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Looking back at the market in the first half of 2026, I have some fairly clear observations: Overall, this market rally has been very typically driven by the technology and AI sectors. At the index level (S&P 500, Nasdaq), prices remain near all-time highs, though the upward momentum has weakened somewhat compared to the beginning of the year, and the RSI has returned to a relatively neutral zone. The overall trend remains above the 200 day moving average; from a broader perspective, the market remains bullish, but in the short term, it appears to be consolidating within a range at elevated levels.
The more noticeable changes lie in the “internal structure”: AI and a handful of large cap tech stocks continue to dominate index performance, particularly the semiconductor and AI infrastructure sectors, which are showing sustained strength and concentrated momentum. Meanwhile, small cap stocks occasionally see rebounds, but these lack sustainability and tend to reflect rotational and selective opportunities rather than a broad based rally.
My strongest impression is that the current market structure resembles one where “a handful of core assets drive the overall index,” rather than the previous environment of broad based gains. Market sentiment is also swinging back and forth between two narratives: on one hand, the long term growth logic of AI; on the other, concerns about high valuations and overheating.
As an ordinary investor, my sense is that the bull market is still here, but it has definitely become more challenging to navigate. The pace has accelerated, divergence has intensified, and the demands on market timing and stock selection have become higher. I, too, have started paying more attention to pullbacks and structural opportunities, rather than simply chasing breakouts.
To sum it up, this current phase tests three key areas: sector selection, concentration on specific stocks, and timing of entry and exit.
I’d like to hear everyone’s thoughts: Do you think this is a normal phase of the AI cycle? Or is the market entering a phase characterized by greater structural shifts and intensified divergence?