Transcription
Over the last week, we've been discussing the idea that October might be weaker than normal, and the evidence continues to build with new tariffs coming in over the last 24 hours on pharmaceuticals, trucking, and even kitchen benches. So, what exactly is going on in markets right now as we hit one of the most important levels on the S&P 500 that we've seen in over a month?
Well, it's all about the daily 20 moving average. And what happens here will be important, but potentially it could be even bigger when you start to look at money flows. Bitcoin is back to the same type of level and the dollar index is flying high. So what exactly is going on? Could we be heading for a way bigger thing than any of us think about?
Well, darkpool suggests something is on the horizon and Wall Street has been very active. Join us today, guys, as we cover everything that we need to know right now, whether you're an investor or trader in stocks, commodities, and cryptos. And boy oh boy are there some bombshells to discuss today.
Well, welcome back everybody to the Daily Show. My name is Thomas Atinson and in today's video we'll be taking a look at everything that you need to know from the macro that's moving the markets to the data to the darkpool transactions from Wall Street and even some insider moves that might surprise you. Let's break down though some of the big stories of last 24 hours to really figure out if there's anything here that's going to give us any edge. Then we'll get into some of these darkpool trades.
First up here, contributions to real GDP growth. The number came out and it was better than even expected from Wall Street. They expected 3.3% growth. Well, it turns out that the economy grew at 3.8% growth. And this is actually a pretty big outlier number. Yet, what did the market do? It still fell off. And this is because this number is pretty well known by the robots and the algorithms by figuring it out.
But I think the most important thing here is that remember this is not usually what you get into a recession or depression. So remember with one of the things about GDP, it's always important to note what is driving it. What is actually happening underneath the hood? And I think David Einhorn is probably getting on to one of the most important points at the moment here, which is that there is a ton of capital spending coming into AI and that there usually will be losses.
Now, this actually happened in the 2000s as well during the dotcom boom. And a lot of you guys may not be aware, but what happened was a lot of infrastructure was put in place for the internet back then that was actually never used. And that may shock you when you think about it, but it was never used. And it was estimated huge amounts of billions of dollars were wasted over that period of time as everyone jumped on board the next big technology.
Now, this is absolutely the normal thing to happen, but it does suggest, are we getting towards that point where the market's getting a little bit too excited. Everyone calls it a bubble, but let's just take a look here at the stats since the invention of Chat GPT and the launch in November 22. 75% of the S&P 500 returns since then have come from AI stocks, 80% of the earnings growth and 90% of the capex growth. So basically, everyone's just spending all the money on AI infrastructure and AI buildouts. We're seeing data centers go up everywhere and some of those are increasing people's costs of electricity around the areas of upwards of 70% of the overall cost increase.
So you can see here clearly guys there's a lot of build and I'd be very interested to know whether you think it's the same as the dotcom boom where it was eventually the main technology of course the internet which we use right now was absolute game changer for the world but it still takes time to come in or whether you think AI is going to happen and this time is going to be different we're not going to have a problem in between always interested to see your comments down below so chuck them in there and I'll read them and definitely if I see something there we'll mention it in the next video.
So, let's now talk about where we're at. We thought about a week ago we were starting to get some extremely interesting data reads towards an overbought market. We talked about the squeeze for two to three sessions after taking the high and then we talked about the extreme overbought conditions thanks mostly to us the retail trader who has been trading heavily in particular baskets of stocks.
Now JP Morgan's latest report obviously showed that this was running similar to what we had back in 2021 when of course we saw the rise of ARC and other funds and what we ended up getting was extreme overbought action on pretty much all of those. At the same time of that we also know that most likely retail traders have been taking on too much debt. Now why is that? It's a mixture of margin going up across the board and a mixture of of course ratios.
Now, we've seen so many people stump into calls that we hit a very very big point which tends to give us and I will say this usually shallow style pullbacks which are designed to liquidate calls at euphoric types of moments. Now, this is a 0.45 ratio on the put call index for single stocks. So, the thing that we've seen a lot recently is that retail traders in particular are moving into single stocks. Why wouldn't you? It's a broadening market. At the same time, we're taking more leverage.
