Transcript of Wall Street Are Dumping This...
FX Evolution - Trading Academy
0:00Wow. Over the last 24 hours, Wall Street0:03started to pay attention again to US0:05treasuries. And this means only one0:08thing. They're in freefall at this0:10point. So why should we be paying0:12attention as traders and investors? And0:14how will it impact you as yields reach0:16levels not seen since 2007? Well, it's0:20clear that this all has to do with many0:22different cogs underneath. But actually,0:24one of them that surprised most people0:26over the last 24 hours is it's got to do0:28with also AI. As Diesel makes new highs,0:32USO has the largest darkpool transaction0:34on it in years. We're also seeing big0:37movements through the hardware and tech0:39stocks. And it all comes back to what's0:42actually going on when it comes to bonds0:44and considered risks. With the VIX0:47saying nothing to see here, should we0:49really be looking actually underneath0:51the hood?0:55Well, welcome back. It's great to have0:56you here. And today we're discussing the0:58price action, the data, and the flows.1:01My name is Thomas Atinson, and today I1:03bring you a very important storyline1:05because, of course, Wall Street is1:07flipping the switch. I've been in1:08markets for over 17 years and on this1:10channel we do things a little bit1:12differently. Bringing the institutional1:13style insights that I learned over the1:15years to try to get rid of bias and more1:18importantly understand the behavioral1:19finance techniques behind the curtains1:22of of course what you're seeing also on1:24the charts. Let's start off though by1:26discussing the big story of the last 241:29hours which has to do with of course1:31bonds, bonds, bonds. Really, if you1:33don't get the debt markets, you're1:35probably not going to get the Wall1:37Street. And they've just been pushing to1:39levels that we haven't seen since 20071:41with new higher highs in the long-term1:43yields. Remember, they're the yields1:45that are actually supported by the1:47market, not by the Fed. And treasuries1:50are in freefall, but not for the reasons1:52you might be thinking. It actually has1:54to do with the AI run. And remember just1:58a while ago we reported on 100-year2:00bonds from the likes of Google. Well, as2:03it turns out, we've had $1.5 trillion of2:06new debt issuance in the US, including2:08that $200 billion from big tech. And2:11this is up 36% yearonear, which is a bit2:14of a concern because it's starting to2:16cause illquidity problems with the2:18street saying, you know, why would I own2:20US treasuries when I'm now suddenly2:22starting to get paid more? Remember,2:24credit default swaps are going up for2:27taking on Magnificent 7 debt. And that's2:31what it seems like according to the2:32latest reports some of the biggest2:34players are doing. So, does this sound a2:36little bit uh worrisome when you think2:39about it? One risk profile often2:41considered very le low risk being US2:44treasuries and one risk profile going2:46into what is currently a massive of2:49course capex spend. In the AI run, we2:53are seeing huge movements. And I2:54actually wrote about this over on X if2:56you're interested in following, links in2:57the description down below with our2:59seven things that were pretty wild in3:01markets today. Basically showing that3:03yeah, we've got some massive bond3:05issuance, 36%.3:07But at the same time, we're also seeing3:09AI related issuance is now equivalent3:11to, and this number is pretty shocking,3:1425%3:16of net treasury bond sales to private3:19investors. So this is roughly five times3:22last year's share and it's really3:24starting to dead it when you also think3:26or dent into it when you think about the3:28bank of Japan, the Bank of Korea and of3:31course the US government's intervention3:33in currencies just 2 weeks ago. Suddenly3:36everybody's talking about it and it's3:39caused a little bit of a drop in markets3:41and we'll have a look whether that's a3:42big concern. On the plus side, Anthropic3:44actually just gave another reminder that3:47they believe the AI economy is looking3:48pretty good though. The company has3:50reportedly told investors its annualized3:52revenue run rate is around $65 billion3:55in July. Now, do you think that's enough3:58though? Let us know in the comments down3:59below. We do have a lot of, of course,4:00software engineers and you guys are deep4:02into the AI storyline. So, do you think4:05Anthropic is going to be making enough?4:07Obviously, it's one of those IPOs, IPOs,4:09IPOs that we're looking at this year,4:11and it's slated maybe for the end of4:14this year somewhere from October4:15onwards. So, let's talk about how this4:17is impacting everything. This one here4:18from Hedgy Markets and of course source4:21from Bloomberg and Morning Star data4:23basically shows us the story