The markets say mixed

USD: Mar '26 is Up at 97.135.  

Energies: Mar '26 Crude is Up at 63.95.

Financials: The Mar '26 30 Year T-Bond is Lower by 7 ticks and trading at 117.25.

Indices: The Mar '26 S&P 500 emini ES contract is 144 ticks Higher and trading at 6895.00.

Gold: The Feb'26 Gold contract is trading Up at 4946.20

Initial conclusion

This is not a correlated market.  The USD is Up and Crude is Up which is not normal, but 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 Higher and Crude is trading Higher which is not correlated. Gold is trading Higher which is not correlated with the US dollar trading Up.  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. Asia traded Higher except the Shanghai exchange.  Currently all of Europe is trading Higher.

Possible challenges to traders                                                  

• Durable Goods m/m is out at 8:30 AM EST. This is Major.
• Core Durable Goods is out at 8:30 AM EST. This is Major.
• Building Permits is out at 8:30 AM EST. This is Major.
• Housing Starts is out at 8:30 AM EST. This is Major.
• Capacity Utilization Rate is out at 9:15 AM EST. This is Major.
• Industrial Production m/m is out at 9:15 AM EST. This is Major.
• FOMC Member Bowman Speaks at 1 PM EST. This is Major.
• FOMC Meeting Minutes is out 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 data to speak of.   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 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 - 2/17/26

Dow - Mar 2026- 2/17/26

Bias

Yesterday we gave the markets a Downside bias as it was correlated in that direction.  The Dow climbed to a gain of 108 points, but the other indices fell on the day.  Today we aren't dealing with a correlated market, and our bias is to the Upside.

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

Commentary

The first day back after a major holiday is always filled with the unknown as the markets could go in any direction.  The markets are typically confused and usually maintains a pause before committing to a particular direction.  Want to learn Market Correlation and determine market direction hours before the Opening Bell?