Cannon Pre-Market Briefing — Thursday, August 6, 2026

ACT ITrade Today

What's the setup, and what do I do before the bell.

01 — THE 90-SECOND READ

The Index Is Flat, the Dow Is at a Record, and the Nasdaq Is Doing Something Else Entirely.

REGIME

Positive Gamma · Cash Far Above the Flip

Options-positioning models put dealers net long roughly $54.7bn of gamma at spot, with the modelled flip at 7,052.63 — some 670 points beneath cash. The dampening mechanism is not merely intact; it has enormous room before it inverts. Rallies get sold into, dips get bought, and the range compresses until something forces a repricing from outside the options book.

Wednesday split three ways. The Dow closed at a record on its fifth consecutive up day. The S&P set an intraday all-time high of 7,793.68 and gave it all back to close down 0.17%. The Nasdaq Composite fell 0.83%. That is a value-and-cyclical session wearing a record headline, and this morning's tape is doing it again. Underneath it, the rates market has moved somewhere equities have not followed: the probability of a September cut is now exactly zero, and the debate is between a hold and a hike.

A hike is now the base case, and nobody is hedged for it
Fed funds futures put better than even odds on an increase at the 16 September meeting and nothing at all on a cut. The equity put/call ratio closed at its lowest since early June. Single-name flow is buying calls into a tightening bias. Those two facts belong to different markets.
The Nasdaq short is the most crowded it has been in three years
Leveraged funds are net short 58,000 Nasdaq-100 contracts, a three-year percentile of 3. Positioning has been more bearish only three percent of the time since 2023. A crowded short beneath a falling Nasdaq is fuel, not confirmation.
Good numbers are being punished, which is the tell
Axon beat and raised and fell 6.5%. Sandisk beat its own guide with datacentre revenue up 64% sequentially and fell anyway. When the beat is not enough, the market has stopped underwriting the multiple and started auditing it.
Claims matter more than usual because tomorrow matters enormously
Wednesday's ADP printed 44K, the weakest since January against roughly 75K expected. A soft claims number is the market's first chance to price a labour crack before tomorrow's official read.
Two independent technicians have marked the same floor
Bespoke and Sierra Alpha's David Keller both published 7,600 as the level converting from June resistance into support, and dealer models put the put wall at 7,500. A well-defined shelf beneath a tape nobody is hedging.

02 — THE SCOREBOARD

The Board & Yesterday's Calls

Instrument	Last	Chg	Read
ES Sep E-mini S&P 500	7,755.25	+5.75	Settled 7,749.50; session high 7,820.25 is the 52-week high.
NQ Sep E-mini Nasdaq 100	29,396.75	−218.25	The only major contract lower. Memory and AI-capex names.
YM Sep E-mini Dow	54,618	+124	Sixth up day if it holds.
RTY Sep E-mini Russell	3,028.30	+2.90	Participating in the value rotation.
S&P 500 cash Wed close	7,723.55	−0.17%	Reversed off an intraday record; the 7,736.52 Aug 4 close is the high mark.
Dow cash Wed close	54,349.12	+0.49%	Record — the index owning the fewest AI dollars.
WTI Sep	75.87	+0.86%	Rebuilding after Tuesday's collapse.
Brent Oct	80.27	+1.03%	Back over 80, roughly Goldman's stated fair value.
Gold Dec	4,325.22	+0.47%	Multi-week high, running with equities not against them.
Silver Sep / Copper Sep	61.948 / 6.7855	−0.55% / +0.86%	Copper settled at a record.
Nat gas Sep	2.665	−0.86%	Storage at 10:30.
10Y / 2Y	4.637% / 4.210%	+2.0 / +1.8bp	Curve +42.7bp; 30Y 5.184%.
DXY / USD-JPY EUR/USD 1.1542	99.63 / 157.92	+0.08% / +0.11%	Dollar still sub-100 post-intervention; yen drifting up off the 155.23 low.
Bitcoin	64,639	+0.87%	—
VIX	16.00	+1.20%	Closed 15.81; Aug future 17.67.
WPP / SoundHound pre-market gainers	— / 7.89	+24.3% / +22.7%	WPP's H1 operating profit £398mn, 13% clear of estimates.
HubSpot / AppLovin pre-market losers	192.00 / —	−23.3% / −20%+	Both beat something, both fell on the guide.
Sandisk / WDC pre-market	1,350.50 / 519.17	−5.4% / −5.4%	Memory 39% and 31% off June highs.

