Trading Desk

We went short SPX before the war started, called the bottom when SPX was trading around 6370, and warned of significant upside risk should a ceasefire deal be reached before Tuesday’s deadline. We turned bearish again this Thursday, shorting near the highs. I also posted an article on X yesterday regarding the U.S.-Iran negotiations. View the translated version here.

A clean breach above the downtrend resistance around 6870 (ES1! = 6910) should invalidate my downside thesis and open the door to new ATHs. The risk-reward on this setup is too asymmetric to ignore.

NIFTY (Nifty 50) bounced off my 22K support.

SOXX If de-escalation is in order, semis should continue to lead higher, just as bellwether sectors usually do when markets emerge from a correction or bear market.

XLF (U.S. Financials ETF) is back above the key 50 level. If it manages to hold above it for the next few sessions, we should see it head higher.

MSFT (Microsoft) could be forming a double bottom, the inverse of the double top that led to its 40% decline over the past six months.

XAUUSD Gold faces significant resistance around the 4770 level.

It has attempted to thrust higher since Wednesday, but could not hold above 4770 into the close.

A clean break above this key resistance will open the door to more upside.

If it starts to reverse from here, the major trendline around 4.1K comes into play.

SPX was rejected, XAUUSD was rejected, US02Y yields are trying to reclaim 3.8%, and DXY is not letting 99 go. Most importantly, CL1! seems to be building a base around 92-94. If it starts to take off from here, gains from the last two weeks could be wiped out very quickly.

Market reaction to the ceasefire headline is exceedingly positive, just as I warned before the market closed yesterday. Note that CL1! reversed exactly at the multi-year resistance I gave out when the war started. CL is now sitting on a very important support. Despite the impact of the ceasefire deal, CL remains in a bull trend so long as it stays above 94. SPX is set to open around 6.8K, which is a very important pivot to reclaim if it aims to head higher. NDX is set to backtest the major trendline from below as well. $DXY below 99 and US02Y yields below 3.8% are both supportive of equities and gold. Whether this two-week ceasefire turns into a permanent ceasefire or a two-day ceasefire remains unknown. Price action will be telling: a break above SPX = 6.8K and NDX = 25.1K, coupled with DXY below 99 and CL below 94, would suggest a genuine will to cease fire. If price struggles to break through, it may suggest otherwise.

VIX Unless VIX (Cboe Volatility Index) breaks below the uptrend line support from late last year, we're not out of the danger zone yet.

NVDA As warned, NVDA (Nvidia) left a fakeout before bouncing higher. This is common, especially for key names such as NVDA, which is the bellwether of the bull run, as bulls and algos will do their best to defend it. However, I do think this is just a relief rally before it reverses and breaks below the key 167 support level.

SPX rallied more than 3% this week, shattering many bears. I called a ST bottom at last Friday’s close, and ES rallied more than 200 handles from there. I also called a ST top before Trump’s address to the nation on Wednesday night, which caused a sharp selloff in equity futures, with ES dumping 150 handles from the top before reversing. Despite the sharp rally and a resilient tape on Thursday, the structure remains inherently bearish. So far, this rally appears to be nothing more than a bear market rally, which tends to be very forceful and can drive out unconvinced bears before reversing lower. Note that SPX volume on Thursday was the lightest it has been since 01/02/26, which suggests a lack of strength and conviction behind the rally. Our downside target remains around 6.1K.

NDX was rejected at the key 24.2K resistance. This relief rally appears to be a backtest before heading lower.

XAGUSD Silver bounced from its major trendline support last Monday and pulled back from the dotted trendline resistance.

If it does not climb above the dotted line, it risks heading lower.

US30Y (U.S. 30-Year Treasury Yield) left a fakeout before reversing lower back below resistance this week. It remains a key asset to monitor, as a confirmed breakout would bring devastating consequences for global equities.

Z1! reclaimed the major trendline and now sits around the horizontal resistance near 10.5K. If it fails here, we would likely see a retest, if not a break, of the major trendline. If it manages to break above and hold the 10.5K level for a few days, we would likely see it move higher.