Trading closed Friday, and while markets are dark today (Sunday), day traders are already setting up for Monday's open. The week ending May 29 was one of the strongest in recent memory, and the conversation across active trader circles revolves around one big question: how much further can this rally run?
The week that broke records
The S&P 500 closed its ninth consecutive weekly gain — the longest streak since 2023 and one of only ten such runs since 1945. The Nasdaq gained roughly 8% for the entire month of May. The Dow Jones crossed 51,000 for the first time.
The headline story of the week was Dell Technologies (DELL). The server maker reported fiscal Q1 earnings that blew past even the most optimistic estimates: revenue of $43.84 billion, up 88% year-over-year. AI server revenue hit $16.1 billion — a 757% annual surge. The stock soared 33% in a single session, the best single-day gain in the company's history.
The tailwind that also helped
A tentative U.S.-Iran ceasefire extension, potentially including a reopening of the Strait of Hormuz, pushed oil prices lower and provided a macro tailwind for equities. For day traders, it means less near-term inflation pressure — and another reason to stay long.
The warning signals experienced traders are watching
Beneath the celebration, technical warnings are accumulating:
- The S&P 500's 14-day RSI is in overbought territory above 70
- The CAPE (Shiller) ratio sits around 41-42, a level seen before only in past market peaks
- Only 56% of S&P 500 stocks trade above their 200-day moving average — weak breadth signaling a narrow rally
- The Buffett Indicator (total market cap to GDP) hit record highs above 200%
Traders on the ground note that historically, nine-week winning streaks don't last forever. Even in the strongest momentum, consolidation or a modest pullback is normal.
Why it matters
Monday is the first test. When the market closes at all-time highs, serious traders don't buy with their eyes closed. The hallmark of experienced day traders is that during euphoria, they size down and wait for confirmation.
If the rally continues Monday, attention will be on continued AI momentum (NVDA, AMD, MU) and signs of broadening beyond the mega-cap tech leaders.
The bottom line
The market has entered unfamiliar territory: nine straight green weeks, indices at historic highs, but strong hints that the ground has gotten thinner. Day traders are staying focused — not swept up in rally euphoria, but not rushing to sell before real weakness appears. Monday's open will show which way the wind blows.
