Transcription
Today's number, guys, is one of those ones you just can't ignore. It's been 11 years since we've talked about subprime and private debt markets in such a way. But here in 2026, as we see M2 money supply skyrocket, we're dealing with inflation potentially in a very different way. And we need to be paying attention now to everything in the markets, including why it looks like EU oil is potentially set to skyrocket once again, what exactly is happening on the S&P 500 and many other markets, and why we need to pay more attention to bonds than ever before. Join us as we cover stocks, commodities, and cryptos in one of the biggest daily shows on the planet when it comes to markets around the world. See you soon, guys. This one is not to be missed.
Well, welcome back everybody to one of the largest daily shows on the planet when it comes to markets around the world. Today we're discussing the macro, what's going on from Wall Street's perspective, and of course, the darkpool trades that have been placed over the last week. What do they mean, and why should we be paying attention to what they're doing, not what they're saying? It was a bit of a mixed week in terms of markets, but I think the big story is really underneath the hood. What is going on with private credit? And are we starting to see a shattering in markets as we continue to have an oil crisis around the world?
Well, let's break it down with some of the charts here. And we'll start off with this one here from Zero Hedge over on X. I reposted this one at FX Evolution as well. Links in the description down below. And basically, it shows that redemption requests for private equity funds are continuing to accelerate. Take a look here. There's a breakdown that basically has all of the major credit funds that are on the markets. And you guys can see that there is a pretty obvious trend here. And what is that trend? Well, it looks like more and more people are trying to get their money out. And this is a problem because of course we know some of the biggest banks in the world are exposed to these private equity funds. We also know that of course they're becoming a liquid because recently we've had plenty of them start to limit redemptions. This comes off the back as well as 30-year mortgages start to go up in the US and hit over 6% which we'll look at later on today's video. And financial stress also is seemingly coming up as well.
This chart here shared by shared by the Kobassi letter and Equifax Moody's Analytics basically shows the problem in a chart. What's happening? Well, it looks like we have here subprime financial stress when it comes to loan delinquency rates. And although it's not near the point of the global financial crisis or anything like that yet, you can see that we've gone above some periods here that take us back over a decade. Now, why is this a problem? Well, of course, with rising me mortgage credit stress, fuel prices, and everything else, the cost of living has really never been higher. And this is going to lead into food, as we've already talked about in these videos, because we are seeing in some places over 100% increase in just fertilizer when it comes to what the farmers are paying. And guys, this is going to get pretty brutal pretty quickly, especially the longer everything continues on. And we'll talk about that in terms of structure because remember the markets themselves are going to show us whether they're really freaked out or not based on price action flows and of course that darkpool liquidity.
Let's talk about human psychology for a moment though. This chart here from the market stats always producing great stuff over on X shows that put volumes have gone up to their third highest on record over the last pretty much five six years. And one of the reasons about this is because generally speaking when everyone tries to hedge markets, we often see a bottoming effect in structure and a relief rally. Now, is it always the bottom? There are times in the past where we've actually just been into a relief rally and it's been what we call a deadcap bounce and things got worse. But generally speaking, over the last couple of years, this has been where we've often seen kind of the lows fall markets. And something similar to what we saw here with Subu Trade last week, showing us that if we go back over the last couple of years, again, spy put volume has been growing. It's been getting up there. And it is synonymous with bottoms. And you can see actually as of this read, the markets have found a relief rally as they start to think maybe something is going to come to an end in terms of the geopolitical conflict right now.
But is the retail trader seeing that? Well, the closest we can get to this is really running sentiments. Now, we do run sentiment surveys together here on the channel. So, make sure to subscribe for that if you're interested. But one of the big things here is that we've seen that double AI bearish sentiment here from Blue Kurdic being tracked. And basically, when we have so many people bearish on the markets, what tends to happen? Well, we actually tend to get a little bit of upward flow. And you can see here that if you were playing the stats 6 months later, 87% of the time markets are actually more bullish. Now what that suggests is that sometimes we go down, we have recoveries and then of course if we are actually in some form of stagflation or recession style market then we could actually still drop off later on. We could have like a hump in between. And one of the things we mentioned at the start of this year was that midterm election years do tend to bring two major sell-offs. And often we can get a relief rally in the middle followed by a bigger sell that can come into the midterm election year because remember these are not notoriously very good doubledigit style years when it comes to indices. It's great for trading. It's great for of course understanding markets better. So make sure to sub to the channel guys cuz there's going to be a lot of stuff going on. but it can be extremely volatile and I expect 2022 to get even more volatile as we go through.
