In a “Rollercoaster” 2026, Our Analysts Are Cleaning Up

By Michael Salvatore, Editor, TradeSmith Daily

In This Digest:

An 83% win rate for our Alpha Signals subscribers
How Jeff Clark played the bounce in software stocks
This bearish Nvidia trade paid out 25% in four days

The poster boy of the AI boom is in trouble…

The Nasdaq 100 has been the place to be since ChatGPT launched in November 2022.

The index is packed full of giant tech names like Microsoft (MSFT), Google (GOOGL), and Nvidia (NVDA). And it became the poster boy of the AI rally that’s powered this entire bull market.

It rocketed 55% in 2023… 26% in 2024… and 21% last year.

But so far this year, it’s down 0.4%… after a ton of volatility.

And it’s no wonder, given the news cycle.

First, AI disruption fears gutted software stocks.

Then the Supreme Court struck down President Trump’s tariffs, and he imposed a new set of levies on America’s trading partners.

Now, a U.S. and Israeli attack on Iran – and its counterattack against oil-rich Gulf states – has sent oil prices higher and added a new layer of uncertainty to an already-edgy market.

As you can see from the chart below, this has pushed the Nasdaq 100 into a Short-Term Health Red Zone – a sign that the bullish uptrend has broken down.

That’s the first sell signal seen since last March, right before the Liberation Day tariff crash.

This is telling us to be cautious with our investments in 2026. We not only need to make the right moves but also keep our risk management in check.

That means making sure we have stop losses in place… avoiding concentrated bets in tech… and reminding ourselves that no boom lasts forever.

What it doesn’t mean is panic selling.

And as we’ll get into today, there are still plenty of opportunities to make outsized gains in the market, even if the obvious trades are losing their sheen.

Take Lucas Downey’s 5-for-6 win rate in 2026…

Lucas spent years at Wall Street trading desks handling orders for some of the largest money managers on the planet.

While trading stocks and derivatives, he eventually became head of ETF (exchange-traded fund) sales at storied financial services firm Cantor Fitzgerald.

At TradeSmith, Lucas runs our Alpha Signals service. It’s where we use “signal studies” to stack the trading odds in your favor.

Wall Street firms use these studies all the time to inform their trading decisions. But most regular investors haven’t heard of them.

Every stock has its own behavioral fingerprint – unique patterns that repeat over time and signal when a big move is likely coming. A signal study is a way to read that fingerprint.

It scans a stock’s history, identifies the moments that looked just like today, and asks: What tended to happen next?

Not once or twice – but dozens, sometimes hundreds, of times.

It’s an evidence-based approach to trading that allows us to capitalize on rare, hard-to-see patterns. And it’s led to big gains for folks who follow Lucas in Alpha Signals.

Take Lucas’ best trade of 2026 – fiber optics and specialty glass maker Corning (GLW).

In January, he noted that Corning had seen an unusually large two-month gain of more than 25%.

Lucas found that when the stock moved this much higher in such a short timeframe, it had a high probability of continuing to move higher.

It’s all in the graphic below that Lucas shared with his readers.

What it tells you is that after the bullish signal, GLW was up an average of 11.7% two months later. And it had a positive move 73% of the time.

GLW is up much more than that since Lucas recommended it to his subscribers on Jan. 29. Since then, it’s up 40%.

And it’s one of five winners he’s recommended this year out of six signals trades – an 83% win rate.

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Platinum members can now access the beta version of our Signals software…

It sifts through trading setups just like this every day on more than 500 stocks via 1.8 million daily calculations.

Soon, it will expand to 9.7 million daily calculations on 2,700 stocks.

A human trader, no matter how smart and hardworking, can’t hope to match that level of analysis.

It’s one of the most sophisticated pieces of investment software we’ve ever built. And our Platinum members are among the first to use it.

If you’re a Platinum member, you can now log in to TradeSmith Finance and explore the Signals tool. You’ll have also received your first update from Lucas about how to get the most from the tool.

And if you’re not already a Platinum member, stay tuned. Once Signals is out of beta, we’re set to roll it out in a wider launch later this year.

Master trader Jeff Clark is also making volatility work for him…

Jeff is one of the newest analysts here at TradeSmith. But he’s been trading options for more than 40 years.

He began writing newsletters after retiring from his independent, San Francisco-based brokerage house and private money management firm at age 42.

Now, Jeff takes the same strategy he used for his clients – around 100 of California’s wealthiest individuals – and shares these techniques with subscribers.

