The market came in hot this morning, and gold just blew through a milestone most people never thought they’d see. But under the surface, momentum is tightening and cracks are forming in spots traders love to ignore until it’s too late.
Key Takeaways
Gold at $4,000 – the pet rock is alive
- Gold ripped to $4,000, and Goldman now sees $4,900 next year.
- ETFs are seeing inflows, central banks are still buying, and miners like GDX are minting margins. But don’t chase—spreads under the 50-day remain the cleanest way to play.
Momentum narrowing – leadership matters
- The S&P is still levitating, but tech breadth is weak. Big names like AMD and Palantir are fine, yet under the surface unprofitable tech is slipping back into slumber.
- More S&P stocks are breaking down than breaking out—if that flips yellow, hedges are mandatory.
Dollar strength is the wild card
- A rising dollar pressures equities, gold, and commodities. Japan’s dovish stance and eurozone instability are funneling money back into the dollar.
- If this accelerates, crowded AI trades could get hit harder than people expect.
What I’m Watching
Earnings season kicks off tomorrow with Delta and Pepsi. Banks follow next week, and that’s where the real test lies—trading into earnings, not through them. I’m focused on breadth: if the market keeps rising while fewer stocks hold their 50-day, that’s a classic top signal. At the same time, defensives like utilities and staples perking up is a contrarian warning. Layer in global risks—Japan remains my top candidate for the next shock—and you’ve got a fragile setup heading into October earnings.
The market’s giving us a shiny headline with gold, but the smarter trade is watching breadth, spreads, and dollar strength. Momentum doesn’t last forever, and when it shifts, it happens fast.
Until next time,
Garrett Baldwin
TheoTRADE