on a chart.4:26Government Treasury average allocation,4:28it's dropping off a cliff while we're4:30seeing corporate bond average allocation4:33going up. And this just basically means4:35there's a shift here from what is4:37considered often the less risky kind of4:39play to the higher risky kind of play. A4:42symptom often of late cycle investing. I4:46will say that and generally late cycles4:48can last for like 1 to 3 years. So we've4:50been in that for probably around 6 to 124:52months at this stage. Now why do we also4:55kind of go with the late cycle4:56narrative? Well, you can see here from4:58duality research something that we've5:00already been talking about now for the5:01last couple of days shows that US dollar5:03positioning went to some pretty high5:06extreme highs. And this is one of those5:09worrying signs because when the US5:10dollar index is on the the run up and it5:13gets to these levels, as you may note,5:16it's often dropped off from this point.5:19And this is showing again some weakness5:21sometimes in the actually strongest5:23economy in the world from the debt side.5:26And remember, US treasuries is only one5:28part of the story, but we're at now $405:31trillionish dollars of overall debt up5:34massively since the global financial5:36crisis. And yes, that's always a ticking5:38bomb, but at the same time, it hasn't5:41been a problem yet. Remember, if the5:43bonds really wake up, you start to see5:45VIX spiking and other things happening,5:47then you can seek some concern. So, is5:49it all bad from the bond side? Well, yes5:52and no. So, let's take a look here at5:54macrocharts.com's great chart. This5:56one's been going around everywhere on X.5:58Shout out to macrocharts onx. And he6:01showed here that basically I think this6:02is probably the cot report that record6:05shorts were coming through just recently6:07on tech. So no wonder we started to see6:10of course a bit of a squeeze. Now so far6:13XLK and tech stocks and NASDAQ have been6:16going quite well. That is some of these6:18stocks are making new all-time highs6:20while of course semiconductors or the6:22backbone of the current AI rally.6:25They've been struggling a little bit6:27more. last 24 hours a little bit of6:28improvement, but you do need to think6:30about these charts as just one read.6:32Remember, it's about bringing together6:34all of the information and looking at it6:36objectively. Another one is the FINRA6:38margin debt. We saw the fallout of, of6:41course, July. That was that margin debt6:43drop for the first time in a while. And6:46drops should be considered when we've6:48got new highs. That is, we considered6:51this last year. Obviously, it wasn't6:52sustained back in 2025 and we consider6:56it again now. Do we see sustained6:58dropping in margin showing that people7:00just absolutely got tapped out when it7:03comes to what happened with the massive7:05crash in hardware stocks? We need to7:07remember that some of these stats were7:09absolutely insane. We saw the number one7:13assets under management ETF in Hong Kong7:16being a two times levered single stock.7:18We saw 1.2 2 million accounts in South7:21Korea reportedly coming in with leverage7:24debt and even I think like half a7:26million getting liquidated out. So these7:28are not rookie numbers. These are7:29absolutely massive and it does go to7:32show again that we need to be on the7:34ball when it comes to this data. If you7:36think this type of stuff interests you7:38as well, remember to subscribe and smash7:39that like button, guys. Does help us out7:41and of course we do these here daily.7:43Let's take a look though at whether7:45we've peaked in the market. Now we did7:47see a high for the NASDAQ in June and so7:50far we haven't actually made it back to7:52those levels. Now only one time before a7:55bare market according to Blue Kurdic7:56Market Insights here and data we've also7:58seen before did we hit a level in June8:01in terms of it being the peak. In fact,8:03markets tend to actually top in two8:05months, particularly October and8:08December, sometimes January as well. But8:10yeah, interesting because of course8:12October is also one month out from the8:15midterm election years. Often considered8:17the weaker in the seasonals. But here's8:19where things get really strange. Over8:21the last 24 hours, we've seen a big one,8:24guys. Yes, a big big financial8:27transaction. coin to dark volume leaders8:30here. There was a dark pull, the sixth8:31largest. The market's dropped a little8:33bit in financials since then. And you8:35can see that sometimes these happen8:37around key turning points. And these are8:39the kinds of things that we do pay8:41attention to here on the channel. Could8:42it be a buy? Could it be a sell? Well,8:45I'll let you guys know that you can kind8:47of guess that from maybe the levels that8:49it's at, but