Sunday’s lean went on at Tuesday’s close by half a point, and it’s offside tonight. The stop stands where it was published. Settle 7,643.75.
The drip under the pivot has a reason, and it isn’t September and it isn’t fear. Crude’s up better than 13% in a month, Brent crossed $100 for the first time since July, and the futures market now leans toward the Fed hiking on the 16th instead of holding. That’s a repricing of the path, not a growth scare, and it explains why the index can bleed for two sessions while credit sits near the best readings of the year and the index still holds 6.8% above its 200-day trend.
Underneath it, the shape hasn’t changed. This is the fourth straight week of lower highs into a low that keeps getting tested in the same place, and the tightest weekly range of the four. You’ve been looking at it every week.
The part that should bother you: the volatility market hasn’t marked any of it. Volatility’s at 16.46 with the curve in healthy contango and the front month a point over spot. That’s a market that expects this to end at the inflation print.
Below the fold: the six prices for Thursday and Friday, the four-week shape nobody’s naming, what we’re doing with the call spread now that it’s a long shot, the one sector that’s actually working, and the two branches for Friday.
