Yesterday makes day four of mixed days

USD: Sept '25 is Up at 98.540.  

Energies: Aug '25 Crude is Up at 67.05.

Financials: The Sep '25 30 Year T-Bond is Higher by 7 ticks and trading at 113.12.

Indices: The Sep '25 S&P 500 emini ES contract is 70 ticks Higher and trading at 6439.75.

Gold: The Aug'25 Gold contract is trading Up at 3322.80.

Initial conclusion

This is not a correlated market.  The USD is Up and Crude is Up which is not normal, and the 30 Year T-Bond is trading Higher.  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. All of Asia traded Mixed.  Currently Europe is trading Mixed as well.

Possible challenges to traders

• Goods Trade Balance is out at 8:30 AM EST.  This is Major.

• Prelim Wholesale Inventories m/m is out at 8:30 AM EST.  This is Major.

• HPI 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.

• JOLTS Job Openings is out at 10 AM EST.  This is Major.

• CB Consumer Confidence is out at 10 AM 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 AM EST with no news pending.  The Dow dived Lower at the same time.  Look at the charts below and you'll see a pattern for both assets. The Dow dived Lower at 8 AM EST and the ZT climbed Higher 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 ZT is now Sep '25 and the Dow is now Sep '25.  I've changed the format to filled Candlesticks (not hollow) such that it may be more apparent and visible.

Charts courtesy of BarCharts

ZT -Sep 25 - 7/28/25

Dow - Sep 2025- 7/28/25

Bias

Yesterday we gave the markets a Neutral or Mixed bias and the markets didn't disappoint.  The Dow and S&P both lost ground but the Nasdaq gained 67 points.  All-in-all a mixed day.  Today we aren't dealing with a correlated market, and our bias will remain Neutral or Mixed.

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

Commentary

So yesterday despite Trump's claim of a stupendous tariff agreement with the European Union, we witnessed another Mixed Day and this was the fourth mixed day in a row which says the markets are undecided as to what will happen in the near term.  This week we have an FOMC Day and Jobs Friday so it will be an interesting week, no doubt.  I personally don't think the Fed will cut rates, but we could all be in for a surprise.  Bottom line, time will tell.  Want to learn Market Correlation and determine market direction hours before the Opening Bell?