Well, let's now have a look at some of the biggest trades that have come through cuz I have not seen this in a while. And that usually happens more at key turning points, which is massive amounts of clusters of trades. This was the biggest cluster ever recorded on the Russell 2000 with huge amounts of dark pools all put through the same position. And of course, since then, the market has dropped a little bit off this level, but we've had even more than that. We got the largest trade ever on the MAGS magnificent 7 ETF. So this was a huge level and you can see here that these have often marked really big turning points whether it be up or down but often of course when they're coming after a great rally it has been to the downside. The largest ever transaction coming through possibly some of the most important stocks out there as well.
BO also has a cluster on it. We've got more clusters coming in before a previous session. Q has the second largest transaction on it, the biggest dark pool transaction on it. That's the biggest NASDAQ ETF. The SPYG growth portfolio had the number one largest dark pool transaction on it. The Broadcom had the 15th largest dark pool transaction on it, which often came in clusters. Again, this was a second cluster, so there was a couple of trades there. And then we've even seen some of the uranium stocks starting to get massive trades on them.
And what this is kind of suggesting is that we may be at that kind of point where maybe October is going to be negative and the markets may pull back further. Now the good news is and you'll see this in a moment that even if this does occur, there's a good chance the markets will continue to rally. So will it be another buy the dip situation? It does look like it's kind of leaning that way. But of course, we always need to look at the evidence-based approach, which we do here on the channel.
And a lot of this is going to be about how many cuts are we going to end up getting from the Fed. Lots or just a few. A few usually leads to cyclicals. And quite a lot usually favors defensives. And we're also going to be looking for the types of sectors that maybe need to be picked up because over the last 24 hours, we've actually found out even more information.
Now, supposedly, and I'm not going to get too into this, but supposedly Pete Hegsth has requested like pretty much all the generals to go to some place. And I don't know what's going on. Maybe you guys do. I don't we don't know yet. But this could also be causing some concerns in maybe what's going to happen into the future. So, we may find out about that over the next week, maybe next couple of days, maybe next hours, maybe even when we've uploaded this video.
But what this is leading into is quite a lot of movement in the oil market. Now, it's my guess that the oil market was already ahead of this. It does tend to be ahead of these types of things. It also tends to be ahead of potentially reinflation. And what we've seen in recent videos is basically a pickup in oil. And that's happened for the last two sessions in particular. And so far, it's been going quite well.
Now you may not know this but this is actually the period of time that oil tends to do better anyway in the end of the year. So generally if you're looking at XLE that is oil stock seasonality it tends to do better over the months of October, November into December into the end of the year. And that is also happening a little bit here against the news when it comes to corporate insiders because corporate insiders while this is not energy are buying healthcare stocks. In fact, they're going ballistic at buying healthcare stocks. Have a look at this. The insiders in healthcare stocks are purchasing at pretty much their fastest and best rate ever while they're copying tariffs left, right, and center.
And I guess this is probably showing you that the market is pretty good at pricing in a problem. And then it's pretty good at going against the trend. Remember, in this channel, we always talk about if it's in the press, it's in the price. So, what we're often seeing is markets move before something occurs. Now, it's interesting to see insiders buying their own stocks here for healthcare. But with the energy stocks, what we've already seen is breakouts in several of those sectors ahead of anything that may be happening over the next week. And we don't know what's going to happen. I'm just saying that price action is breaking out. And now all of a sudden, these stories and these information is starting to appear as well.
So, you might say, okay, well, all these dark pools, does this mean it's the end of the market? Is this the turning point? Is this finished? Well, the good news if you're a bull, maybe not if you're a bear, is that when we have similar situations where we've got a relatively good September, which is actually quite rare, and we've had a pretty good June, June, August, June, July, August, September run, then we tend to actually have maybe a weaker October, but a great Q4 return. And if you have a look here at the latest data from Blue Curtic Market Insights, we can see here the October return might be negative only 40% of the time in similar situations was it actually positive but November to December was 100% and October to December that is that if you own stocks even into October 100% of the time they were up in similar circumstances.
So I think this is one of those points where you say okay do I need to be worried? Well probably not. based on at least the evidence. You can see here from Ryan Detric as well, November in similar situations, June, July, August, September tends to be positive overall. But again, October is the worrying month. So the data kind of suggests that October is the problem and that November, December are probably not. And what we'll find out by that time is, of course, the structure on these markets.