Index rows are Wednesday's closes; futures, commodities, rates, FX and single names are live pre-market prints.

Sentiment & Flow Gauges

Gauge	Reading	What it says
CNN Fear & Greed	60	GREED Out of the Fear zone it held through late July.
AAII bulls / bears	37.0 / 38.0	Spread −1.0pt from −11.1pt a week ago — a big swing toward optimism with no change in price.
CBOE total put/call	0.88	Prior 0.69. The index line is where the institutional hedge lives — still being paid for.
CBOE equity put/call	0.46	Lowest since early June. Single-name flow is buying calls.
Sep FOMC pricing	56.9% hike	43.1% hold, 0.0% cut, off a 350–375bp target.
Net dealer gamma	+$54.7bn	POS GAMMA Cash 670 points above the flip. Deeply vol-suppressing.
NQ leveraged-fund net	−58,000	Three-year percentile 3 — the most crowded equity short on the board.

The flow picture is internally contradictory in a way worth naming. Sentiment has flipped bullish — AAII closed eleven points of pessimism in a single week and Fear & Greed crossed over — while positioning has not. Leveraged funds are still net short the S&P by 297,000 contracts. Weekly flows turned positive for the first time in three weeks at $11.83bn, but the money went to large caps while mid-caps saw outflows. Opinion has turned faster than exposure, and the book is long enough gamma that neither gets tested until the data forces it.

Yesterday's Calls Graded

HIT

Cannon Desk — the six-week short-covering bid in the E-mini is spent, and subsequent upside has to be bought by discretionary longs and buybacks, which lack a built-in floor. The index made a fresh intraday record and could not hold it, closing lower on the day.

HIT

Cannon Desk — with no credible low mark on the Street, institutional hedges are harder to authorise; watch the put/call and the vol complex. Equity put/call fell to 0.46 and VIX dropped 4.2% on a session the index reversed hard.

HIT

Cannon Desk — the regime-change signal is a close back beneath the put wall, not another failure at the call wall. The tape failed at the highs, the regime did not change, and the Dow set a record in the same session.

MISS

Ed Yardeni, Yardeni Research — carried as signalling another target raise on forward earnings up 30% and a four-year-high ISM. He did not raise. He held 8,250 and spent Wednesday night arguing the Fed should be tightening instead.

OPEN

Ray Dalio on AI-complex multiples, Torsten Slok on the 60/40, Arthur Hayes on datacentre credit, Peter Berezin on an earnings rather than valuation bubble, and Binky Chadha's raised earnings base all carry forward.

03 — CALENDAR & SCENARIO MAP

Two Labour Prints, Thirty Hours Apart

Time ET	Event	Cons.	Prior
08:30	Initial jobless claims, wk 8/1	203K	197K
08:30	Continuing claims	1,790K	1,782K
08:30	Nonfarm productivity, Q2 prelim	+0.6%	+0.3%
08:30	Unit labor costs, Q2 prelim	+2.2%	+1.8%
10:00	Wholesale inventories, Jun	+0.3%	+0.3%
10:30	EIA natural gas storage	+30 Bcf	+28 Bcf
17:30	Musalem (St. Louis Fed) speaks	—	—
Fri 08:30	July employment report	+100K	+57K
Fri 08:30	Unemployment rate / AHE	4.2% / +0.3%	4.2%

Before the bell: ConocoPhillips, Datadog, Constellation Energy, Zoetis, Becton Dickinson, Parker Hannifin, Keurig Dr Pepper, Kenvue, Warner Bros Discovery, EPAM, Unity. After the close: Airbnb, The Trade Desk, Cloudflare, Atlassian, Twilio, DraftKings, Roku.

Initial claims08:30 ET · see calendar

SOFT — CLAIMS ABOVE ~215K

Desks would read it against Wednesday's ADP as the second labour signal in two days pointing the same way. The front end regains optionality, the September hike probability comes down, and the rotation that has been favouring cyclicals over duration-sensitive growth loses part of its rationale.

HOT — CLAIMS BELOW ~195K

Pricing frames a labour market that has not cracked at all, leaving the hike bias intact into tomorrow's payroll. Tight labour with unit labor costs accelerating is the combination that has historically pressured the long end hardest, and the 30-year is already there.

July payrollsFri 08:30 ET · see calendar

SOFT — BELOW ~75K

Two consecutive sub-100K prints would be the first genuine test of a Fed that has held five straight meetings and is priced to tighten. Desks frame this as the scenario where the September distribution collapses toward a hold and the curve re-steepens from the front.

