Markets up despite storm

USD: Mar '26 is Down at 96.755.  

Energies: Feb '26 Crude is Down at 60.61.

Financials: The Mar '26 30 Year T-Bond is Lower by 1 tick and trading at 115.26.

Indices: The Mar '26 S&P 500 emini ES contract is 88 ticks Lower and trading at 7003.25

Gold: The Feb'26 Gold contract is trading Down at 5069.00.

Initial conclusion

This is not a correlated market.  The USD is Down and Crude is Down which is not normal, and the 30 Year T-Bond is trading Lower.  The Financials should always correlate with the US dollar such that if the dollar is Higher, then the bonds should follow and vice-versa. The S&P is Lower and Crude is trading Lower which is not correlated. Gold is trading Lower which is not correlated with the US dollar trading Down.  I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open. All of Asia traded Lower except the Aussie Dow and the Hang Seng.  Currently all of Europe is trading Higher.

Possible challenges to traders                                                  

• ADP Weekly Employment Change is Tentative. This is Major.
• HPI m/m is out at 9 AM EST. This is Major.
• S&P/CS Composite-20 HPI y/y is out at 9 AM EST. This is Major.
• CB Consumer Confidence is out at 10 AM EST. This is Major.
• Richmond MFG. Index is out at 10 AM EST. This is Major.
• President Trump Speaks at 2 PM EST. This is Major.

Traders, please note that we've changed the Bond instrument from the 10 Year (ZN) to the 2 Year (ZT).  They work exactly the same.

We've elected to switch gears a bit and show correlation between the 2-year Treasury notes (ZT) and the S&P futures contract.  The YM contract is the Dow Jones Industrial Average, and the purpose is to show reverse correlation between the two instruments.  Remember it's likened to a seesaw, when up goes up the other should go down and vice versa.

Yesterday the ZT climbed Higher at around 8:30 AM EST with no real economic reports.   The Dow dived Lower at around the same time.  Look at the charts below and you'll see a pattern for both assets. The ZT climbed Higher at around 8:30 AM EST and the Dow dived Lower at around the same time.  These charts represent the newest version of Bar Charts, and I've changed the timeframe to a 15-minute chart to display better.  This represented a Long opportunity on the 2-year note, as a trader you could have netted about a dozen plus ticks per contract on this trade.  Each tick is worth $6.25.  Please note: the front month for the ZT and YM are both Mar '26.  I've changed the format to filled Candlesticks (not hollow) such that it may be more apparent and visible.

Charts courtesy of BarCharts

ZT -Mar 26 - 1/26/26

Dow - Mar 2026- 1/26/26

Bias

Yesterday we gave the markets a Downside bias as the markets were correlated that way, but the markets had other ideas and the indices veered to the Upside.  The Dow gained 172 points on the session, and the other indices gained ground as well.  Today we aren't dealing with a correlated market, and our bias is Neutral or Mixed.

Could this change? Of Course.  Remember anything can happen in a volatile market.

Commentary

Over the weekend we got buried in a massive snowstorm, the like of which we haven't seen in years.  The markets still migrated to the Upside today.  Want to learn Market Correlation and determine market direction hours before the Opening Bell?