Is Inflation Trump’s solution?

Current markets are choppy and indecisive. Our Smart Money Tracker reveals why: Since June, we see alternating Bearish and Bullish Impulses, combined with alternating Accumulations and Distributions. This is Rotation, yielding a choppy, sideways market—perfect to lose money.

In physics, systems tend to start oscillating heavily when they approach a regime that is less stable. Compared to financial markets, we could transfer this model and define a stable Bull-Trends, which is followed by a heavily oscillating Top-Formation. Well, we don’t know yet if this is a top or just a sideways consolidation. However, the Smart Money Tracker reveals only thin support and resistance lines in the current market range from 730 to 750 (SPY). Underneath, there is a massive gap caused by the massive April-to-June rally, which happened on very thin volume. No, we don’t use the term “Market-Manipulation” to explain this rally; we just note what happened… Solid support is found around the 680 level. Could we see a pullback to 680? Currently, we are missing solid risks to trigger such a correction; our Risk Analysis can’t detect any reasonable risks in the system right now. However, risks are always there: 1. The U.S. debt time bomb, caused by exuberant spending by the Trump administration and an upcoming debt-refinancing wall

US Borrowing

2. A Fed policy that tends to become increasingly less transparent under the new chair

CPI Component Breakdown

, U.S. Treasury yields are in a consistent uptrend and might break through the critical 5% level

US 30 year Government Bond yield

3. The global impact of the one-man tweet show, causing new wars in the Middle East and potential oil price shocks

4. The private-credit shadow market, now believed to be larger than the regulated credit market.

5. 

Total Debt Balance and its Composition

Percent of Balance 90+ Days Delinquent by Loan Type

6. AI and data center bubble

What to make of all of this?

The market prices these only as medium- to long-term risks and seems to focus mainly on AI hyperscalers, data centers and semiconductor stocks, thus creating this high-volatility environment ahead of the Q3 earnings season. But at the same time, the Energy sector is the strongest, indicating that we are in the last phase of the recent bull run.

The best opportunities lie in single stocks and not in broader indices, as money rotation creates choppiness. Find the inflows into single stocks by using our MarketsInVitro Stock-Screener, which allows you to filter Sectors, statistically approved patterns, Accumulation regimes, Market Outperformance, Insider Trades, Dark-pool trades and many more.

Dark pools detected in GOOGL, around the support level of $33, and a statistically relevant bullish pattern yesterday