The most important thing to know about Jeff is that he loves it when volatility kicks up, like it has this year. That’s because, as a short-term options trader, it gives him more opportunities to profit.

Of the 13 trades he’s recommended in his Delta Report so far this year, 10 have closed in the green – with top gains of 68%, 72%, and 141%.

Jeff did particularly well recently betting on a bounce in beaten-down design software company Figma (FIG).

As Jeff told his subscribers on Feb. 10, Figma’s software is used to create designs for mobile applications and websites. The company incorporates, rather than competes with, artificial intelligence.

He went on to say…

Like so many “hot” IPOs, FIG could not sustain the hype. At $120 per share, FIG was trading for nearly 300 times earnings. That’s a tough multiple to justify – even with revenue growing at 40% per year.

If we ignore the hype-induced boom and bust surrounding its IPO, we’ll notice FIG has been on a one-way path lower since early October. That’s similar to the action throughout the software sector. And the decline in FIG since the start of 2026 matches the broad sector action as well.

But the technical price action is what really drew Jeff to the stock. He noticed that FIG’s price kept falling, despite rising underlying momentum. Essentially, the stock was slowing its descent while the market was in peak panic mode about software – and that translated into a buy signal.

Jeff recommended trading a call option on FIG as a way to leverage the potential gain in a bounce in the stock, while also putting less cash at risk. And across two partial sell alerts over the next 13 days, Jeff booked an average gain of 61.8% for his subscribers.

Sit with that for a minute – Jeff recommended a badly beaten-down software stock during the peak of market panic about software companies.

And he did it by understanding the concept of “mean reversion” better than any trader I’ve ever met.

Over his decades of trading, Jeff knows how to spot when a stock is overstretched in one direction or another. That was the case with Figma. And it’s the case with a lot of software stocks right now.

In fact, Jeff also recently recommended his subscribers close a trade on the iShares Expanded Tech-Software Sector ETF (IGV) – a basket of software stocks – for a 120% gain in eight days.

Mean reversion is Jeff Clark’s bread and butter. And even if you don’t subscribe to Jeff’s services, we encourage you to follow along with Jeff in his free eletter, Market Minute. There, he shares short-term trading ideas just like this one several times a week.

Notably, just last week on Feb. 25, he recommended a trade on MSFT that would’ve more than doubled as of yesterday’s close. Another beaten-down software play, using the same principles that guided the trade in FIG.

So sign up here for Market Minute – it’s 100% free, rich in value, and takes less time to read than it takes to sip your morning coffee.

Meantime, the Swans made money betting against the AI hype cycle…

Andy and Landon Swan are the founders of LikeFolio, a platform they built more than 15 years ago to do something most financial analysts don’t bother with.

It tracks what consumers are doing – in real time – across millions of social media posts, web visits, app downloads, and search queries.

Their proprietary data engine then distills this consumer behavior data into a Social Heat Score. It tells you whether consumers are warming up to a brand or quietly walking away – before that shift shows up in any earnings report.

And last week, this led them to a winning trade on AI chipmaker Nvidia (NVDA) in their Earnings Season Pass advisory.

Their data showed Nvidia’s web traffic was slowing, down 27% year over year heading into its recent earnings report.

That didn’t mean Nvidia was doomed. But it was a clue that the AI hype cycle that had powered the stock higher for three straight years was starting to cool. And with NVDA shares touching 52-week highs, there was zero room for error.

They recommended a bearish trade on the stock using a specific options setup with a high probability of success.

Over 10 weeks of earnings season, you can rack up a lot of cash trading with that kind of strategy. And win they did, landing a 25% profit in just four short days.

The next Earnings Season Pass weekly scorecard is due out Sunday. That includes the Swans’ top earnings reports to watch for the week, all the data from the Likefolio platform, and specific instructions for how to trade.

If you want to receive this report, along with every other weekly earnings scorecard for the next year, go here for more info.

Three TradeSmith services… three different tools… three ways to profit…

Lucas, Jeff, and the Swan brothers all have different strategies for profiting in volatile markets like we’re seeing today.

They all rely on market data – not headlines, not gut feel – to find trades that stack the odds of success in their subscribers’ favor.

And in a market this unpredictable, that what separates the traders who are able to harness volatility for profits from the ones who are getting buffeted by this year’s wild market moves.

We’ll continue to report on their techniques here for you in TradeSmith Daily, so you can take advantage along with our other tools.

In a “Rollercoaster” 2026, Our Analysts Are Cleaning Up