The U.S. equity market over near the past half year can be summarized by one simple chart, shown below. The /ES blasted sharply higher up to the end of 2023, back-pedaled deceptively for just a few days, and then resumed the rocket launch, albeit on a slightly less-inclined trajectory. Pretty much new highs, every day, without fail.
In turn, volatility has been smashed into the ground, dropping by about half in the same span of time. We closed yesterday in the sub-teens, a pathetic level which indicates rock-solid confidence that there will never be any troubles, ever again, no matter what, under any circumstances. Ever.
In sharp contrast to the new-highs-every-day schtick that the /ES and /NQ are playing, the /RTY remains in a fascinating and captivating cycle for two solid years. The small caps are miles away from any lifetime high at all. Instead, the market finds itself, for the sixth time, mashed against the upper bounds of its Fibonacci-based range.
In the background, the U.S. dollar continues its quest toward becoming one-ply toilet paper, and in turn crypto and precious metals are thriving. Below we see gold (by way of /GC futures) which has, once again, pressed to never-before-seen levels.
Good luck out there today, folks!
