To The Moon

Markets attempted three separate rallies today, but each one failed, leaving major indexes in the red once again:

🔻 $S&P 500(.SPX)$ : -0.8% (briefly entered correction territory) 🔻 $NASDAQ(.IXIC)$ : -0.2% (-9.3% from record highs) 🔻 Dow Jones: -478 points (-1.1%). $NVIDIA(NVDA)$ $Tesla Motors(TSLA)$ $Vanguard Mega Cap Growth ETF(MGK)$ $PALANTIR TECHNOLOGIES INC(0A7R.UK)$

Stocks

While some choppiness is expected during new administrations, this level of policy-driven volatility is unprecedented, particularly with the rapid-fire policy shifts from Washington.

1️⃣ Labor Market: Cooling but Still Resilient

The JOLTS report shows stronger-than-expected demand for labor, but a much cooler market than in 2022, when it easily withstood aggressive rate hikes.

• Key signals: Job openings remain above pre-pandemic levels . "Take this job and shove it" indicator (quit rate) still elevated. Weaker labor demand could ease inflationary pressures

• Eases inflation fears, giving the Fed more room to cut rates and explains why Fed Funds Futures are growing more aggressive on rate cuts this year

2️⃣ Volatility: Market Selloff Not Over Yet

The CBOE VIX Index closed at 27.9, above its key threshold of 27.3.

$VIX

• Historical context: Every down year for the S&P 500 since 1990 has seen multiple VIX closes above 27.3. However, strong bull markets have also had temporary spikes above this level 11+ closes above 27.3 historically signals a more serious bear trend…

Market impact: Short-term volatility likely to persist and Not necessarily a bear market—yet

3️⃣ Bitcoin and Gold: Decoupling from Stocks?

🔹 Bitcoin's 30-day correlation with the S&P 500 is just 0.37 🔹 Bitcoin’s correlation with gold is even lower at 0.28

$BTC

• Key takeaway: Bitcoin and gold are charting their own paths, not directly tied to equity market moves. Recent declines in all asset classes may mask this divergence and Could indicate an emerging safe-haven status for Bitcoin.

4️⃣ Consumer & Business Sentiment Flashing Warning Signs

Business Confidence Falling: NFIB Small Business Optimism Index fell for the second month in a row (-2.1 pts to 100.7). Business uncertainty is now at its second-highest level in 50 years

📉 Consumer Confidence Dropping: 🔸 New York Fed Survey of Consumer Expectations shows 27.4% of households expect to be worse off in a year—highest since Nov. 2023. Bank of America card spending per household dropped 2.3% YoY, a sharp decline from +1.9% in January and Restaurant spending fell, signaling broader consumer pullback

🔍 Bottom Line: Markets on Edge, Fed Rate Cuts More Likely

Labor market cooling = Lower inflation pressure = Fed may cut rates sooner .

VIX above 27.3 = More short-term volatility ahead. Bitcoin & gold are not tightly correlated with stocks. Business & consumer confidence falling = Downside risk for economic growth.

Consumer price index for February. The consensus call is for a 2.9% year-over-year increase. The core CPI, which strips out volatile food and energy prices, is expected to rise 3.2%.

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This summary is for informational purposes only and does not constitute financial advice. Investors should conduct their own research before making investment decisions.