategy and more an adrenaline hobby. Look for consolidation, VWAP behavior, and defined risk. Yahoo Finance

• Oil Keeps Grinding Higher: Crude is advancing for a fifth straight session, keeping inflation sensitivity front and center just as the bond market is trying to behave itself. Trader Take: Continued oil strength can support XLE while simultaneously making life uncomfortable for growth stocks through the rates channel. Reuters

Earnings We’re Watching

• Walmart Inc. (WMT) - Thursday (BMO)

• Alibaba Group Holding Limited (BABA) - Thursday (BMO)

• Advance Auto Parts Inc. (AAP) - Thursday (BMO)

• Aegon Ltd. (AEG) - Thursday (BMO)

• Deere & Company (DE) - Thursday (BMO)

• NetEase, Inc. (NTES) - Thursday (BMO)

• Ross Stores Inc. (ROST) - Thursday (AMC)

• Flowers Foods, Inc. (FLO) - Thursday (AMC)

Trade Ideas

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Daily Moment of Zen

Why It Matters:

The market isn’t personally attacking you. It just has a remarkable talent for making it feel that way.

The real battle in trading is rarely price—it’s your reaction to price. Fear after a loss, greed after a winner, frustration when a perfect setup fails…all of it starts influencing the next decision. Once your emotional state depends on what the market does, you’re no longer executing a strategy. You’re negotiating with a blinking candlestick.

The goal isn’t to become emotionless. It’s to reach the point where a win doesn’t make you invincible and a loss doesn’t make you rewrite your entire trading plan before lunch.

When your confidence comes from following your process instead of predicting the next tick, trading becomes much simpler: identify the setup, define the risk, execute, accept the outcome, repeat.

The market can still behave irrationally. You just don’t have to join it.