we never really know until8:51you do start to see the price action8:53movement. But this is the sixth largest8:55transaction. And if we see a whole bunch8:57of them again, it could be suggesting8:59that financials will either go into a9:00pit, that is a pullback in time, or even9:03a bit of a decline. We'll take a look at9:05the charts later on for this one. It's9:07pretty wild stuff. Let's have a look at9:08the sentiment reports. As we know,9:10they're starting to equal out a little9:11bit more. We got more bulls, more9:13neutrals, more bears or just the kind of9:16same bears over the last week of9:18reports. And so far, we've been climbing9:19what we call the wall of worry. And one9:22of the reasons that's really important9:23to note is that behaviorally retail9:26traders and investors, you guys, we all9:29do it. We all do it together. We tend to9:31make the same mistakes. In fact, one of9:33the hilarious stats, or maybe not so9:35hilarious when you've been part of it,9:36is that Mondays tend to uh usually be a9:40little bit more bullish. Take a look9:42here at the average percentage change by9:44weekday in 2026. Now one of the reasons9:46is because we come in bearish in the9:48futures and then we end up seeing9:51rallies from the street and remember9:53which is the number one biggest trade9:54day of the re week for retail generally9:57Monday Tuesday. So funny stuff there.9:59When you think about how this market is10:01still manipulating us as retail traders,10:04you've always got to think about it as a10:06perspective of what did you used to do10:08when you first got into the market and10:10can you see how that was possibly wrong?10:12And this is because the life cycle of a10:15retail trader is pretty similar. We10:18actually talk about this in our courses10:19over at fxevolution.com particularly in10:21the day trading and advanced master10:23classes and I think you'll find uh them10:25very very enlightening to why10:27institutionally markets take advantage10:29of some of these situations. Let's take10:31a look here at the earnings release by10:33implied movements. Now we've seen some10:35big ones. This is not the huge week10:38because of course we do now still have10:40Nvidia next week which is going to be a10:42blockbuster report. We'll have a special10:44on that. But just remember, we've got10:45things like target on Wednesday. This is10:48going to be 6.9% expected plus or minus10:51from the options market. Remember, this10:53comes from the options market and10:54earnings watcher here. We've also got a10:57Walmart uh release as well. And this10:59might show us something about the K11:00economy and whether the bottom of the K11:02is starting to struggle because Nike11:05just fell big time again. And that stock11:07has been really struggling for quite11:08some time. Let's take a look at USO, the11:11number one large darkpool transaction.11:13The market has actually regained back11:15above this at this point. And again with11:18the price of diesel due to everything11:19that was going on with Russia, Ukraine,11:21and also everything else in the world as11:23well, we're starting to see a huge huge11:27spike in the costs of possibly11:29transportation, which could lead into,11:31of course, inflation. Now, are things11:33all bad? Well, if you take a step back11:35for a moment, you take a look here at11:36Ryan Detri's chart from Carson Research,11:40you'll note that when you go past a11:41certain period of time for a bull11:43market, on average, you get about 3 311:45and 1/2 years. Once you get past that11:47point, then you often get to 5 years.11:51Now, that's really interesting stat11:52because at the moment, we're sitting at11:54about 3.8 years. So, could that suggest11:56we have another 1.2 to even 2 years for12:00this market? or do you believe we're in12:02one of those epic epic runs? I tend to12:05think it's more kind of in this category12:07over here based on some other things I'm12:09seeing margin depth. But at the same12:11time, we do always need to consider that12:15the markets are generally more bullish12:17than bearish. So, of course, if you are12:18thinking bearish, you've got to be12:20really sure on things and you've really12:22got to see some contagion, some12:23cockroaches where there's one, as12:25remember Jamie Diamond said, there's12:27usually quite a few. If you're enjoying12:29today's video and you want to find out12:30more about some tips and tricks that we12:31have over at FX Evolution, remember to12:33sign up for our next live session. Links12:36in the description and pin comment down12:37below, guys. We'd love to see you there.12:40And we've got, of course, just a few12:41spots available. So, it' be awesome to12:43have you there in about 2 weeks time.12:46Now, let's have a look at financials.12:48So, this is where that big dark pool12:50came in. We saw a sixth