The 90-Second Read
on the flip
- Tuesday was a tech-led advance The S&P 500 rose 0.60% to 7,722.60, the Dow Jones Industrial Average gained 0.03% to 52,377.57, the Nasdaq Composite added 1.18% to 26,477.81 and the Russell 2000 rose 1.16% to 2,818.87. Volatility closed at 17.52.
- Futures hold a modest bid ES Dec read 7,764.25 at 3:24 AM, up 6.00 points from Tuesday's 7,758.25 settle and 20.25 points above Cannon's daily pivot of 7,744.00. The futures premium to cash is 35.65 points. Nasdaq futures are up 0.54%, while Dow futures are down 0.25% and Russell futures are down 0.19%.
- Crude jumps, gold slips December WTI read 101.96, up 2.06% from Tuesday's 99.90 settle, and Brent for January delivery read 111.42, up 1.86%. Gold read 4,047.8, down 0.66%. The 10-year Treasury yield closed at 4.99%.
- Fed day, then earnings The FOMC decision arrives at 2:00 PM against a prior range of 3.75%–4%. Alphabet's results call follows at 4:30 PM, and Thursday brings the first read on third-quarter growth and September inflation.
- The voices lean through the noise Tom Lee tells followers to look through the noise, Wilmington Trust's Meghan Shue takes a pretty dovish view of the Fed, and Yardeni says AI worries have pushed industrials from the second-best sector to the middle of the pack even as the group's forward earnings sit at a record.
- Levels into the open ES holds between first support at 7,715.25 and first resistance at 7,788.25. Second support is 7,671.00 and second resistance 7,817.00; third support is 7,642.25 and third resistance 7,861.25.
The Scoreboard
| Instrument | Level | Change | Session |
|---|---|---|---|
| S&P 500 | 7,722.60 | +0.60% | Tue close |
| Dow Jones Industrials | 52,377.57 | +0.03% | Tue close |
| Nasdaq Composite | 26,477.81 | +1.18% | Tue close |
| Russell 2000 | 2,818.87 | +1.16% | Tue close |
| ES Dec 26Tuesday settle 7,758.25 · 52-week high 7,897.5 | 7,764.25 | +0.08% | 3:24 AM ET |
| NQ Dec 26Tuesday settle 29,812.0 | 29,971.75 | +0.54% | 3:24 AM ET |
| YM Dec 26 | 52,449 | −0.25% | 3:24 AM ET |
| RTY Dec 26 | 2,823.0 | −0.19% | 3:24 AM ET |
| WTI Dec 26Tuesday settle 99.90 | 101.96 | +2.06% | 3:24 AM ET |
| Brent Jan 27 | 111.42 | +1.86% | 3:24 AM ET |
| Gold Dec 26Tuesday settle 4,074.6 | 4,047.8 | −0.66% | 3:24 AM ET |
| Silver · Copper · Natural gasTuesday settles, with the day's change | 54.51 · 6.65 · 3.00 | +0.85% · +1.71% · +0.89% | Tue settle |
| US 10-yearTreasury yield | 4.99% | Tue close | |
| BitcoinTuesday settle | 80,745 | +1.31% | Tue settle |
Rows marked 3:24 AM ET are taken from that time; index rows are Tuesday's closes and commodity and bitcoin settles are Cannon's Tuesday settlements.
Sentiment & Flow Gauges
| Gauge | Reading | Read |
|---|---|---|
| VIXTuesday close | 17.52 | ELEVATED Volatility sits in the high teens going into a Fed decision and a major earnings night. |
| Dealer gamma regimeTuesday cash vs. close-based flip | −1.56 | NEGATIVE The close sits a hair under the flip, so the regime label can change on a small move. |
| AAII sentimentWeekly survey · bearish share | 45.8% | BEARISH-LEANING Bears outnumber bulls by nine points in the latest survey, up from 41.6% a week earlier. |
| S&P 500 new highs / lows52-week · prior session | 12 / 8 | NARROW Both counts are low, with highs ahead of lows. |
| S&P 500 above 200-day | 58.9% | THIN Fewer than six in ten members sit above their long-term average. |
| S&P 500 up / down volume | 58% up | MIXED Buyers had a modest edge in Tuesday's volume. |
| High-yield spreadICE BofA HY OAS · prior session | 3.30% · +1bp w/w | STABLE Credit spreads moved little over the week. |
Flow Read
Tuesday's advance was led by technology and small caps on mixed volume, and participation measured against the 200-day average remains thin. With the index sitting on its flip and the Fed and a megacap earnings report both due before tonight's close, the early session is a test of whether buyers can carry the tape above that boundary or whether dealer hedging starts to lean against the move.
