Now that bond prices are bullish, it's clear that investors are eyeing lower interest rates soon. The 10 year note has been steadily bullish for some time. With a slowing labor market and lower projected yields this year, treasuries could be seeing some more upside.

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Yesterday, the NASDAQ posted its record day for the year moving up 4% in one day. Now the tech index is testing resistance around a key resistance level that was one of the levels I marked earlier this week. Although yesterday's move was pivotal, we are now at the decision level.

With strong earnings and dovish comments from the Fed, there may be enough fuel to break above this level which could suggest another test towards the early July highs. As we start a new month today, it's hard to say how much further the market can run from here. I would still air on the side of caution to either side of the trade. There are likely good longs and shorts in this market, depending on the zone and the sentiment. -Frank

Blue chips look stronger than the rest of the indices still. As yields drop, keeping money in assets like bonds is becoming less attractive. Once we see that first rate cut, it could spark more demand in the stocks that will likely perform well and provide a dividend yield on top of that.

We are still 7% off the highs of NAS, 1.3% off the highs from DOW. There is still a long ways to get back to the highs, but a return to these highs is definitely not impossible. The bears may have lost ground and will retreat for now, so the pullback could be the dip buying opportunity that investors wanted.

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SPX500 and RUSSELL are long according to retail. NASDAQ and DOW and Gold are mixed however. Seeing that USOil is the top longed asset suggests that there may be further downside.

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The DOW remains bullish from COT reports while retail is still less optimistic on the value plays. The divergence may suggest that there is more upside for the index.

Looking at our latest fundamental tool, the business forecast shows us a variety of economic and monetary metrics. We're looking at interest rate forecasts for the future which are looking dovish. Starting Q4, it seems that the first rate cut will happen and there will be some relief to the consumer.

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NAS100 fell through the 200 SMA on the 1D timeframe and has almost pared losses from pre market. The index is going to have to hold above the 200 day, otherwise we could see further lows. The next level of support is at $17,000, and below that is $15,900s.

With earnings this week, we could see growth in demand for the tech stocks, however, we need to cautious of a false rally. That all depends on which side of the moving average that the market closes.
-Frank

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Gold prices fell with the rest of the market, but the metal could act as a hedge against the dollar should yields continue to fall. If we are truly going to see a slowdown in the US economy, it would make sense to see gold rush higher.

The problem is that gold is moving almost in tandem with the rest of the US indices. Lower yields should be a healthy sign for the metal, but it's not really making much of an impact yet. There could be a catch-up bounce if the yield continues lower. A major concern I have in these markets right now is that if we are experiencing a real crash, everything will fall, including gold.

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EURUSD, SPX500 and USDCAD are being shorted by the retail crowd. Meanwhile, they are buying up USOil, Silver, RUSSELL, Gold, NIKKEI and NASDAQ. All of these are pro-risk sentiment. But I think we are experiencing more of a risk-off environment.

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The Russell saw an increase in net long positions from last week's COT report. All of the indices are in the blue today in terms of bullish positions, so smart money is still trying to position into the indices.

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The gradual tick up in unemployment is finally weighing down on investor sentiment and the economy. There is not necessarily any bullish news right now, so any kind of rally seems to lack foundation. Until inflation next week, we may not see any relief. The jobs market is breaking and the Fed decided to keep rates unchanged. Investors think the Fed will have to step in in a big way to counter act a breaking economy.

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Small caps fell to their 200 day moving average on IWM shares. Price opened and closed below a supportive trend line on the 1D timeframe as well. The question remains whether price can hold up around this support. The break in the trend suggests lower moves over time, although the index could run back up to test the trend line beforehand.
-Frank

Gold Daily Chart:

Price continuing lower today, and looking it might be setting up for another test of support around 2360.

I will be watching this area to see if I can get a bullish entry, with another attempt planned at 2300 if 2360 breaks.

Bullish factors: Economic data slowing, rate cuts very likely to come in heavy towards the back half of the year, geopolitics brewing in the Middle East and eastern Europe.

- Nick

UBER and Caterpillar Co dropped some strong earnings this morning. This could be taken as a positive sign for the economy, as travel and construction revenues looking healthy for these two companies respectively.

- Nick