Weekly Roundup
1. The Real Focus of the FOMC Isn't the Rate Move. It's the Treasury Yield Curve.
Markets have largely priced in a 25-basis-point hike, so whether asset prices reprice sharply in the near term will hinge on how the Fed frames its future rate path and inflation outlook. The 10-year Treasury yield is closing in on 5%, and a decisive break above that level would weigh on both stocks and gold through three channels: valuation discounting, funding costs and risk appetite. What markets are really waiting on is whether long-term yields have peaked.
2. Beneath a Calm Surface, US Stocks Show Signs of Technical Fatigue.
Market breadth is fading fast: only about 28% of NYSE-listed stocks are trading above their 20-day moving average, and the equal-weight S&P 500 has slipped below its own 50-day line. Combined with weakening RSI and MACD readings, this points to pressure spreading well beyond a handful of heavyweight tech names. Traders with higher risk tolerance could consider short-dated option straddles or small long positions in VIX, betting on volatility expanding after the FOMC rather than guessing on direction.
3. Four Scripts After the FOMC, and Policy Credibility Is What Really Matters.
If the Fed holds rates steady, stocks and gold could rally on the surprise relief, but with inflation pressure still lingering at the long end, that bounce may not last. If it hikes but keeps guidance vague, short-term yields could ease while the long end stays elevated, leaving stocks and gold stuck in a weak, choppy range. If it hikes and signals an exit from easy policy, the dollar likely strengthens and stocks face pressure first. If it hikes with a clearly hawkish stance against inflation, short-term rates may rise even as long-term yields peak, though stocks and gold could both come under pressure in the near term. The takeaway: waiting for the policy signal to land before trading tends to beat loading up on bets ahead of the meeting.
4. The Mid-Term Bull Case for Commodities Is Fading. Time to Trade the Range, Not the Trend.
Oil, agricultural commodities and some industrial metals have ridden the inflation narrative, geopolitical risk and weather disruptions higher, but a Fed tightening cycle would leave the most inventory-heavy names most exposed to a pullback. The commodity bull's "golden window" may already be closing, so quick in-and-out trades, scaling out profits and trailing stops now make more sense than riding a single trend. Gold, by contrast, looks set for a range-bound market, with the core band running roughly from 4,000 to 4,800. That favors buying near support and selling near resistance, or writing options further outside the range, rather than chasing a one-way rally.
5. Bitcoin Still Worth Watching at These Levels, but It's a Trade Right Now, Not a Long-Term Hold.
Bitcoin's rate sensitivity and price pattern closely track gold's, though it tends to swing harder and lag slightly behind, making it something of a high-beta version of gold. Since it has broken below its 20-month moving average, and history shows such breaks are typically followed by roughly six months of consolidation, the near-term play is to wait for the FOMC outcome and clearer liquidity signals before betting on a more reliable trend.
6. With Dollar Strength a Real Risk, Euro and Offshore Yuan Deserve a Place in Portfolio Planning.
If US rates keep climbing while Europe's economy stays relatively soft, the dollar's edge over the euro could widen further. The yuan, meanwhile, faces its own downside risk from the US-China rate gap, signs of domestic monetary easing, and its own cyclical timing. For investors holding foreign-currency liabilities, cross-border cash flows or sizable yuan-denominated assets, this isn't just a speculative angle. It belongs squarely in FX exposure management.
Weekly Report
Last week (from August 31 to September 4), US macro data sent hawkish signals. On August 31, Fed Chair Kevin Warsh told the Jackson Hole symposium that inflation remained too high, hinting at further rate hikes if price pressures failed to ease enough. Then on September 4, August nonfarm payrolls came in at 162,000, far above the roughly 55,000 economists had expected and the second-strongest monthly gain this year. Unemployment held steady at 4.1%, and July's figure was revised up from negative to positive. The stronger-than-expected jobs data pushed up expectations for a September hike, and Treasury yields climbed in response.
According to Multpl, the S&P 500's trailing P/E ratio stood at 26.16 as of September 11, above its roughly 25.2 10-year average. The P/E chart shows the ratio spiking above 39 during the pandemic in late 2020, falling back to around 20 in 2022, then climbing again to oscillate in the 25-to-28 range. While that's well below the pandemic peak, it's still notably higher than the 20-to-23 range seen in 2018-2019, keeping overall valuations on the elevated side.
