• ...It isn’t participation that creates volume; it’s disagreement that creates volume...
• ...All trends start with anomalies, and every trend must break through a threshold...
• ...The motivation to act is that the former isn’t all that good, not that the latter is especially good in itself...
• ...You can’t get far on one leg...
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Zero. Introducing actual trading volume
CMX silver (daily chart, as of 260712), raw volume
CMX silver (daily chart, as of 260712), actual volume (colored according to volume imbalance)
Starting today, the Planet will gradually introduce the volume component of the relationship between price and volume. New friends, don’t rush; this is a gradual process. First, get a clear understanding of price, Don’t touch volume before you understand price。
For volume and orders, aggressive and passive trades have different significance. Passive trades are meaningless for judging direction, but essential for judging magnitude. You can’t see the chain reaction in aggressive trades, but they are the core expression of incremental behavior. What matters for pricing is the incremental behavior of marginal actors...
The two should be considered separately.
Buying, selling, and holding in the market are, at their core, adjustments of target positions relative to existing positions; in other words, the three actions are simply three outputs of the same function. People’s psychology, thoughts, greed, fear, identity, defensiveness, imitation, discipline, redemptions, leverage, and liquidity constraints enter into prices only when they change target positions or the urgency to trade.Price records the traces left by changes in marginal positions; volume records the intensity of action, the capacity of counterparties to absorb trades, and the scale of disagreement.It isn’t participation that creates volume; it’s disagreement that creates volume.
The community website is under development, and its features will be launched gradually. Once it is up and running, we will also invite some creators to produce content together there (initially, participation will be by invitation only). Community members who are interested in writing something can contact her to join once it launches.
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One. Macro trading positioning
Image: Macro Drivers positioning chart
Gold-edged dots indicate movement toward the upper right (as of 260712)
A trading week driven by US–Iran noise. Reflation has mainly been driven by oil and G10 FX; it is still in the lagging region and does not count as a genuine narrative. For now, it continues to be treated as noise.
Red indicates unanimous bearish positioning, green unanimous bullish positioning, and gray disagreement; dots with gold outlines indicate movement up and to the right (as of 260712)
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Second: Technology Trades
Chart: The Korean index, a technology leader, broke down and moved lower right on schedule, as we expected
KOSPI (daily chart, as of 260712),The short position’s take-profit level has been moved from 8620.17 in last week’s weekly wrap to 8051.35
Drawn by Gold Line Planet three weeks ago, Since we closed out our position, the Korean index has broken down on schedule and continued moving lower.
See“26-06-28 Weekly Review — Ari's Weekly Wrap”》
Chart: The range is taking shape; the purple rectangle has been tested
SOXX (daily chart, as of 260712) has continued moving lower since we exited; the purple rectangle is taking shape, and the long and short price levels should not be moved
As we said in the previous weekly wrap, seeing a purple rectangle should make us cautious. Midweek this week, the purple rectangle was successfully tested and confirmed to be valid (on Tuesday, price pierced the bottom of the rectangle precisely and rebounded);The dividing line between bulls and bears has moved from 638.49 to 608.13. We are maintaining our view: before Q2 comes out, price will not truly break below this rectangular area. At most, it will oscillate near the lower edge and wait. Neither shorting nor going long here offers a favorable trade; we should wait patiently for the market to confirm.
Chart: The structure of the US dollar index is clearer
SPX (daily chart, as of 260712)
Since we took profits on the index longs at 6.3, SPX has not once broken through this key level separating bulls and bears Likewise, a purple rectangle is taking shape, and we are maintaining our view; the outcome will be confirmed at Q2, An upward path is more likely and is more consistent with my expectations... Note that this is said from a bearish perspective. A genuine move lower needs to be rooted in a renewed upward climax.
From a volume perspective, trading has now turned bullish and volume has expanded, bringing price very close to the bull-bear line. Once it breaks through, the US session’s upward move will resume.
...