Now, you guys know we've been talking about this for ages. If you're new here to the channel, make sure to subscribe for this type of stuff cuz it's pretty big information over the next couple of months. But we did this last year and we'll do it again this year, which is we'll be looking at what is leading the market. Is it small caps, midcaps, large caps? Also, how is the market reacting to the Fed rate cut? Is it just rising up or is it starting to dwindle? Because of course, if it dwindles, the issue with that is that is more of a recessionary path. So the structure of the market is going to be important. And do remember guys that we've already been thinking this way because of course at the moment October was the weakest read from Wayne start of September. So you got to remember this is this is kind of like the normal way that you look at things and this is taking into account the fact that we had a pretty good summer. So again, the data stats do suggest, even a Wayne study here, that the market will probably rebound from whatever dip is going on right now.
So let's take a look at what the dip actually looks like. The advanced decline line has of course started to drop off, which basically means less stocks are advancing, which would make sense. The markets are coming down and we've just hit our first critical level. Now, this is the 20 daily moving average. And if you're not familiar with the 20-day moving average, it is probably the first line of defense in pretty much any decent bull market. And if you go back over here, there are sometimes periods where when it cracks these levels, it really starts to move towards the next point. And I think that's what I want to mention here.
So, we'll go back over to that 2024 moment when, of course, it fell through that zone. And what you'll notice is that generally speaking, the market likes to come back to the 20 weekly moving average. So it's kind of like you lose the daily 20, you're probably going to go towards the weekly 20. And we'll look in a moment where that actually is. But this is a very important zone. It makes sense to have spiked up to also have held 6600 over the last 24 hours. And we'll look at the updated options in just a moment. But this is the first support. If you are a very aggressive dip buyer, this is the type of level where you would generally say, okay, well, you know, this was pretty much that little pullback that I wanted and I'm going to start, you know, looking more towards the upside. In fact, as a percentage, although it's only 2%, that's what's been one of the biggest buys.
Now, one of the things I like to do, and a lot of you guys like to do, I'm sure, here on the channel, is to actually look at the smaller time frame. And what you'll notice is that you have quite a lot of volatility around here. So you got dip buying, you got selling, you got dip buying, got selling, and that it's kind of getting towards that point where you can now go to the smaller time frames and say, well, did we start to create structure? So basically, you know, where are buyers going to potentially come back in? Well, levels like 6622 going to be very interesting to watch over the next 24 hours. Levels like 6652 are going to be very important to watch as well. And if we do take a lower low, it suggests of course that weekly 20 could be in.
So if we go to the weekly here and we have a look at that, you'll notice that ends up being at around 6300 at this stage. So kind of it goes from being up here all of a sudden to being more likely this in October. Now this would be perfectly normal. We haven't touched the 20 moving average since the huge rally. And if you go back to things like very, you know, pretty much the other only other large V-shaped recoveries, this being a classic one, once the market had made new highs, which you can see here in 2020, then it did come back to the 20 twice and then rallied up. And this is actually where Wall Street picked up most most of their positions. Remember, Wall Street made a mistake here and didn't get enough back in 2020. They thought the Armageddon was coming, fair enough. And they weren't able to actually pick up enough position. So when it went into this sideways, they went in big time while scaring everybody a lot. So this is a very interesting conundrum. This could be where we find ourselves. And one of the things here is if we do go to the weekly 20, you've got to think that at least there it may be defended.
Let's now have a look at the options for the next 24 hours. Clearly 6600 is an important level. If we move below that, we're probably going to go into negative gamma. That's going to put a ton of pressure on that daily 20 and we may fall through. And the next level to look at is around the 65 kind of 60 zone because that's becoming a very heavy put zone as well. A lot of options moves over the last 24 hours. I think we'll have to see how this week closes to really get a bit of a gist of what's happening, but we will come back at you over the weekend with of course some further evidence based on these levels.
Now, with Tesla, it's been doing okay. Of course, Tesla got close to that 450 target, 445, and it's sitting around the 420 430, which is currently the level of support, but we'll look at that in the charts in a moment. And Nvidia is in the middle of nowhere. So, it's not it's not like super weak, it's not super strong. It's just sitting in the middle of that zone.