According to FRED data (DGS10), the 10-year Treasury yield has climbed to 4.961%. Combined with the S&P 500's P/E ratio, the stock-bond yield gap, calculated as 1÷PE minus the 10-year Treasury yield, comes out to negative 1.14 percentage points. The chart shows this gap has sat in negative territory since the second half of 2023, oscillating between roughly negative 0.3 and negative 1.1 percentage points since 2024, and it's now near its lowest point in that period. A negative reading means the stock market's earnings yield, about 3.82%, sits below the risk-free rate, making equities a relatively less attractive allocation versus bonds.
In short, last week's blowout nonfarm payrolls report far exceeded expectations, further reinforcing hopes for a Fed rate hike. If rates keep rising, they'll keep squeezing the stock-bond yield gap through the valuation denominator. With the P/E ratio above its 10-year average and the risk-free rate closing in on 5%, stocks now face a double squeeze of stretched valuations and high rates, leaving investors exposed to a valuation reset once the hike is delivered.
Below are the views shared this week by several Tiger Community experts:
Both the euro and WTI crude longs turned positive last week, after being held for more than two months. With a Fed rate hike now imminent, a new setup could trigger at any moment. Since many of our swing positions run for a while, the front-month contract sometimes changes underneath us. Physical delivery is essentially off the table, so in practice the choice comes down to this: cash-settle and close the expiring contract, then roll into the new front month. The variable to watch here is how much premium the new, further-dated contract carries. Commodity futures tend to run wider premiums than financials, and if that premium tops 2%, it's worth reassessing the strategy.
Based on the current CME FedWatch reading, a 25-basis-point hike this week is now essentially a done deal. In other words, the first hike has jumped forward from the fourth quarter or December to September. Whether markets reverse on Fed day, or the day after, will set the tone for the next 30 to 45 days. A sustained one-way move without a reversal would suggest that a new trend is taking shape, while the opposite, a reversal, extends the range. If you're not confident reading the setup, it's fine to wait for next week and trade with the flow.
Weekly Macro Strategy Recap
EUR/USD: Closed the 1.1420 long at 1.1570, banking +150+150 pips. New limit buy orders placed at 1.1502 and 1.1442 (half size each), stop at 1.1360, target at 1.1800, good-till-canceled.
Crude oil: The long from an average 75 hit its first target of 95 last week, and half the position has been taken off the table. The stop has already been moved up to breakeven, guaranteeing a risk-free trade from here (though the more technically sound level would sit just under 74). Next target is 115, where the remaining position will be closed out.$WTI Crude Oil - main 2611(CLmain)$ $United States Oil Fund LP(USO)$
Gold: No fills either way last week, so we're adjusting slightly this week. Keeping the limit sell orders at 4830 and 5170 (half size each), stop at 5275, target 4000. On the downside, limit buy orders at 4265 and 4130, stop at 3960, targets at 4765 and 4910. There could be other opportunities on FOMC day itself, but those are more flexible, so we'll make fresh calls next week based on how the market actually reacts.$Gold - main 2612(GCmain)$ $SPDR Gold ETF(GLD)$
Among today's financial assets, US stock indices are the most stable. The Fed is hiking because the economic data has been strong, and the party in power always finds ways to keep expectations steady ahead of midterm elections. That makes stock indices the arena where bulls and bears are most evenly matched, with the size of any swing depending on whether the market ultimately breaks up or down.
This week's playbook stays simple: bullish above 28,900, bearish below it. Aggressive traders could try a long straddle, buying both a call and a put, to bet on a black swan like the Fed skipping the hike or a surprise shock. Nasdaq futures have consolidated for a while, so a bigger volatility spike may be brewing there, worth a shot with options.
$Invesco QQQ(QQQ)$ $NASDAQ(.IXIC)$ $E-mini Nasdaq 100 - main 2612(NQmain)$ $Micro E-Mini Nasdaq 100 - main 2612(MNQmain)$ $SPDR Portfolio S&P 500 ETF(SPYM)$ $S&P 500(.SPX)$ $E-mini S&P 500 - main 2612(ESmain)$ $Micro E-mini S&P 500 - main 2612(MESmain)$ $Cboe Volatility Index(VIX)$ $E-mini Dow Jones - main 2612(YMmain)$ $Micro E-mini Dow Jones - main 2612(MYMmain)$ $Dow Jones(.DJI)$
Even commodities with elevated inventories have posted gains this year. But once the Fed's rate hike lands and starts weighing on inflation, the most inventory-heavy names, such as agricultural products and certain industrial metals, are likely to be the first to roll over. How far they fall over the medium to long term will ultimately depend on how far the Fed's hiking cycle goes. All told, the golden window for going long on commodities has passed, and short-term speculation is the safer bet from here.