largest trade12:52and then since then, we've seen a little12:54bit of weakness in the market. Now,12:56that's not to say that it's a sell and12:58sometimes it can do this and then end up12:59bullish. And do remember there is a buy13:02and there is a sell end. But often times13:04somebody makes a darkpool transaction13:06because they need it done fairly13:08quickly. It's big in size and they often13:11do it with many different entities. So13:13they find their large liquidity from13:16many entities and often it's the buy or13:18the sell end, the first part of the end13:20that actually has got the better13:22information. And you often assume in the13:24comment section, oh Tom, it doesn't mean13:25anything. Remember it does. It's about13:28the level. That's the key. The key level13:30and then the reaction. Remember this13:32idea that we have, patience, react,13:34don't predict is more than just a13:36mantra. It is a way of life in the13:38charts. It is understanding really what13:41is happening on the institutional side.13:43And then you see when they've made a13:45decision and you say, "Oh, I'd love to13:46be on their side." Rather than be on the13:48retail trading side. I mean, we all love13:50each other, of course, but at the same13:51time, yeah. Yeah. There's a there's a13:53few retail traders that don't do so13:55well, if you know what I'm saying,13:57because they suffer, of course, all of13:59the same things that most people do. Um,14:02of course, the Dunning Krueger effect is14:04comes to mind straight away. All right.14:06So, anyway, with financials, are we14:08still holding an upward trend? The14:09general saying is yes, because of14:11course, we're seeing here a series of14:12higher highs and higher lows. Another14:14thing I look at with financials, um,14:16it's still early here, is we want to14:18look at the weekly, which still is of14:20course bullish. So again, things are14:22okay for now. And we want to look at14:23KRE, which is a series of higher highs14:26and higher lows again for now. So that's14:28the regional banks. But let's take a14:30look at the waterfall. This is14:31treasuries. Wow. The money is going out14:33and it is going into what seems to be AI14:35bonds and debt. Yeah, I think that's14:38interesting. It's not uncommon. This is14:40what people do. remember even MSTR and14:43stuff just that was allowing people to14:45chase the yield uh a little while ago14:47and was very very popular at the time.14:49So you can see here that this is pretty14:52shocking stuff though because you would14:54have never thought like I remember when14:56I was looking at these bonds like years14:58ago back before the global financial15:01back before I mean the co period and we15:04were looking at this and I was thinking15:05this doesn't make any sense. It's too15:07expensive. We saw 100redyear bonds15:08issued by some central banks around the15:10world and you were getting like negative15:12equity. It was just ridiculous. Anyway,15:14if you told me it was going to fall like15:16this and that no one would really care,15:19which is what happened, uh you'd say,15:21"No, probably not." So, again, it's a15:23lesson. Expect the unexpected a little15:25bit. I learned that a long time ago. I'd15:27love you to learn it as well, so you15:28don't fall into the trap of not15:30expecting the unexpected. But at the15:31same time, we're now in what we call the15:33fear of the unknown. That is a level15:36that's so low that it's starting to make15:38people say, "Whoa, whoa, whoa, whoa,15:40whoa. What's going on here?" Either way,15:42has it made a level that is, you know,15:45really headlinew worthy? I think a15:47headline worthy level would probably be15:48somewhere around 80 and below. Why15:51$80.50 and below because that would be15:54the lowest point. And uh do you think15:56the market's going for that? Certainly15:58could be. Let's have a look at Google.16:00Weak weak, guys. Not very strong.16:02Google's actually been down. Like, let's16:04count it together. 1 2 3 4. These are16:06all the counts. 5 6 7 8 9 10. So 10 of16:1213 Google's actually been down for. And16:15you wouldn't think it because of course16:16it it seems all great on the surface for16:18mags. And we talked about this on the16:20weekend, but really the Magnificent 716:22hasn't made a new higher high yet. It's16:24kind of been stuck for a while16:26tons of money on hyperscaling. So16:29they're going crazy trying to get in16:31front of AI. It It's one of those16:33paradigms. you're either doomed if you16:35get in and you end up overspending on16:37new hardware and new AI infrastructure16:39or you're doomed if you don't because16:40you fall behind and no one wants to16:42invest in you. So, it's one of those16:43tough times for the market. But when we16:46unpack it a little bit further, we go to16:48the US, let's say uh dollar for