Hey there, it’s Garrett.
For 43 days, everyone was glued to shutdown headlines. Politicians screaming. Markets "uncertain." Pure chaos.
Me?
I was watching my momentum signals.
Sure, caught some bad football in between sessions, but I was positioned for exactly this moment.
The Trade Everyone Missed
Here's what I saw while others obsessed over political theater: the shutdown ending removes a liquidity overhang and restores data visibility.
But here's the contrarian play - everyone thinks this data dump creates clarity. It won't. It creates chaos.
Why the Data Deluge Will Shock Markets
We've had 43 days of blind trading. No employment numbers. No inflation data. The Fed flying completely blind.
Now we get six weeks of data dumped all at once. Markets pricing in assumptions are about to get reality-checked hard.
My Momentum Signal Called This
The signal I use - tracking breakouts versus breakdowns across sectors - caught February's drop, April's panic, August's selloff days before the Nikkei crash.
While everyone read shutdown headlines, I watched this signal prepare for the reopening.
The Pattern You Need to Watch
Phase 1: Everyone celebrates "uncertainty" being removed
Phase 2: Data starts flowing, reality hits
Phase 3: Real volatility begins
We're entering Phase 2 now.
The VWAP Strategy for Volatile Days
Stanley Druckenmiller said it back in 2018: algos buy when we push into the third and fourth standard deviation.
Here's my play: if there's a violent move down, we tap that third deviation line, maybe push into the fourth, then look for a rebound back to VWAP.
Don't speculate at the top. Play the higher probability rebound at the bottom.
What Smart Money is Doing
Watch treasury auctions. My bet: they'll refinance at the front end where it's easier to roll short-term debt.
But pay attention to 5, 7, 10-year auctions. We need to see if there's actual demand for US debt post-shutdown.
The AI Trade Reality Check
As long as this liquidity cycle continues, AI stocks stay strong until leverage gets removed.
But watch funding stress signals: SOFR creeping above fed funds rate, repo activity, yen weakness. When secured lending costs more than unsecured lending, that's like a pawn shop charging more than the mob.
The Three-Fund Reality
The buyers have changed since the 1990s:
- Old school managers: 80% → 20%
- Passive ETFs: 5% → 50%+
- Leveraged momentum funds: The volatility drivers
Nvidia and Palantir fit ALL THREE buyer profiles. That's why they stay strong while others fade.
Energy's Hidden Setup
While everyone was distracted, energy set up perfectly. OILU hitting RSI 65-67 (overbought) plus money flow indicators extended = consistent selloff opportunity.
The Bigger Picture
43 days of shutdown hysteria taught me: focus on market structure, not political noise.
The three buyer types don't stop operating because politicians can't agree on a budget. Understanding this gives you the edge while everyone else chases headlines.
Position for What's Coming
The reopening isn't the end of uncertainty - it's the beginning of real volatility.
Data will flow. Reality will hit assumptions. Traders who focused on structure during chaos will profit while others figure out what happened.
I spent 43 days watching signals while others watched theater.
Where will your focus be when the next "crisis" hits?
Stay Positive,
Garrett Baldwin
P.S. Join me live tomorrow morning in the pre-market, it’s 100% free to join these live sessions.