$WTI Crude Oil - main 2611(CLmain)$ $E-mini Crude Oil - main 2610(QMmain)$ $Micro WTI Crude Oil - main 2610(MCLmain)$ $Natural Gas - main 2610(NGmain)$ $Brent Last Day Financial - main 2612(BZmain)$ $E-Mini Natural Gas - main 2610(QGmain)$ $COPA.UK $ETFS ALUMINIUM(ALUM.UK)$
A Fed hike raises the odds of a stronger dollar, and other currencies typically weaken against it as a result. The offshore yuan looks due for a turn, and it could start weakening as the dollar gains on the hike. Investors should factor this into how they manage their currency exposure.
$Euro FX - main 2612(EURmain)$ $Canadian Dollar - main 2612(CADmain)$ $SGX USD/CNH - main 2612(UCmain)$ $HKEX USD/CNH - main 2612(CNHmain)$ $Mini HKEX USD/CNH - main 2612(MCNHmain)$ $Mini SGX USD/CNH - main 2612(MUCmain)$
Weekly Macro Strategy Recap
This week marks the FOMC meeting, and the market is pricing in roughly a 90% chance of a rate hike. Yet financial markets don't appear to have fully priced this in. Going heavily long right now still carries real risk, so the better approach is to wait for the post-meeting policy details and market reaction to become clear before deciding on the next move.
Last week's strategy of selling Put on stock indices kept generating steady gains, up about 1%. This week, however, index futures have gapped lower, and the index looks poised to break below its range and extend losses. That means this week's put-selling approach needs tighter discipline around technique and entry conditions. If the Nasdaq holds above 28,900 through Monday and Tuesday, it's better to sit out. But if it breaks below that level on either day with a sizable drop, consider selling puts at a strike more than 7% below Monday's opening price.
If the Fed hikes, gold's near-term bias stays to the downside, with a pullback toward the $4,000 area likely as buyers step in to defend that level.
Ahead of the FOMC outcome, the smartest move might not be to rush into a trade, but to wait. FX markets and long-dated Treasuries have already priced in this week's policy action fairly thoroughly, so the real uncertainty lies elsewhere: how deep the split runs inside the Fed itself, how many members oppose a hike, and how many are pushing for a more aggressive tightening path. That's what makes the dot plot, the post-meeting statement, and Warsh's forward guidance on the rate path the real catalysts that could shift the market's direction over the near to medium term.
$S&P 500(.SPX)$ $NASDAQ(.IXIC)$ $Dow Jones(.DJI)$ $E-mini S&P 500 - main 2612(ESmain)$ $E-mini Nasdaq 100 - main 2612(NQmain)$ $E-mini Dow Jones - main 2612(YMmain)$
On the weekly chart, the 10-year Treasury yield's near-term uptrend still looks intact. As long as oil prices keep climbing, the upward pressure on yields is unlikely to fade in any meaningful way. A decisive break above the prior high of that cup-shaped pattern, around the 5% level, would likely hit stock indices hard, and gold would probably weaken further in its wake:
$US10Y(US10Y.BOND)$ $US2Y(US2Y.BOND)$
Technical indicators have already flagged the market's underlying tension. On the NYSE, the share of stocks trading above their 20-day, 50-day, 100-day and 200-day moving averages has trended negative across the board, with only about 28% still holding above the 20-day line. That points to thin market breadth, meaning the near-term downside likely hasn't fully played out yet:
The equal-weight S&P 500 has also broken below its 50-day moving average, alongside RSI slipping below the midline and MACD crossing under the zero line. That combination mirrors the technical setup seen the last time the 50-day support gave way. In other words, weakness isn't confined to a handful of heavyweight names; it's the market's internal structure that's starting to crack.
As a result, if the 10-year yield breaks above 5%, pressure on stocks likely won't stay confined to sentiment. It will run through three channels at once: valuation discounting, financing costs, and risk appetite, all reinforcing each other. The faster long-term yields climb, the more strain high-valuation assets will need to absorb.
Pricing in the 2-year Treasury yield suggests the market has already built in roughly 100 basis points of hikes over the next two years. The 2-year yield has traded as high as around 4.7%, versus a current policy rate ceiling of 3.7%. That gap implies this week's expected 25-basis-point hike is largely a given; what markets are really watching is whether the FOMC will validate the remaining 75 basis points of tightening penciled in for the next two years. Assuming 25-basis-point increments, the market is effectively pricing three more hikes on top of this week's move, four in total.
