The Friday Wrap — September 25, 2026: the 10-year at 5.2%, and chips ran anyway

The bond market kept selling

The week's biggest move was not in stocks. The 10-year Treasury yield jumped more than 10 basis points on Thursday to as high as 5.223%, per TradingEconomics, and Axios had it at 5.19% on Friday as the selling carried into a second day. CNBC called the week volatile and the Friday close little changed. A week earlier the 10-year had slipped back under 5%, and that was the relief equities rallied on.

Axios laid out several causes, and none of them is exotic. Wednesday's purchasing-manager surveys pointed to strong business in both manufacturing and services. A 5-year Treasury auction drew unexpectedly weak demand. Government bonds sold off abroad too, with Japanese government bonds, UK gilts and German bunds all under pressure in the same days. One Fed governor said on Wednesday that more rate increases will likely be needed to get inflation back to 2%.

That is the backdrop to last week's decision. The FOMC raised its target range a quarter point on September 16, to 3.75%-4.00%, on a 12-0 vote, its first increase in more than three years, per CNBC. The statement said inflation "remains elevated." Futures did not read it as the last move. CME's FedWatch tool showed a 73.5% probability of another quarter-point increase at the next meeting as of Thursday's close. Last week's letter reported 53.1% for the same question, so the market spent the week pricing more tightening.

Crude eased, and stayed high

Oil fell into the weekend on hopes that Hormuz could reopen. WTI futures settled at $92.41 on Friday, down 2.33%, and Brent at $104.32, down 2.14%, per Yahoo Finance. TradingEconomics put the Brent-WTI spread at $12.68, the widest since May. The coverage described a two-sided week. US and Iranian negotiators were reported to be exploring a deal in New York that would lift the naval blockades on tankers and ease sanctions, and there were reports that Saudi Arabia's East-West pipeline was reopening. Against that, Saudi Arabia said on Thursday it had intercepted Houthi missiles, and The National reported an Iranian military adviser threatening to widen the conflict to the Indian Ocean.

Our proxy tells the same story in two time frames. USO fell 3.11% on Friday and 3.57% on the week, and it is still up 10.94% for September and 31.01% above its 200-day average. The shock has stopped building. It has not unwound.

A chip rally ran through it

Monday did most of the week's work. The Nasdaq Composite rose 2.26% to a record 27,125.09 and the S&P 500 gained 1.49%, per Yahoo Finance, the best day since early August in TheStreet's count. The iShares Semiconductor ETF closed nearly 5% higher. The coverage cited optimism about US-China talks on AI safety, AI hardware demand and easing oil prices.

The broker's bars show how concentrated it was. On Monday alone AMD rose 9.95%, crossing $1 trillion in market value, Intel rose 12.14%, Meta 11.34% and Arm 17.16%. Across the whole week, Friday close to Friday close, AMD finished up 12.60%, Meta 12.94%, Intel 13.22% and Arm 12.68%. Nvidia was up 1.26%. The rally that carried the Nasdaq to a record was not the largest AI name. It was the second tier catching up.

Friday was quieter and less even. The S&P 500 added 0.51% to 7,743.41 and the Nasdaq 0.5% to 27,068.72, still under Monday's record close. The Dow rose 0.93% and snapped a three-week losing streak. Two of Monday's leaders gave some back on the last day, with Meta down 3.30% and Intel down 3.48% on the session.

There was very little earnings news to test any of this. The reports that matter land next week. Micron is scheduled for September 30, and FOREX.com's preview put consensus at $31.45 a share on $50.8 billion of revenue, against $3.03 on $11.3 billion a year earlier. That is a tenfold rise in a single year's EPS, and the stock ran into it, up 6.49% on the week to $1,081.69. Nike reports on October 1 after the close, per the company. Seeking Alpha's preview has the stock down about 43% this year into the print, with revenue expected to fall 3.2%.

The week on the tape

SPY closed at 771.35, up 1.27% on the week, which ends the run of two red weeks from the last letter. It sits 0.99% above its 10-week average at 763.81 and 0.90% above the 8-week at 764.48. Weekly MACD is still negative even with the price repair, so momentum has not caught up with the level. The two-red-week analog is not in effect.

Friday closed above its open, inside a narrow 766.29 to 772.28 range. The daily stack is in order, with the 10-day at 764.98, the 20-day at 765.35, the 50-day at 761.57 and the 200-day far below at 718.45. The 20/50 spread is +0.50% and still narrowing, which says the shorter average is not pulling away. Daily MACD turned positive this week. ATR is 5.25, about 0.68% of price. The close is 0.5% under the 20-day high of 775.30 and 1.0% under the 60-day high of 779.37.

Where the three disagree

This was the widest split of the month. QQQ gained 3.19% to 744.50, its close 4.04% above its 10-week average and 0.5% under its 60-day high of 748.35. Its daily stochastic sits at 92, which is a description of how far and how fast it has come. Friday left a long lower tail covering 51% of the day's range, with buyers stepping in under 740.