example16:51here, you can see that that has seen of16:54course a rise in the amount of bulls.16:56Yet the market itself is is remaining16:59quite indifferent. So, if we go below17:02this level here, this 97 kind of 5017:04zone, could we be seeing a significant17:06weakness in the dollar, which is what a17:08lot of macro experts kind of believe.17:10Let's have a look at the US oil for a17:12moment. Uh, we're not at a higher high17:13yet, but you do want to check a few17:15things with oil. Firstly, you want to17:17look at Brent itself. So, you always17:18want to look at whether Brent has gone17:20to a higher high. Little trick I learned17:22a long time ago is to check these ones17:25out because you want to make sure you17:27can see it. And what this kind of shows17:29is that Brent is actually closer at17:31making a higher high. And there's no17:33surprise because of course when we go17:34over and have a look at diesel, take a17:36look at diesel, diesel refineries,17:38diesel price in general. Look at it go.17:40It's absolutely wild. And this is17:42leading into of course concerns over17:45what is this doing underneath the hood.17:47And we've seen energy stocks, energy17:49stocks have been performing very well17:51over the last two weeks. We've been17:52talking about it. We've seen it in the17:54charts again, the price action, the17:56data, and the flows. And look at this,17:58another excellent session and even an18:00excellent overnight session18:01realistically from the energy stocks.18:03Could we be going for the flag movement?18:06Hey, anything's possible. What about18:07crack? Well, crack is also going up and18:10again, it's started to hit the18:12mainstream, but really it started moving18:14back in July and it's kind of reminds me18:16a bit of oil services. Remember on the18:17channel we looked at these last18:19September or whatever and it was way18:21before anyone even paid attention to18:22energy stocks. Oil services was went18:24wild. Then we saw of course energy18:27stocks picking up. Then we saw gas and18:28oil exploration stocks picking up. So it18:31it always tends to be you know flow to18:33flow to flow and you just need to be in18:35front if you can be and in that first18:38third would be the ideal and I talk18:40about this in our courses. What about18:41Chevron? Well even Chevron had a pretty18:43decent little uh 24 hours. Now the18:45reason I bring up chevron is just more18:47of a interesting kind of chart and you18:49can see here that some people would call18:51that an inverse head and shoulders. You18:53never know of course full on but it is18:56certainly an interesting chart and we18:58are paying some attention to it. Now I18:59actually just go back here and show you19:01guys. Of course software was all the19:03rage up until pretty much last week and19:06the reason was it hit into that19:08resistance. Of course, the likes of19:09Microsoft coming into it, but a lot of19:12things were hitting resistance and this19:13is what we call crossorrelation and at19:15the moment software is taking a little19:17bit of a breather at least based on the19:19chart so far. What about gold? Well,19:21it's still sitting within the pit. So,19:23it's still sitting in a series of higher19:25highs and higher lows. So, we'll see how19:27gold plays over the next kind of 2419:30hours, 48 hours. And silver is doing19:32something similar, not necessarily19:33bearish, basically just having a19:35breather after a very good run. gold19:38stocks actually having the best19:40performance over the last five days.19:42Semiconductors of the major sectors19:44anyway, I'm pretty sure crack might have19:46done better. Now, let's have a look here19:48at semiconductors. Hit a call19:50resistance, fell a little bit. Uh, still19:52through the trend line, still slowly19:55slowly improving. The real 24 hours was19:58probably more about MU and um SanDisk20:01and Western Digital though. So, if we20:03have a look here at SanDisk, what20:05everybody was doing is they all had on20:07the internet, we talked about this in20:08our Monday live stream, subscribe. We do20:10a free Monday live stream as well. Uh,20:13so it's always good to see you guys20:14there. And right around here, we had all20:16these 50-day moving averages. And the20:18thing about it is it didn't really look20:20like they were going to act as20:21resistance because when you look back in20:23the history, the institutions hadn't20:25paid that much attention to those levels20:27either. So, it was the number one story20:29line I saw. didn't discuss it too much20:31till the live session but I probably20:33doesn't surprise me that initially the20:35markets rallied through that they are20:37trading a little bit down in after hours20:38but we did see a higher high on SanDisk20:41off some reports we wrote on um on X and20:45also West uh not west Western Digital