Let's have a look here at the S&P 500 Ford market uh fact set data here. This is shared by Fact Set reposted it over on X as well. And basically what it's showing us is that we're coming down to what you would say is in terms of Ford PE ratios not too bad a pricing for the index historically at least over the last kind of couple of years. You can see here that when we get underneath 20, notoriously this has been a point where markets have found dip buys. And when we get into the 16s, well then things get a little bit more serious. And generally when things get into the 16s or 18 period, you'll see the daily 200 moving average usually underneath 30 in terms of underneath 20 to 30, which is basically when we have the breadth of the market itself. All of the stocks are underneath that level. And that usually shows capitulation. Now, we're not quite at that zone yet. I actually wrote a newsletter about this last week. Again, it's a free newsletter. Links in the description if you want to sign up for that, guys. But basically, this is starting to become a little bit of a better price market, mainly because the big tech stocks have gone down. I see it as a bit of a concern though, and I think a lot of you guys do as well, because at least my personal opinion is, are we starting to see peak earnings? Remember, peak earnings is a huge worry in the markets, and we are up to another earning season. So basically, you know, it's going to be a very very important one. If tech shows signs of slowing down, specifically in AI, then we're going to be in some big problems.
Now, what about the stagflation scenario? Uh Tavy Costa over on X doing some great work here, obviously showing from Zura Capital showing that growth is decelerating while inflation is rising across the board. And the problem with this is what's happening here is we're getting a bit of a decoupling. Now, this can lead into significant pressures on the economy. And although I'm not sure we're going to go into stagflation, although a lot of people of course are calling for that, what I do think is this could lead into recession. And that could be way more scary in some ways. The Strait of Hormuz here, tanker vessel crossings. This one here from Andreas Steno. And you can see here from Macrobond, Bloomberg and Steno research showing again the signs here of maybe a potential market hope. Now, what I get by market hope here is that we basically had no tankers going through and now we're seeing a couple going through. Now, there are of course reasons for that, but the problem is with the markets is they like to climb the wall of worry. So, you've got to keep that in mind.
Now, why do we need to be paying more attention to probably the structure and the flow more than anything else? We are still looking for major dark pools to show us that maybe big players have actually bought the dip. uh and at this stage we have a little bit but not that much just yet and remember it is important to usually see them do stuff but the midterm year was a first negative quarter and when we've had first negative quarters as you can see here from blue kurdic Q2 it's not so good guys 27% of the time is it up so what this suggests is that the structure coming into this first quarter of the year suggests that there's going to be a lot of volatility on the horizon and that means we need to pay attention to technicals a lot and of course here on the channel we do that all the time. We've also seen high yield credit spreads of course spike up and when we have increased credit spread spiking then we generally have very poor annualized return. In fact it is negative returns which means that when credit spreads go up that is bonds start to freak out. Yeah we've got some problems underneath the hood in the markets. That's exactly what's happening here in 2026 which makes us a little concerned.
Now to make things a little bit even worse than this, Volume Leaders has actually got an excellent darkpool uh read here which has shown not only the global financial crisis problems but also the 2021-22 issue and now of course 2026 and this is transportation averages. Now you might say well why does that matter? Because it's kind of like the old school backbone to the markets and we've now got even more transactions coming in. Not only did we see the fifth largest, but we've now got the fourth largest and the ninth largest all coming in close to the peaks. Now, it could be accumulation, that's always possible, but if these markets start to break down in the future, that's going to be a big sign of concern because this homebuilders and mortgage stress are becoming now a problem into these markets. We've also got some trades here coming in with USO. Now, notoriously the last couple of trades that have happened here, we've seen kind of temporary peaks in oil. But I do think it's concerning that EU oil that is effectively the future price of what they expect to happen in the EU is continuing to accelerate, which is decoupled from, of course, the normal read that you'll see, which is UK oil or Brent. Now, why is this important? Well, of course, if we're getting Brent at about 110 a barrel and then we've got EU oil showing that is maybe hitting all-time highs, that's showing that maybe the futures market here is predicting that things could be getting a little bit worse in terms of the oil crisis that's going on in the world right now. And that's going to instantly follow through to of course all the key markets and more importantly to the cost of living for so many people out there.