So far, AI trading has gone through six rolling phases: US hyperscalers led the way in 24; winners were revalued following DeepSeek at the start of 25; Asian semiconductors and Korea’s IT took over; data center delays, cloud companies’ financing, and spending commitments from private AI companies; bottlenecks in memory supply and pricing; and now the market is beginning to question the zero-sum nature of AI buildout, as crowded winners face profit-taking...
The key lesson to keep firmly in mind here is:Profits in one part of the chain may become costs in another; the entire AI chain must never be treated as a single trade.
Chart: Some other charts
SK Hynix (daily chart, as of 260712) has continued moving lower since profit-taking
SK Hynix, after taking profits and exiting, has continued to fall ever since, - ~19%.
50 STAR Market (daily chart, as of 260712)
50 STAR Market: after taking profits, the stop-profit trigger switched the position back to long; the stop-loss level is marked by the red line.
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Three. Global equities
Figure: positioning map
Red indicates unanimous bearish positioning, green unanimous bullish positioning, and gray disagreement; dots with gold outlines indicate movement up and to the right (as of 260712)
Ranking of gains over the past week (260712)
Keep an eye on unusual market moves and regime shifts yourself, What matters is the 1) marginal change and the 2) threshold.
Every trend starts with an anomaly, and every trend must pass through a threshold breakout.
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Four. U.S. equities market
Figure: positioning map
Red indicates unanimous bearish positioning, green unanimous bullish positioning, and gray disagreement; dots with gold outlines indicate movement up and to the right (as of 260712)
Ranking of gains over the past week (as of 260712)
Over the past two weeks, the market has absorbed very well the extreme rotation in popular stocks and momentum factors AI; micro-level turbulence has been almost invisible at the index level, This is what we were saying 3 weeks ago, when we turned bearish on a group of technology proxies including KOSPI: long-only capital will not want to leave; it can only keep rotating within the market, looking for other baskets to trade back and forth. Once it can no longer find consensus elsewhere, it will return to AI to make another high. That high will be the true peak.
“If the matrix of the indices and technology sector breaks upward, capital will flow back into technology and, from the bottom up, deliver another round of climactic gains; if the market keeps oscillating without breaking down, new baskets will rotate in one by one to absorb capital; if the new baskets cannot absorb it and technology also loses momentum, the entire U.S. equity trade will come to an end.”
As for buying the dip, Nasdaq futures positioning makes it clear: in the first week of 7, Non-Dealers bought 158 hundred million dollars, their largest nominal purchase since 2020 10, with 138 hundred million dollars in new longs; Asset Managers added 51 hundred million dollars in longs and covered 17 hundred million dollars in shorts; Hedge Funds bought 79 hundred million dollars; Non-Reportable accounts added 25 hundred million dollars; and Other accounts sold 14 hundred million dollars, making them the only net sellers;The buying took place while the Nasdaq was down 3.6% and High Beta was down 21.4%, making it a countertrend increase in exposure.
On one side, capital is retaining AI, momentum, and mega-cap cloud companies with the ability to deliver earnings; on the other, it is starting to allocate to value, capital-intensive assets, resources, industrials, energy, and reflation laggards. But the motivation for this action is that the former are not doing as well, rather than that the latter are doing especially well. It is important to understand this distinction; the motivation for action precedes capital flows. If you watch capital flows, you are watching the result.
...
Finally, since the decision whether to move up or down rests with Q2, it is clear that the market from here will be driven by earnings divergence, not simply by factor rotation. Apart from Pure AI, whether those HALO assets can gain strong market acceptance is also something to watch.
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Five. China market
Overall, the China market remains the most trading-friendly, a beginner’s area by global standards. As usual, first an update on the indices, then a deeper look at baskets, and finally at micro-level proxies.
Figure: Hang Seng Tech and internet stocks
Hang Seng Tech is trading in this purple rectangle, not along the descending gold line (Original post）
HSTECH (daily chart, as of 260712)
Take-profit level moved slightly higher, Reversal trades need to be moved above cost as quickly as possible to keep yourself safe.
KWEB (daily chart, as of 260712) A quick update: this is not a pattern, just following the fluctuations.
...
The chart for STAR 50 was discussed earlier in the tech column; what needs to be added here is why domestic AI trading has continued to outperform global markets recently.