Given that setup, the post-FOMC outcome splits into four broad scenarios, with policy credibility driving how assets react. A hold would likely lift stocks and gold on the surprise easing, but with inflation pressure still lingering at the long end, that relief may not last. A hike paired with vague guidance could see short-end yields ease while the long end stays elevated, leaving equities and gold choppy and range-bound. A hike that signals an exit from further easing would likely strengthen the dollar and pressure stocks first. A hike framed around forceful inflation-fighting could push short-end rates higher even as long-end yields possibly peak, though stocks and gold may come under joint pressure near-term. So the takeaway is: waiting for the policy signal to land, then trading with it, tends to beat placing heavy bets ahead of the decision.
Weekly Macro Strategy Recap
Ahead of the meeting, directional bets carry outsized risk. For risk-tolerant traders running larger books, one option is to play for a VIX bounce, scaling in small on dips rather than chasing the move. Another is a straddle, buying both a put and a call on the equity index to capture volatility either way. Both, though, are inherently speculative plays. Cap the maximum loss at 30% of prior gains, so a wrong call doesn't dent the broader portfolio. Here's how that could work:
$ProShares VIX Mid-Term Futures ETF(VIXM)$ $ProShares Ultra VIX Short-Term Futures ETF(UVXY)$
Take profits on last week's short-put positions in the equity index and Nvidia, and roll part of the equity index exposure into a lighter, hedged straddle: buying a put and a call expiring in two weeks to capture any VIX rebound after the FOMC decision. At the same time, continue selling puts on Marathon Petroleum at lower strikes.
$NVIDIA(NVDA)$ $Marathon Petroleum(MPC)$
For gold, consider a directional long-put position, betting on further downside. The overall structure in gold remains bearish, with a fairly clear topping pattern taking shape. The 4258 level serves as near-term resistance; a break below it would likely open the door to a retest near 4000.
Judging by last week's options gains, our strategy is performing quite well so far.
Last Week's Strategy Follow-Up
This week's strategy: the long EUR futures position entered at 1.1420 remains in play. As the recent rally gained traction, the stop has already been raised to 1.1570, and no breach occurred last week. The bullish target stays unchanged, split evenly between 1.1770 and 1.2420.
For crude oil, the long position carried at an average of 75 remains open. The stop has been adjusted to breakeven at entry, locking in a risk-free position going forward, though in practice a level just below 74 would better reflect the trade logic. Targets remain unchanged, split evenly between 95 and 115.
For gold, neither the long nor short side triggered last week, so this week's limit orders stay in place. The plan keeps limit sell orders at 4830 and 5170, split evenly, with a stop at 5275 and a target of 4000.
Results: the swing long in EUR remains in unrealized profit, crude oil is profitable, and gold has yet to trigger.
1. The short-put strategy on U.S. equity indices paused for a week and resumes this week. With the index still holding above its 20-week moving average, strikes 7% or further out of the money remain the target range.
2. Selling weekly puts on a small gold position also paid off last week, so the same approach continues this week: selling puts around the 4000 to 4100 level, with strikes capped at 4100.
Results: both the equity-index puts and the gold puts sold at lower strikes came out profitable.
For gold, the plan sticks with selling puts near the 4000 level. On U.S. equities, Nasdaq futures remain above the 20-week moving average, with support holding on the downside, but elevated yields keep capping the upside. That combination points to a similar range-bound setup, so the idea of selling puts on QQQ below its prior low of 661 still holds.$ProShares UltraPro Short QQQ(SQQQ)$
Meanwhile, the earlier ideas on XLF and Nvidia puts remain valid. And since the U.S.-Iran standoff shows no sign of resolution, crack spreads are unlikely to retreat anytime soon, which keeps the case open for selling puts on refiner stocks at depressed levels, such as selling Marathon Petroleum puts with strikes below its recent daily-chart low.
Results: the put-selling strategies on QQQ, gold, XLF, Nvidia, and Marathon Petroleum at lower strikes all came out profitable.$Euro FX - main 2612(EURmain)$ $USD Index(USDindex.FOREX)$
Disclaimer: This article is a compilation and analysis of publicly available data for market observation purposes only and does not constitute investment advice. All levels cited are technical reference points and do not imply that prices must reach or reverse at them. Markets carry risk; please exercise independent judgment.
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