So, let's have a look at the charts that we need to be watching. We'll start here with the dollar and I think the US dollar is a very important chart. It ended up weekly closing pretty strongly when you consider it on the charts and you can see here that it's another week. So that's one, two, three major wicks and a lot of pressure at that 130 that we've discussed. Now have we broken out? I guess on the daily we kind of did just barely. On the weekly we haven't yet. But these wicks do suggest that there is some kind of bid coming through. And if the dollar does go high, then that kind of suggests that the markets might continue to find volatility towards the downside. Remember, this is the largest hedge in the markets. And often we see it as a safe haven. Even though a lot of you guys will say the petrodollar, all this other stuff, you've got to remember it's the knee-jerk reaction of the markets, at least for now. And until proven otherwise, we have to go with what is generally happened in terms of flows.
Let's have a look here at the S&P. The S&P came down on the monthly, got a nice wick rejection by the close. So, got that 6,400 level, hit into a couple of kind of key zones, but not like I would say amazing areas. And you can see here that it's then bounced back up and closed the weekly relatively strong. Now, this is the real market, and we'll note here that it didn't manage to close above the daily 20, which it's now found once, twice, three times, and four times resistance at this zone. Maybe more importantly than all of this though has been our analysis here of the trend line of the market on the way down on the futures and of course the most important level which continues to be guys 6600. You can see here most traded on the way down key trend line. Obviously we've got a bit of a relief rally coming in here. Got a lot of pressure at this level. So what people are going to be looking for this week in terms of the bulls is pushing a new high getting through 6650 maybe a little bit better pulling down and then of course going for the rally. Now, why is this important? Well, all of this will lead into a change of trend in terms of price action. But if you have a look here at the 2-hour, that hasn't quite happened yet. You've got slight gains through 6530. We saw a decentish bottom on both the NASDAQ and S&P in terms of short gains, but this is still the most traded area. So, there's a lot of pressure here from the street, and certainly something we're paying attention to.
Let's jump into the options and see why that is. Now, puts are everywhere. 6,500, 6,400, 6,300, 6,200. You can see here from Menthol Q, tons and tons and tons of puts. Now, I expect the calls to rise up heavily if we're able to get through 6600. And that could create a negative gamma to positive gamma switch in markets. And you can see here why that could be when we look at the options this week. Notice that there are a lot of calls, guys, at levels that you would totally expect. And I know you guys have big brains, so you're obviously looking at this and saying, "Yeah, I can see those strikes." And now I'm starting to understand that actually everybody loves a round number and they're all always buying or selling and hedging around these same zones. It remains that when we look further out at April expirations and third week expirations that we always get tons of puts, but you can see here the calls. So if the markets are going to regain those levels, then they could be into positive gamma and start moving forward.
Now, we've been looking at the Q's recently. Again, 570 on the Q's and 580 remain the put levels. And if we take a look here at the Q's themselves, 580, 580, 570, you get the point. It's pretty much right around or just underneath where we currently are at the time of this recording, which is 585. When we have a look at IBIT, it's been an important one as well. Take a look at Bitcoin. It's barely holding on, but it is holding on. And it's holding to 38. And 38 is the most struck put zone. So that's pretty important. And you can see here that 38, 37, and 35 all remain the most important zones with 42 being kind of where you would expect more positive gamma to take over. So Bitcoin struggling in a range at this stage.