The performance of top models is approaching a key inflection point. With the pricing of new models continuing to surge, smaller parameter counts and new architectures achieving comparable performance under tighter computing constraints will become a focus for capital. For most tasks, greater intelligence means an increasingly smaller pool of demand (in human work, the demand curve for high intelligence means that the greater the intelligence, the less of it is actually needed). The truly large-scale applications are not in the market for Fable 5, nor in the market for GPT5.6 Sol xhigh&max. What is bound to happen—and is already happening—is that the market will split into two tiers...
Performance is one thing, but as validation with real money becomes increasingly important, relying on Capex alone is gradually becoming untenable. That is not to say Capex is unimportant; rather, because we know it matters, we need to shift our focus, at least in part.
You cannot get far on one leg. Rising expectations for capital expenditure mean the risks here will become increasingly fragile. The only other leg that can be validated is actual application—that is, how much of this AI economic value can ultimately be truly converted into shareholder returns and applications also mean looking to China. Chinese people are the best at putting things to use, and the Chinese market is also pivotal when it comes to applications. The lessons from the internet a few years ago, and from the globalization (and China expansion) of a group of American consumer companies led by Coca-Cola more than a decade ago, were already deeply embedded in the minds of those Wall Street decision-makers back when they were studying business at university.
It is no surprise that media outlets controlled by these funds will soon shift the focus of the debate over AI trading from whether Capex is excessive to whether corporate adoption is outpacing supply growth.The average price of output tokens in the US and Europe has already risen to 12.89 dollars per million tokens; the average price for frontier models is 8.99 dollars. The world needs China: it needs China’s low-cost capabilities, its large market, and its hardworking and courageous people. (Data-center construction in the US and Europe continues to face strong opposition from local governments and unions, labor shortages, and equipment constraints. Many projects originally planned for 4 Q26 have broadly been delayed until 2 Q/3 Q27.)
Chart: Momentum environment and tradability
CN Momentum Environment (as of 260712) Above the green line is our home ground; above the yellow line, we can keep trading. Below the yellow line, and especially below the red line, is our weak zone—avoid it.
Chart: Rotation regime monitoring based on Chinese-market baskets
Rotation Regime (as of 260712) The green line shows the strength of the leading theme, the yellow line shows the speed of theme rotation, and the Histogram shows the marginal loss of momentum in theme strength. High strength and slow rotation make for a very favorable trading environment.
Figure: positioning map
Red indicates unanimous bearish positioning, green unanimous bullish positioning, and gray disagreement; dots with gold outlines indicate movement up and to the right (as of 260712)
Baskets moving toward the upper right (as of 260712)
Constituent stocks moving toward the upper right among the Baskets moving toward the upper right (long-side basket filter) (as of 260712)
...
Ranking of gains and losses over the past week (as of 260712)
You can make money in both bull and bear markets; what you cannot make money in is a market without logic. Without logic, prices cannot develop naturally; without natural price development, there is no trend. Profits come only from smooth trends, whether long or short.
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Six. Precious metals
Chart: Gold
CMX gold (daily chart, as of 260712)
First, the long-short line held precisely; second, the close once again landed exactly at the T1 target price. There’s not much more to say. There are many things you shouldn’t be unaware of: why prices move, why they stop, and where they stop. Others on the outside don’t know.
In an earlier weekly note“Precious Metals: Gold, Silver, Platinum & Trendline Drawing and Tacit Knowledge”
Once prices start moving, price alone determines what happens next. All news before a break of an important key level is old news; all events are just “picking up shit” (ultra-short-term scalping, picking up sesame seeds and losing the watermelon). Profits come only from the places worth taking a position. You can make very clear judgments about the microstructure and direction at an extremely granular level, but that doesn’t mean you have to trade all of it. Sitting well: every effort must demand an outsized return.
Chart: Silver
CMX Silver (daily chart, as of 260712)
Silver, likewise, was once again stopped to the last fraction of a point at the gold line.
Just keep a close eye on price; there’s nothing else to say.