HOT — ABOVE ~140K

Confirms the ADP print as noise and hands the hawks the argument into Jackson Hole. The path most cited is not a September hike priced at 70%; it is the long end selling off while equities try to hold a record — the configuration the bears have been waiting for.

Scenario language describes how desks and pricing frame outcomes. It is not a recommendation.

04 — PIVOT POINTS & GAMMA MAP

Where the Levels Sit

Cannon Daily Levels · Pivots, Support & Resistance

Cannon Daily Levels · Trend & 52-Week Range

Dealer Gamma Map

Gamma level	SPX	ES Sep · +25.95	Role in today's tape
Call wall	8,000.00	8,025.95	Ceiling, far enough away that it is not shaping intraday flow.
Gamma flip	7,052.63	7,078.58	Regime boundary. The book is emphatically long gamma.
Put wall	7,500.00	7,525.95	Floor — the first level where dealer hedging works with a decline rather than against it.

Levels are modelled from the Wednesday close by a public dealer-gamma model across four nearby expirations. The ES column adds the front-month basis — the Sep settle less the SPX cash close.

The distance between cash and the flip is the number that matters: there is no plausible one-day path that inverts the regime, so the vol-suppressing mechanism holds through both today's claims and tomorrow's payroll unless the move is genuinely violent. Michael Kramer at Mott Capital made the related point Tuesday: gamma and delta both flipped hard from negative into positive, and once that has happened the squeeze that produced the run is finished.

Volatility Curve & Breadth

VIX closed at 15.81 against a three-month VIX3M of 18.95 — the eighty-third consecutive day of contango, a regime holding on more than ninety percent of sessions since 2010, so its persistence is not itself informative. VVIX at 92.57 and SKEW back to 126.41 from an elevated 139.96 two sessions earlier both say the tail bid has come off.

Breadth is where Wednesday's split shows cleanly. 70.57% of the index remains above its 200-day moving average and new 52-week highs beat new lows 213 to 61, a net of +152. But the day's advance-decline was −738 with only 41% of issues advancing. Leadership is healthy and participation is not, which puts the weakness in the illiquid tail rather than the names that carry the index — a materially better configuration than the reverse.

ACT IIThe Read

Who is driving it, and what changed since yesterday.

05 — INSTITUTIONAL POSITIONING

New Voices and Moved Positions

Ed Yardeni Yardeni Research NEW TURN

Wednesday night he published under the title "US Economy Is Fine & The Fed Should Be Turning More Hawkish," citing consumer spending up 3.3%, business investment up 8.4% and core inflation at 3.8%. His year-end target is unchanged at 8,250, the highest on the Street. The separation worth noting: this is a bull case running through a strong economy rather than cheap money, arguing for tightening while holding the Street's most aggressive number. Read against Michael Hartnett at BofA — who wants the Fed forced into aggressive hikes as the bearish trigger — the two agree entirely on where policy goes and completely disagree on what it does to equities.

Scott Rubner Citadel Securities NEW

His framing line is that July did not change the structural bull market, it reset it. The supporting work: the largest week of retail equity selling since 2022, with semiconductor and memory selling exceeding the prior record more than fivefold; leveraged ETF assets down over $60bn from the June peak; and semiconductors' index weight falling from nearly 20% to 16%. The forward catalyst is mechanical rather than fundamental — only about 45% of the index was eligible to repurchase mid-reporting, rising as blackouts expire through August.

Jeff deGraaf Renaissance Macro Research NEW

He closed Wednesday's session urging clients to let go of rallying names that are not acting right — a distribution warning rather than a bearish call, landing precisely on what the breadth data shows: an index making highs while most issues decline. No tickers were published with the segment, but the instruction is to sell strength, and it is the first of its kind from a technician of his standing in this move.

Jonathan Krinsky BTIG MOVED · BEAR → BULL

He has turned tactically constructive on exactly the group he had been warning about, telling CNBC on Monday that he expects strength in semiconductors and in the momentum trade in early August. That reverses a bearish stance on semis downside and a momentum unwind, and puts him directly opposite Morgan Stanley in the cleanest disagreement on the board this morning. It is a tactical window rather than a thesis change — and the memory complex down another five percent this morning is not helping it.