Let's now jump into the leading charts here. And I think the first one we need to look at is the trend is changing to the worst for mortgage holders in the US. And this is a big issue because of course we know that big debt is in mortgages. And you can see here, it's a clean break to the upside. So, we've gone from where we were at 6% all the way to 6 1/2% on 30-year mortgages. We're not as high as we were in '23, but obviously there is a worse market out there right now. And this coupled with, of course, M2 is something that I wanted to discuss. Now, a lot of people are talking about charts such as this. M2 money supply is going up at the moment. Now, previously what happened was we had a constraint or it was meant to be uh kind of like a a tapering going on in the markets because we had of course massive inflation on the consumer side due to stimulus checks and a lot of money kind of escaping the system. Here we have a liquidity crisis. So what we've got over here is we have a private equity crisis that's starting to come through. We have bonds starting to freak out and the market is kind of getting some form of support. The issue is is that is this going to lead into higher prices in the markets as in valuations or is this more of a actual sign of significant concern? I wouldn't pay too much attention to these two charts, guys. I know they seem like they're important, but actually liquidity and all the little secret ways they're doing it is actually not really going up as much as you might think. And actually, what's happening right now is we're seeing the markets themselves shutter a little bit. And if that continues and we get price action to the downside, then we could be in serious trouble pretty quickly.
Let's have a look here at the MOVE index. Now, this is a good sign. We've often said that when bonds markets are showing significant volatility in the MOVE, then usually that means that the markets are going to, you know, continue to fall and they were accelerating. Then we saw a big drop and at that same time we've stabilized in markets. So that's a good sign. Finally, a crush like this on the MOVE could suggest that the stock market is trying to find a hold level for now. And of course, this is going to be narrative driven, but we're going to look at the price action. So, it is actually looking a little bit better for a potential base percentage of stocks above the 200. That's obviously not at capitulation levels, but we did hit into the 20, which is synonymous with at least temporary potential deadcap bounce or bottoms for at least the acceleration towards the downside. We can see why it's stabilized a little bit around here for now.
But have a look at these oil prices. Look at this one here. UK oil is at 111. Now I'm going to show you US oil, which is at 113, pushing that 115 high. Now, yes. Okay. A few years ago, we got up to 128 during 2022. And if you actually go back through your history, you'll see that back in 2008, we actually hit to 150. If that happens, we're in big trouble, guys. And if you have a look here at the Brent Oil Europe Europe price, it actually already hit a higher high. Now, there's different ways to get this. You can get through Bloomberg as well, but basically speaking, yeah, this is a problem because this is going to lead into higher costs for all of us across the board. And I think there are kind of trip switch points. If we end up getting to those areas, then we're going to have significant issues. And I think everything's probably going to be falling at that point. Key levels to watch on the real downside would be 6200. I think that's a really big level for the S&P if we ever get down there. But as we've seen for now, the structure seems to be holding at 66 and 66 is the uh the battle zone between the bulls and the bears, if you like to say it that way.
Now, let's have a look here at the energy markets. You can see here that we have a series of higher highs and higher lows. We actually did start to see volatility at the exact same time. And we got a lot of darkpool trades which suggests that probably the largest move for energy stocks may have just happened and you can see why they've obviously rallied up a lot. Um, daily 20 yeah, we're back to these levels. Volatility has entered the markets though and USO as we saw before uh did see some massive transactions. So it's going to be interesting to see what happens here but you can see again uh a lot of Very careful in those markets guys. You're going to get a lot of movement. Um, and I do think that energy stocks are starting to see somebody at least saying, you know what, maybe I'm maybe I'm going to take a little bit of money off the market. And that's and that's often can't that that usually means a pit is forming. So basically a pullback in time. Well, we'll see in the markets then.
German markets. Yep, we broke down. This is what a WOFF distribution generally looks like. It hasn't regained a higher high. Some people will say, but Tom, double bottom. That's looking bullish. Yeah, certainly the first stage of certain of some kind of recovery. I guess you would say HSI is similar kind of setup but no breakout above. I think it's too early to say that these markets are really in full recovery. And you can see here certain stocks like Tesla as well have just been dropping series of lower lows, lower highs, lower lows, lower highs as the daily continues to kind of get hit and rejected.
Gold, what's going on here? Slight higher high. A lot of people think gold should be up a lot. I don't think it has to be up a lot. You know it is a currency after all and it is very susceptible to illquidity and more importantly huge volatility in markets and you can see here slight change of trend towards the upside may stabilize it. The most important thing to look at is daily 200 on this chart and check out the higher time frame structure and if you have a look at silver it's kind of similar better signs of base structure but nothing yet in terms of like really really strong kind of base structure.