Now, maybe more interesting were, of course, the options markets on Bitcoin last 24 hours. Lots of people loading puts all over the 62 60 63 market for IBIT. And what this is suggesting that if the markets continue to go down and of course Bitcoin loses this level, it could be kind of like one of those flash sells that that goes pretty quickly and then all of a sudden, you know, we could be looking maybe even could it be under 100K. Now, it doesn't really change my opinion on the fact that I think Bitcoin is going to have another resurgence, but at the same time, this does open up some stop-loss hunts to to go through, and we'll look at those soon on the charts.
For gold, it's still pretty green and still pretty good. So, gold, silver, two of our favorites here on the channel. They've been doing very nicely over the last 24 hours.
So, just before we jump into the charts and we take a look at the key levels that you need to be watching right now in markets, I want to say a big thank you to the sponsor of today's video, which is Tiger Brokers. Now, you you guys know we've been working with Tiger for a long time, and they've always offered extra specials for members of the FX Evolution audience. Those links are in the description down below, but I want to talk a little bit about why we like Tiger Brokers. And it's not just that they're winning plenty of awards for so many different areas and things. it's that they constantly reinvent their platform to make sure there's extra features for you based on feedback actually from members of this community and at the same time they compete on the scale of all of the different platforms out there to make sure that they are if not the best one of the best in pretty much all of the different aspects.
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All right, guys. Let's have a look at the 2-year here. What is going on? Well, you can clearly see that we've got a rising up 2-year yield. And you might be left scratching your head saying, "How's this possible?" As I often say, if it's in the press, it's in the price, guys. Look at this. As soon as we get that Fed cut, it starts moving off into the other direction. And you might say, "Well, how's this possible? The Fed have said they're going to probably do more cuts, and we expect tons of cuts." Don't worry about that too much. Just remember though that it's when everyone crowds a certain idea that often it starts to break. Does that sound familiar right now? Well, it may because AI is doing something very similar right now where everyone's crowding the idea, leveraging up, and of course, all of a sudden, boom, you get that kind of a bit of a sell-off. That doesn't mean it's over, but it does kind of like, you know, jolt everyone's opinion.
At the same time, everyone's hated energy stocks for a long time, as have I. Uh but that changed about 2 weeks ago or 3 weeks ago when we started to go, you know what, this starts to look a little bit better here. There's a really strong daily close. We'll see whether it can get the weekly close here for energy stocks. But certainly an improvement here in energy. And that's suggesting that maybe there's more to come. Um maybe there's more information to come as well over the next couple of days and that could cause those stocks to be very interesting indeed. What about ARK? Obviously, there's always risk guys. Please be protected and make sure you make your own decisions.
Now, what about ARK? Well, you can see here the market rallied up. That is, of course, an upward trend. Still is. And then it hit overbought and it's kind of sold off a little bit. Back to the daily 20. Is it probably a buy yet? I don't know if it's another buy yet. I think it's probably not done enough to really kind of justify that, but certainly you can see it's coming back to that first little level of support.
Now, what about the dollar? While the US dollar absolutely nailed that first level we talked about 98.110 in the last chart. We basically talked about how once it breaches this it's probably going to keep going to this area and it's hit now the most traded zone. Now this is huge because basically this is against again if it's in the press it's in the price. Most people would have been shorting the dollar and the trend was of course down but that changed around here. Now I'm not sure what the dollar exactly will do from here. I think it's such an important point that we need to be watching all of the small time frames. If I had to guess, I'd usually be going with dollar weakness still. Uh but at the same time, if it blasts through 98.75, this is going to be, you know, further strength and all of a sudden we have to look at the next levels. I think the good thing here is we can use price and structure to understand it's a very important level and we now need to see the evidence for the next big move. That was probably the more logical move. Now we've hit it. You'll see in the last video. It's exactly what we said. This now that we've hit it, we need to look for the next kind of zone and area.
Now, what about gold? Well, it didn't really care. It held its own versus the US dollar, which is pretty impressive for the shiny metal. Gold still bullish. And silver, my goodness, this thing is going well. Wow, it is smashing my expectations of how fast I thought silver would move up. You guys know I've been a big bull since the 20s, but at the same time, this thing is $45. I thought we might take a little breather at 43, 42 and now we're going towards all-time highs. You know, that 48 mythical 50 level for silver. So, really strong. You can't say that's a bad looking chart. So, you'd just be basically bullish on that chart.