Mike Wilson Morgan Stanley TARGET CORRECTED

His Monday note argues the recovery is moving from early-cycle to mid-cycle, with the market rewarding stable earnings, margins and free cash flow over low-quality high beta — a rotation he declines to read as bearish. On the group in dispute: semis may bounce but are unlikely to lead again, a classic early-cycle group giving way to hyperscalers that have already outperformed them by roughly thirty percent over four weeks. The AI cycle is not over, he adds, but the easy money in the most crowded beneficiaries may be. The 7,800 year-end number still circulating under his name is his November 2025 figure.

06 — DESK SHIFT TRACKER

The Board of Voices

Voice	Firm	Stance	Takeaway
Ed Yardeni	Yardeni Research	BULL	Street-high target held; now arguing for a hawkish Fed. See above.
Michael Hartnett	BofA	BEAR	Calls the Fed nakedly dovish; retreat and rotate rather than reload until a bond-vigilante event forces a policy U-turn. Jackson Hole is his date.
Mike Wilson	Morgan Stanley	QUALITY	Mid-cycle rotation into quality; hyperscalers over semis. See above.
Jonathan Krinsky	BTIG	BULL · TACTICAL	Long semis and momentum for early August. See above.
Jeff deGraaf	Renaissance Macro	CAUTION	Sell the names that are rising without confirming. See above.
Scott Rubner	Citadel Securities	FLOW	Positioning reset inside an intact bid. See above.
Tom Lee	Fundstrat	BULL	Now sees 7,900–8,000 within August on 2027 EPS up $8 to $408 — awkwardly against his own standing warning of a 10–20% drawdown across August to October.
Ben Snider	Goldman Sachs	NEUTRAL	Targets unchanged. A path call: across thirteen midterm years since 1974 the median return from early August to Election Day is zero, with +6% in the three months after.
Katie Stockton	Fairlead Strategies	MOVED · CONSTRUCTIVE	The index has lifted out of consolidation with more bottom-up breakouts; improved momentum makes a more favourable environment for adding exposure.
Ryan Detrick	Carson Group	SEASONAL CAUTION	August and September are the worst two months; when June and July are both down the rest of the year falls more than half the time, averaging −2.5%. Still holds a +15–18% full-year view.
Charlie Bilello	Creative Planning	MEAN REVERSION	Record 16.7% Q2 margins, paired with Grantham on margins as the most mean-reverting series in finance. Value beating growth by twenty-plus points year-to-date, the widest on record.
David Keller	Sierra Alpha Research	TECHNICIAN	Marked the former resistance shelf as new support; separately has gold breaking trendline resistance.
Savita Subramanian	BofA	DARK	The August Sell Side Indicator, due in the first days of the month, has not surfaced. The seasonality statistics circulating under the BofA name are the firm's technical work, not hers.

07 — MACRO PRESSURE MAP

Where the Data Is Actually Pressing

Labour. Wednesday's ADP was the weakest since January and lands into tomorrow's payroll. The productivity release carries more weight than usual: with the Fed priced to tighten, the relationship between output per hour and what labour costs either validates or dismantles the hawkish case. Claims have been running at their lowest since January 2024, and the expansion is 74 months old against a 67-month post-1949 average.

The yen. Japan's Ministry of Finance intervened alone on 30 July for an estimated ¥8.45 trillion — likely Tokyo's largest single-day operation ever — after the yen touched its weakest since 1986. The United States joined on 31 July and South Korea sold reserves to buy won. This is the first coordinated US-Japan currency operation since 1998, and equity desks have almost entirely absorbed it as a non-event. Japanese ten-year yields near 2.90% are at a twenty-six-year high.

Oil. Helima Croft at RBC published Wednesday with a view considerably more sceptical than the tape, expecting the conflict measured in years rather than months with nuclear terms, Strait control and sanctions all still to negotiate: wars are easy to start and not easy to exit. Her supply number is the one that matters — over 100 million barrels removed from circulation, roughly one month of buffer, with the system reaching the limits of its safeguards. Refining capacity is fully utilised, so any further outage passes straight into product prices, diesel first. Against that, Goldman expects an $80–$90 range absent a confirmed deal or a significant escalation. Wednesday's EIA report showed a surprise 2.5 million barrel crude build against an expected draw.

Hormuz. Iran has reached an agreement with Oman on a temporary shipping route, with drafting in its final stage and reporting pointing to a sixty-day interim arrangement to reopen the waterway without tolls. The sticking point is that the draft gives Tehran more control over transiting vessels than Washington has said it will accept. Nothing is signed as of this morning.

Supply. Wednesday's quarterly refunding set $125bn against $96.3bn maturing on 15 August, with coupon sizes held for at least several more quarters. Auctions run 11–13 August; nothing today.