Now some good signs for the US economy has to be Nvidia held up. So you can see here guys, Nvidia went to the absolute bottoming zone. 170 was broken. That wasn't good. It went down to 165. It just held that $5 range of puts and now it's strike going back up. It hasn't made a higher high. So we haven't got through 182, which is a good level to watch. But I think semiconductors that the probably better read here, which is that's a low, that's a lower high, lower low. We need to get through 403. 403. Maybe this market's truly recovering even though most people won't understand why. The point is is that maybe it's finding some kind of relief rally at that issue or that point. Do watch this.
Now remember we looked at IYT as well uh which was from Volume Leaders. That one showing us the backbone kind of you know transportation market and you know you don't want that to be dropped either. So at this stage you know we've had previous times where we had massive transaction and it took a while and then things went really bad. Here we've got clusters of them. So I think that's also got to be considered here in the macro. So short-term might be a little bit different to long-term. And the reason I say that is because the Kospi, the South Korean market to me has probably topped out when it comes to the hardware trade. So that is everyone buying everything to do with AI. It can take a while, could take 3 to 6 months, but realistically when this happened, as I've mentioned, this is probably one of the underappreciated charts in the world right now by most people. I don't like what I see there. That tells me that something's going on with the hardware trade, which ends up leading into semiconductors. So, it's one of those early early ones. Another one that's early early is homebuilders. Now, I talk a lot about homebuilders in our advanced course. By the way, Easter sale, guys. If you want to learn more about how we approp like kind of like look at all of the markets and more importantly look at the technicals and break everything down, check out fxevolution.com. Links in the description down below for the Easter sale. Um, it's always awesome to have you guys come in as well and do some of the Q&A's with us and also the Market Masters Club lives. It's awesome to have you and best community out there for sure, guys, in the investing and trading world. So, uh, yeah, and then of course we've got NASDAQ here. So, when we have a look at homebuilders looking weak, that's showing us that there's something wrong potentially in the debt markets as well. And then we have a look here at NASDAQ, which is showing us some problems in the tech side, which is the double top. Then of course we've got software as well. And you can see here it's a series of lower lows and lower highs. And where are we? We're at those decision points. Similar to 6600 on the S&P, the NASDAQ is back at support resistance 20 moving average on the way down. Pretty interesting zone. Big volumes. Of course, it did hit into the first demand. If it keeps going down, it's probably going down into around that 21 kind of five level, which probably equal about 6,200 on the market. So, you can kind of see here we're still actually in a downward trend on most of these major markets. We're at those decision points.
Bitcoin wise, a lot of people thinking this could be a, you know, some kind of breakout flag. Uh, now if it is, probably hits about 40, 42,000, but it's holding on, guys. It's hodling on for now. It's just barely holding on, but we're looking at 72 and a bit to really see some recovery. And again, this is a major demand zone. We've talked about Bitcoin a lot on this channel. Obviously, we've talked a lot about this flag potential or of course what I think it still could be, which is accumulation, but I tell you what, we want to hold these zones. So, for now, Bitcoin holds on uh for I guess dear life.
Now, in terms of bank holidays and everything, do remember it's an illiquid day here today. A lot of bank holidays around the world, but we do have some information coming out this week and also it's going to be daylight savings for a lot of places as well. A lot of switchovers the last couple of weeks. Good for Aussies if you're trading the American markets cuz things got a little bit easier. FOMC meeting minutes, we've got that Wednesday. That's going to be interesting. And then of course core PCE price. A lot of eyes will be on this one. 8:30 uh and that is going to be a pretty important chart.
So guys, if you enjoyed today's video, then please remember to subscribe. Also, make sure to hit that bell as well. We will be coming at you with so much information over the next coming days and weeks. Sign up for our free newsletter. Links in the description down below. And if you're interested in taking advantage of our Easter sale, either joining us in the live streams, the live private streams for the opens and closes or of course our courses out there, day trading masterclass ultimate or advanced. I think you guys will enjoy those and it could be a really good time to get into further understanding. Remember Warren Buffett has that quote that the best investment you can make is in yourself and I tend to always believe that as well. Remember, it's about speeding up your learning co process and uh luckily we've been in this quite a while. Thanks so much, guys. You have a great weekend. Have a happy Easter with your family and friends. And of course, we will see you very soon.