Now, here's where things get interesting. Our analysis onto oil. So, if you were brave enough to get into a long in here and stop down here, then you survived. And well done to you, by the way. I'll give you a clap, guys, because not easy, you know. I I probably would have gone not looked at the screen, but that's the easiest way. But if you were watching it, you would have been probably a little bit scared down here. Either way, oil did actually change trend before that a little bit on the smaller time frames for speculators. And now it's put in kind of the beginnings of a double bottom and of course a larger double bottom coming up at 66. Oil suddenly the talk of the town the last session or two. So this is a very interesting thing. I'm actually going to be watching it very closely and of course already so seen it in the stocks. So the stocks have already improved there a little bit. Semiconductors actually did better than you'd think over the last 24 hours. You can see here 3.21 for semiconductors. So yeah, interesting kind of rally there. And Nvidia stuck within its range. Remember, for the bull market to really continue on, at least in my opinion, we're going to need an 80 185 from Nvidia. If that happens, okay, probably risk back on. Market's going to make new highs, all of that stuff. But it's stuck at the moment within a range. So I would say neutral down is the current market condition.
Tesla did fall a little bit, still dull. Very difficult to kind of look at any particular level after such a huge move. You guys know we were all about the positive gamma. It went to 400 plus faster than any of us thought so. And now we're in a dull style market. So, makes sense. It's having a breather. It It can do its own thing, though. So, with Tesla, I'd probably take it with a grain of salt at this stage.
US 2K, what is going on there? Well, the market fell. And again, you're going to hear the same thing. it hit the daily 20 moving average. If we lose this level, what's more likely? The potential for a weekly 20 moving average and that's going to sit actually all the way down here at 22.90 by the time they touch each other if that does happen. So, is it pretty normal for it to do this? Well, go through history and again you'll see last time because this is actually the most interesting time. We hit it twice and then it went absolutely bonkers. So, I'm not to say that this is the end for the Russell. In fact, when the Russell makes a new multi-year high after doing nothing for a while, this is usually very good sign, but it can create weakness at least initially. So, that's kind of the data and the stats that we're seeing at this stage.
NASDAQ, same thing. Didn't quite touch the 20, but it did touch the first level of demand. So, again, weakness, not um not, you know, unusual or anything like that. We'll be watching the US 500 very closely over the next 24 hours into the weekly close and Bitcoin weakened off more actually dropping below 111 and now sitting at 109. So I think I think we clearly know where the bulls are back in control closure above 113.5 that's going to be super strong now. Um that's the evidence there is is really good but it is possible that Bitcoin can fall further and the reason is maybe more in Ethereum which dropped below 4,000 over the last 24 hours and you can kind of see here there's nothing much holding up Ethereum. You might say but Tom look the previous resistances they're holding it. Yeah, I'm not sure about that one guys. I don't really like that. Maybe past 4200 Ethereum is back on. But for now, I think the bears are kind of in control of this market and they could push into, of course, these levels.
Now, if we get a 3,400 on Ethereum, we might be looking at a Bitcoin that's getting down into that 100. So, if it gets like a 98k swipe on Bitcoin, like goes down, then of course goes back up, then that's going to be a very critical point for the crypto markets. But things are still looking again good into the end of the year. At least the way I'm looking at it currently with the evidence that we've got for the rest of the week. It's pretty much all about Friday, guys.
But do remember if you're interested in finding out more about the sponsor of today's video, Tiger Brokers. Check out the links and pin comment down below to see whether they're the right fit for you. And of course, we always appreciate it when you do check out our sponsors. It does help us out as well. If you enjoyed today's video, please remember to subscribe and of course smash that like button. Also, we'll be coming at you with the weekend video. These weekly closes will be super important. Follow more on X. If you have questions and of course you want to interact with some of these charts and some of the things we share, check me out on LinkedIn as well. And if you're interested in finding out more about how we replicate these models, how we've picked these macro big stories of the last couple of years, then you can check out our advanced masterclass. Guys, thank you so much. You have a fantastic Friday. Have a fantastic start to the weekend. And we will see you in the next video. Bye for now.