um20:48where we go not the Australian stock20:50there also had an okay session but20:53didn't make a new higher high so what's20:55going on with the semiconductors well20:57basically speaking if we take a look at20:59the semis they've seen seen some21:00improvement, but I still expect them to21:02be quite kangarooy. And the reason is21:04because when you fall like this, it's21:06not a mistake. It's someone on Wall21:08Street saying, "That was a great run.21:10Fantastic. Thank you very much. See you.21:12Okay, later. Bye." Now, that doesn't21:14mean that it can't go up to a new high.21:16But somebody's definitely said, "Hey, I21:18uh I thought that was a pretty good21:20run." And that can lead into instability21:22and quite large daily movements, but21:24actually a whole lot of nothing. If you21:26want to see a similar chart, go have a21:27look at gold since January. That's21:29pretty much what it did. Up, down, up,21:31down on all round. XJO time, the21:34Australian market. Anything going on?21:35Not really. Just kind of went to a new21:37all-time high. Fall down a little bit21:40sitting on the daily 20. If we have a21:42look here at Tesla, Tesla kind of made21:44it up to around that 340 350 previous21:47support. Call resistance is everywhere21:49here. As you guys know, Tesla tends to21:52be, of course, more of a optionbased21:54stock. So, I'm pretty sure that's why21:56it's kind of sitting there. And I21:57thought I'd bring you SpaceX as well,21:59which continues to sit around that IPO22:02first bid price. So, you know, again,22:05important levels, but why? Well, we've22:07got a lot of call resistance, and it's22:09slowly becoming a thing that SpaceX is22:11becoming an options market. So, I'm22:13looking forward to actually watching the22:15options levels and bringing them to you22:17as well on the daily show. So, stay22:19tuned for that. On the cues, we're still22:21sitting at that 7:30 kind of resistance.22:24Again, you can see it here. This is the22:26main call resistance. So if the markets22:28choose to go high and say, you know22:30what, no problems with the bonds, don't22:31care. And they keep squeezing, then this22:34will probably create what we call a22:35positive gamma event. And at the moment,22:38the put support is sitting at uh just22:40around that 725. when we go have a look22:43at SPAC uh SpaceX S&P kind of like22:46SpaceX I guess it still make a series of22:48higher highs and higher lows but it did22:49slam straight into 7,800 which has been22:52where we've got a s super amount of22:54calls when you're looking at the most22:56recent um options expirations and22:59levels. So yeah, interesting zone23:01interesting times. We still have markets23:03mostly in higher highs, higher lows, but23:05here's the futures market action. You23:07can see here it's a bit of a sell in the23:09financials right now. And at the time of23:12this recording anyway, I'm just23:13scrolling down here. Really, the only23:14things up are yields, dollar,23:18oil, these are all correlated usually,23:20and VIX. So, could we be going to like a23:237650? That's where at least uh the next23:26anchored VWAP kind of seems to be23:28sitting. When it comes to Bitcoin, it is23:30doing not much. Still stuck in a range23:33or what we call a pit. So, until that23:36breaks out, you're not going to see too23:37much excitement from the Bitcoin markets23:39or the crypto markets. But really guys,23:41I think what's happening here at the23:42moment is a market that is starting to23:45make a decision really based on what is23:49going on with everything to do with the23:52bonds. You know, are we starting to see23:54the crack showing here in the AI kind of23:56run and how much capex debt issuance23:59there is? Look, it's too early to tell24:01that, but it's certainly something we24:02pay attention to. You want to be looking24:04at also different sector rotations. See,24:07let's say you were feeling bearish on24:08markets and you didn't like markets.24:10Well, there are other asset classes, you24:12know, they're things like gold or24:14commodities in general that often, you24:16know, kind of have a lot of those at24:18least initial kind of things that you24:20like as being about. If you're being24:22bullish, of course, you're going to be24:23looking more at the broader market, the24:25tech and all of those types of things,24:27the biotech, those types of stuff. So,24:29it's really interesting. This market's a24:31wonderful thing. There's so much24:32opportunity out there and I hope you24:34have a wonderful day, guys. Thanks so24:36much for watching. Subscribe, smash that24:38like button, and let me know down below24:39what do you think about big tech bonds24:42and the fact that uh Wall Street's24:44getting involved in such a big way to24:46actually affect US treasuries.
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