Below are highlights from the NDW Morning Update Video for the morning of 8/12. Access the the video on the NDW Morning Update Video page. 

• Index futures are higher this morning with the Nasdaq leading to the upside, up around 75 bps.
• It was a relatively quiet day in the market on Tuesday. Stocks were down slightly as the S&P 500 (SPX) dropped 32 bps, the Nasdaq-100 (NDX) fell 33 bps, and the Dow (.DJIA) lost 34 bps.
• While the broad indices were down, semiconductors advanced as the iShares Semiconductor ETF (SOXX) gained a little under 1%.
• International equities were up modestly as the iShares MSCI Emerging Markets ETF (EEM) gained 40 bps and the and the iShares MSCI EAFE ETF (EFA) was up seven bps.
•  July CPI came out this morning, matching consensus estimates of 10 bps for headline and 20 bps for core inflation last month. The futures market was pricing in about a 75% chance of at least one rate increase by the end of the year.
• Cisco Systems (CSCO) will report earnings after close this afternoon. The stock is a 5 for 5’er and sits on a buy signal on its default chart after breaking a double top at $122 last week. Initial support can be found at $108, while overhead resistance sits at $130, CSCO’s all-time high.  

For those who have been following the changes in our DALI sector rankings, it should come as no surprise that Healthcare, traditionally viewed as one of the market's more defensive sectors, has made significant progress in recent months. Since the beginning of June, the sector has added 63 buy signals and climbed to the #2 position in our sector rankings, firmly establishing itself in overweight territory.

Investors monitoring our Asset Class Group Scores (ACGS) page may have also noticed the strength emerging within Biotechnology, which currently ranks as the top-performing group. As a subsector of Healthcare, Biotechnology encompasses companies that leverage biological processes and living organisms to develop products and therapies aimed at addressing a wide range of human health challenges.

The leadership displayed by Biotechnology has been a key contributor to the Healthcare sector's improving relative strength. Given the strong momentum observed across both areas, we examined the historical forward returns of representative Healthcare and Biotechnology indexes following instances when their average ACGS readings crossed above 4.0 and 5.0. The objective of this study is to determine whether elevated group scores have historically translated into continued future performance.

The table below highlights each instance, excluding signals that occurred within one month of a prior signal, in which the average ACGS reading crossed above 4.0 for both the Biotechnology and Healthcare groups. The iShares Biotechnology ETF TR (IBB.TR) was used as the representative for Biotechnology, while the Health Care Select Sector SPDR ETF TR (XLV.TR) was used as the representative for the Healthcare sector. A few observations stand out:

• Biotechnology has historically delivered strong forward returns following a move above the 4.0 ACGS threshold. The group generated positive returns in 67% of observations over both the three-month and one-year horizons, with average returns of 5.98% and 14.51%, respectively. Most notably, the average three-month return of nearly 6% suggests that strength within the group has often persisted after the initial signal is generated.
• The broader Healthcare sector has produced more modest results following similar signals. While forward returns have generally remained positive, the magnitude of those gains has been considerably lower than those observed in Biotechnology. The sector's average one-year return of 5.94% trails the broader market's long-term average, indicating that the signal has historically produced only modest returns.

Taking the analysis a step further, we examined periods in which the average ACGS reading moved above 5.0, a level that reflects even broader participation and stronger underlying group strength. The forward return profile improved significantly at this higher threshold, suggesting that stronger ACGS readings have historically been associated with more favorable performance outcomes. The table below summarizes the results.

• Biotechnology continued to demonstrate exceptional strength following moves above 5.0. The group generated a positive one-year return in every occurrence, resulting in a 100% success rate and an average one-year gain of 31.23%. These results suggest that periods of broad-based strength within Biotechnology have historically been followed by substantial upside over the subsequent year.
• The Healthcare sector also produced notably stronger results at the 5.0 threshold versus the 4.0 threshold. While the number of observations is limited, the sector's average one-year return increased to 19.44%, with positive returns in 80% of cases. This suggests that Healthcare has historically maintained strong momentum and generated above-average forward returns when broad participation across industry groups drives the average ACGS reading above 5.0.

For investors seeking exposure to the group's continued strength, the iShares Biotechnology ETF (IBB) may be worth considering. The ETF recently completed a double-top break at $205, completing its second consecutive buy signal and advancing to a new all-time high. The fund reversed back into Xs against the market in June and maintains a strong fund score of 5.71, along with a positive score direction of 1.75. The beta reading of 0.66 is also noteworthy, as it suggests relatively low sensitivity to broader market movements and reinforces the sector's defensive characteristics. The weekly OBOS indicates that the fund is in overbought territory, so wait for a normalization of the 10-week trading band before considering. Initial support is at $190, with additional strong support between $164-$168.

Each week the analysts at NDW review and comment on all major asset classes in the global markets. Shown below is the summary or snapshot of the primary technical indicators we follow for multiple areas. Should there be changes mid-week we will certainly bring these to your attention via the report.

Remember, these are technical comments only. Just as you must be aware of fundamental data for the stocks we recommend based on technical criteria in the report, so too must you be aware of important data regarding delivery, market moving government releases, and other factors that may influence commodity pricing. We try to limit our technical comments to the most actively traded contracts in advance of delivery, but some contracts trade actively right up to delivery while others taper off well in advance. Be sure you check your dates before trading these contracts. For questions regarding this section or additional coverage of commodities email james.west@nasdaq.com.

Data represented in the table below is through 8/11/26:

Portfolio View - Commodity Indices

Cryptocurrency Update

Cryptocurrency Video (3:18)

The option suggestions featured here are pulled from the NDW Options Ideas tool. These are just a sample of the ideas that can be found there. The Options Idea tool contains numerous additional income and speculative plays. It also offers relative strength-based screens targeting the highest (and lowest) relative strength stocks and ETFs that have recently moved counter to their longer-term trend. To access or subscribe to the Options Ideas tool, click here.

Call

Merck & Co., Inc. (MRK) Nov 20 $130 Call

Put

Chipotle Mexican Grill 'A' (CMG) Dec 18 $34 Put

Income (Covered Call)

Lam Research Corporation (LRCX) Sep 11 $375 Covered Call