08 — PORTFOLIO POSITIONING

The Names That Own Today

SpaceX. The lock-up expires today, releasing up to 911.5 million insider shares worth roughly $116bn — more than the entire public float, staggered so insiders may sell up to the first twenty percent from today. The stock fell 7.3% Wednesday on its first post-IPO print, where revenue nearly doubled and operating losses narrowed but capital expenditure guidance did the damage, and it sits near all-time lows. Morgan Stanley reads fundamentals as largely unchanged. It is the largest single supply event on the calendar, in a session already carrying two labour prints.

The AI complex is now priced by capital intensity rather than growth. Nvidia rose 3.7% on Wednesday after SpaceX committed to its chips exclusively for its data centres — and a broad chipmaker gauge still fell 1.4% the same day. Memory is where the pressure concentrates, with Sandisk selling off on a beat and taking Western Digital with it. Goldman puts combined hyperscaler and Oracle capital spending at close to $800bn in 2026 — the number underwriting the whole complex, now read by investors as a cost rather than as evidence of demand.

Wednesday's reaction function. HubSpot fell on the guide with Oppenheimer downgrading, and MercadoLibre grew revenue 50% and fell 6.8% on margin compression. The clean winner was Charles River Laboratories, up 11.4% to top the index on a raised full-year guide.

Outside the AI argument entirely. WPP's move is its biggest since 1992, on organic revenue falling considerably less than feared. SoundHound's follows a raised full-year range. The part of the market with no AI capital-expenditure exposure is having a materially better week than the part that does.

09 — FED WATCH

Priced to Tighten

Kevin Warsh's committee has held five consecutive meetings, with three dissents for a hike in July. There is no blackout: St. Louis Fed President Alberto Musalem speaks this evening, and Jackson Hole runs 27–29 August. Goldman's Jan Hatzius raised the structural issue this week: cutting forward guidance leaves markets unable to know which data the committee weights, making policy lag the economy and become destabilising rather than stabilising. Absent a chair distilling the committee, the loudest and most frequent speakers carry the most weight whether or not they represent the median voter — which is why an evening speech from a regional president moves more than it used to.

ACT IIIThe Edge

What everyone else is not saying this morning.

10 — WHAT THE CONSENSUS IS MISSING

Three Things

Four houses share one index target and none of them share a denominator.

Goldman, Morgan Stanley and Deutsche Bank all carry 8,000 for year-end. They do not agree on what the index earns. Deutsche's Binky Chadha raised 2026 earnings per share to $358 from $342 and 2027 to $420 from $390 on Monday, on a record 87% beat rate. Goldman is at $340/$385, Citi at $350/$400. That is a spread of eighteen dollars on this year and thirty-five on next, which at the same index level implies roughly 22.3x against 23.5x on 2026. The convergence that reads as consensus is nothing of the kind: three desks arrived at one number from earnings bases that cannot all be right, and the one that is wrong gets re-rated through the multiple rather than the target.

Gold is rising with equities, and that is the intervention nobody is pricing.

Gold is at a multi-week high this morning after its best session since February, and it is doing so alongside a record Dow rather than against it. The conventional reading is geopolitical hedging into the Hormuz talks. The less-discussed reading is monetary: the dollar index is still beneath 100 five sessions after an intervention whose explicit purpose was to stop a currency depreciating disorderly. And 2026 is the first year since 1980 with records in gold, silver and copper together. A simultaneous bid across all three industrial and monetary metals, with the dollar suppressed by official action, is not a geopolitical trade. Equity desks filed the yen operation under foreign exchange and moved on.

The most crowded short on the board is sitting under the index everyone has stopped defending.

Leveraged funds carry the Nasdaq-100 at a three-year short extreme while it is the one major index falling both Wednesday and again this morning. The reflexive read is confirmation: the shorts are right, the AI complex is rolling over. The mechanical read is the opposite. The index-weight loss, the leveraged-product liquidation and the record retail selling all happened in July. The de-risking is behind the tape, not in front of it. What is left is a crowded short into a buyback window widening to roughly 85% eligibility over the next ten days — an asymmetry the weak tape is disguising rather than confirming.

11 — SIGN-OFF

Eli G Levy

Cannon Pre-Market Briefing · Contact Cannon Trading Company
eli@cannontrading.com · cannontrading.com

Free. Always.

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The Funds Market Has Priced the Cut Out Entirely and Put Better Than Even Odds on a Hike.