Chart: Platinum
NYM Platinum (daily chart, as of 260712)
Chart: Palladium
NYM Palladium (daily chart, as of 260705)
Among gold, silver, platinum, and palladium, platinum and palladium are closer to their bullish reversal levels, but this would be an aggressive bullish reversal, without the confirmation from gold and silver (especially silver)Cross-confirmation Going long beforehand would have been very likely to end in a loss. We offer this cautious risk warning: those waiting for the major rally can wait for cross-confirmation; it won’t be too late. Turning bullish here requires a high level of skill.
Seven. Alternative Assets
Xiao Huang (daily chart, as of 260712)
The bulls have reclaimed a key short-term level, A break below the red line will signal that the bullish reversal has failed (note the SO filter)。
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Eight. Soft Commodities (El Niño): Cocoa, Coffee, Soybeans, Raw Sugar, Rice
Another successful bet this year.
Chart: Cocoa, breakout
Cocoa (daily chart, as of 260712)
Broke through as expected; since turning bullish again, +~50%. Over the past week, many institutions have started studying the relationship between El Niño and cocoa and coffee. By the time they started looking into it, we had already made a fortune. Stay humble and level-headed; keep a rational perspective.Trading is a very boring activity; entertainment belongs outside the market. The more money you make, the more humble you should be—try to keep yourself as close to the ground as possible.
Chart: Take-profit level moved higher again & principles for using ATR and the logic behind setting its level
Chart: Coffee, broke above the upper boundary
Coffee (daily chart, as of 260712); take-profit level moved higher
The bottom-pattern reversal trade mentioned in last week’s weekly report, As of this week, it has moved up from the bottom of the trading range and broken above the upper boundary; the take-profit level has been moved higher again, to above 300.
Chart: Soybeans, broke above the upper boundary
Soybeans, The plan from the previous weekly report
Soybeans (daily chart, as of 260712)
Broke through as expected, and the trading range widened. The intraday gain on the breakout day was the largest in nearly 3 years;To others, the words “broke through as expected” are a boast. For us, it is business as usual; there is no need for emotionally charged language. Behind it are the calm and restraint of firm execution. We have no crystal ball and cannot predict the market. All we can do is make the best plan we can, then execute it strictly, with clear grounds for entering and exiting.
Chart: Raw sugar
Raw sugar (daily chart, as of 260712)
The three contracts continued to hover around the expected two white lines, and the weekly close was precisely on the white horizontal line.
CANE (daily chart, as of 260712), closed precisely on the white line
COFCO Sugar (daily chart, as of 260712)
The structure is the same in every case.
...
Chart: Rice
Rice (daily chart, as of 260705)
Rice continued to rise, approaching the T1 target price; the take-profit level has been moved higher (see the red line on the chart)...
Detailed fundamentals for soft commodities See last week's weekly note No need to repeat anything unnecessary.
A few additional points:
1) El Niño is more likely to create relative inflation and policy divergence. Food typically accounts for 10%-15% of the CPI basket in developed markets CPI, and 25%-50% in some emerging markets; a rise in food inflation of 1% could contribute around 10-15bp and 25-50bp CPI, respectively. India, Southeast Asia, Australia, southern Africa, and northern South America are typically drier, while Peru and Ecuador face risks to infrastructure and fisheries from flooding. Brazil and Argentina could benefit from increased rainfall. Falling water levels in the Panama Canal could compound disruptions to shipping in the Middle East. Major commodity routes include rice, cocoa, coffee, sugar, and palm oil.
2) The two approaches used in El Niño research diverge. Markets may correctly predict the weather but misprice the second-order effects—a highly tempting narrative that is ultimately difficult to trade. Increased crop yields across regions can offset reduced yields elsewhere, and historical events have generally not pushed up global food prices; risks are greater for soft commodities with concentrated supply. An 1.0°C shock raises the peak in global wholesale food prices by 9.55% two years later; if this episode reaches 1.65°C, the cumulative increase could reach 15.8%. The euro area's food, alcohol, and tobacco price level would rise by around 1.3%, and overall inflation would then increase by around 0.1 percentage points in each of the following two years.
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