IWM went the other way. It fell 0.75% to 281.97, its third straight red week, and it is below its 10-day, 20-day and 50-day averages. Its 20/50 spread is -1.83% and widening. The close is 1.05% above its 60-day low of 279.05, which is also its 20-day low. It is still 2.28% above its 200-day.

The month makes the point harder. QQQ is up 3.87% for September and IWM is down 4.07%, a spread of 7.94 points. Last week's letter reported 3.99 points, so the gap doubled in five sessions. SPY sits between them at +0.56%. The year keeps it in proportion. Year to date SPY is up 13.11%, QQQ 21.19% and IWM 14.55%, so a small-cap holder is still ahead of the S&P for 2026. The quarter is where it hurts, with IWM down 6.15% against SPY's +3.29%.

The week's two forces landed on opposite ends of the size spectrum. The bond sell-off and the hike pricing belong to everyone. The chip rally belonged to a handful of large names, and the index built around them absorbed a 5.2% 10-year without trouble.

Cross-asset

These are ETF proxies. USO is not WTI, UUP is not the dollar index, and VIXY holds VIX futures, not spot VIX.

TLT fell 2.38% on the week and is down 3.88% for September, now 7.41% under its 200-day. IEF lost 0.88%. That is the yield move from the top of this letter, seen from the price side. UUP rose 0.81% on the week and 1.78% on the month, so the dollar proxy firmed alongside yields. GLD fell 1.93% on the week and 3.68% on the month and sits 5.53% below its 200-day. VIXY fell 2.81% on the week and is 11.44% under its 50-day. A 10-year yield near its highest since 2007, the level CNBC flagged on September 15, did not register in volatility futures as an event.

Open interest

Open interest only, from OCC data as of September 23, so it is not Friday's book. For the September 25 expiry that settled on Friday, the largest put strikes were 745 with 145,800 contracts and 730 with 135,841, both far below spot. Calls clustered closer, at 785 with 30,711 and 772 with 28,410. Friday's close of 771.35 landed within a point of that 772 strike. The next expiry, September 28, is thin by comparison. Its largest call is 780 at 12,127 contracts and its largest put is 735 at 8,988.

Next week

From our audited local list, the August PCE deflator lands on Wednesday, September 30 at 8:30 ET, and the September jobs report on Friday, October 2 at 8:30 ET. From our local earnings cache, which covers 13 semiconductor names only, Micron is scheduled for September 30. From the research, Nike reports on October 1 after the close, per the company's investor relations page. Dates move, and the local list ends on October 2.

What we don't carry

No dark-pool prints, no closing-auction imbalance, no spot VIX and no true gamma exposure. The levels come from SIP bars and OCC open interest, and the macro from the outlets named at the bottom.

What this sets up

The through-line is that the cost of money rose again and the market charged it to one end of the tape. The 10-year touched 5.22%, futures moved toward a second hike, and QQQ still gained 3.19% while IWM posted its third red week. The gap between them is now 7.94 points for the month. Next week puts both halves of that argument on the calendar. The PCE deflator on Wednesday is the inflation read the committee answers to. Micron the same evening is the earnings case under the chip rally, at a consensus ten times last year's. The jobs report on Friday closes the week.

The levels that would say which half gives are close. SPY's 20-day at 765.35 and 50-day at 761.57 sit under Friday's close, with the 20-day high at 775.30 above it. On the thin September 28 book, 780 is the largest call strike and 735 the largest put. QQQ is 0.5% from its 60-day high of 748.35. IWM is 1.05% from its 60-day low of 279.05, and a break there would be a fresh 60-day low. Which way any of these resolves is not ours to say. Where they sit is.

The Coil board

The account is in day mode as of Friday. The SPX book has names on in agile, chop-capped mode, with SPY and four of eleven sectors open (Energy, Financials, Health Care, Information Technology) and 172 names fully qualified. The QQQ book has names on in swing mode, with four of six sectors open (Biotech & Pharma, Internet & Media, Semis, Software) and 33 names qualified. Our macro read is risk-off and defensive, standing down on longs. Crypto is constructive, with BTC 19.1% above its 200-day gate, both sleeves in, and 68 of 81 panel names above their own 200-day.

---

Read the board at coil.trade/scanner. Own the engine for $79, one time, at coil.trade/buy/engine.

This letter is impersonal research produced by an automated system. It is not investment advice, it is not a recommendation, and it does not account for your circumstances.

Sources — prices, ranges, moving averages and weekly statistics from our own Alpaca SIP bars, split-adjusted; open interest from OCC data as of 2026-09-23; single-stock closes from the broker feed. Macro and news from CNBC, Axios, TradingEconomics, Yahoo Finance, TheStreet, The National, FOREX.com, Seeking Alpha and Nike's investor relations page.