Falling Sideways
Since September, both equities and bonds (use SPX & TLT for proxies) have been falling sideways. Meaning, we have gone nowhere fast.
Need proof? That SPX 6532 target I gave last week hit Friday... was from 1st week in September. I don’t just make up those levels!
Gold/Silver have fallen sideways for two months not three, but I still see more of the same into Dec, maybe even Jan.
Point is, I still see nothing to get excited about with all three assets as it relates to durable breakout into year-end.
I could be wrong and I know the levels where I concede. But we aren’t there yet.
And if anything, a Dec rate cut would likely bid yields and dump bonds - just like the past two times they cut: Sept ‘24 + Sept/Oct ‘25.
Anyway, the one change now is the clear intervention by Trump to push a new GENESIS MISSION narrative to backstop the AI circularity and MAG10 bid as distraction from Nvidia investor worries. This will need CONGRESSIONAL APPROVAL in order to fund, but for right now, it’s a story to support the story stocks.
My October 28th post - TOO MUCH OF A GOOD THING - focused on “Options Activity Is All Bulled Up”.
Fast forward, all those excited NVDA + NDX calls that were bought back for Nov/Dec/Jan expiry are under water. Some by a lot.
Sideways is a theta decay killer for directional option traders.
And ‘Falling Sideways’ is the worst market backdrop for anxious bulls AND BEARS alike.
