NVDA Recovers VWAP as Semi Sentiment Shifts; Small-Caps Lag on Yield Pressure

The morning session belonged to the bears as a failed breakout in the S&P 500 futures led to a sharp liquidation toward the prior week's value area high. Tech-heavy tape saw early selling pressure in the mega-caps, but the narrative shifted mid-day as buyers stepped in at the 20-day EMA. NVDA regained its footing after an opening flush, reclaiming VWAP and squeezing shorts into the final hour, suggesting that the path of least resistance remains higher despite overbought concerns.

Small-caps and regional banks faced a different reality as the 10-year yield crept back toward the 4.5% psychological level. The IWM failed to hold its opening range, resulting in a slow bleed for the duration of the session. Traders focused on mean-reversion setups in the Russell found themselves trapped in a low-volume chop, while momentum stayed concentrated in the high-beta AI names and selective energy plays following a bullish inventory draw.

Order flow remains king in this environment of thinning liquidity. We saw significant iceberg orders sitting just above the $130 level in NVDA, which acted as a magnet before the eventual breakout. Looking ahead to tomorrow, the focus remains on the PCE print; expect tight ranges in the morning followed by high-velocity moves. If the market can’t hold today’s late-session lows, we are likely looking at a deeper correction toward the 50-day moving average.

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