Yesterday's Calls Graded
No graded calls are carried this Wednesday; the grading resumes with the next full build.
Calendar & Scenario Map
| Time ET | Event | Consensus | Prior |
|---|---|---|---|
| Wed 8:30 | Advance trade balance in goods, wholesale inventories and retail inventories, September | — | −132.6B · 0.7% · 0.3% |
| Wed 2:00 PM | FOMC interest rate decision | — | 3.75%–4% |
| Wed 4:30 PM | Alphabet third-quarter results call | — | — |
| Thu 8:30 | Third-quarter GDP advance estimate | 3.2% | 2.2% |
| Thu 8:30 | Weekly jobless claims (week of Oct 24) | 200K | 194K |
| Thu 8:30 | September personal income · consumer spending | 0.3% · 0.6% | 0.2% · 0.9% |
| Thu 8:30 | September PCE prices, month over month · year over year | 0.5% · 3.7% | 0.3% · 3.4% |
| Thu 8:30 | September core PCE prices, month over month · year over year | 0.3% · 3.1% | 0.2% · 3% |
| Thu 4:30 PM | Fed H.4.1 balance sheet release (updates net liquidity) | — | — |
| Fri 8:30 | Third-quarter employment cost index | 0.8% | 0.9% |
| Fri 9:45 | Chicago business barometer, October | — | 58.8 |
Earnings estimates are omitted until results post.
Levels & Structure
Cannon's daily pivot for ES Dec is 7,744.00, with resistance at 7,788.25, 7,817.00 and 7,861.25 and support at 7,715.25, 7,671.00 and 7,642.25. The contract's 52-week high is 7,897.5 and its 52-week low is 6,567.
| Gamma level | SPX | ES Dec · +35.65 | Role in today's tape |
|---|---|---|---|
| Call wall | 8,000.00 | 8,036 | Unchanged from the prior read and 277 points above the close, well outside a normal day's range. |
| Gamma flip | 7,724.16 | 7,760 | The regime boundary, only 1.56 points above the close and down about 22 points from Monday's flip of 7,746.11. A tick higher returns the market to the damping side. |
| Put wall | 7,700.00 | 7,736 | Higher than the prior read of 7,650 and 23 points below the close, so the all-expiry floor keeps creeping toward the market. |
The November 20 SPX options chain, on a window running from 7,500 to just past 7,935, shows its largest call open interest above the market at 7,900, with 20,771 contracts, followed by 7,800 with 14,371 and 7,850 with 12,675. Below the market the largest put open interest at 7,700 stands at 24,691 contracts, with 19,593 at 7,600 and 10,580 at 7,550, but the lower edge of the window is not clean: 7,500 still holds 32,612 puts, so the put structure is a shelf running down to at least 7,500 rather than a single peak. The 7,700 strike also carries 22,211 calls that are now in the money, which makes it one of the most heavily traded strikes on the board. Open interest has died out at the upper edge, where 7,935 holds 488. In today's expiring ES weekly options, call open interest peaks above the market at 7,815 with 4,953 contracts, followed by 7,835 at 1,885 and 7,900 at 1,738, while puts peak at 7,700 with 6,515, ahead of 7,600 at 2,595. The all-expiry put wall at 7,700 lines up with the heaviest put strike in both chains, while the all-expiry call wall at 8,000 sits above the 7,900 peak in the November chain and well above today's 7,815 pin, which is information rather than error: the near-dated structure caps the market far closer than the aggregate does.
Institutional Positioning
Yardeni's overnight note says AI has been a double-edged sword for S&P 500 industrials: the sector was the second-best performer in July, then slid to sixth among the eleven sectors on worries about borrowing costs, investment returns and capital availability. His firm adds that the sector's price index sits below its 200-day average but remains in a multi-year uptrend, and that its forward earnings have just reached a record.
Shue, the firm's chief investment strategist, says Wilmington Trust has a pretty dovish take on the Fed, a view she gave ahead of today's decision.
Toney, the firm's founding managing partner, calls Anthropic's registration filing one of the most important documents we are going to see this cycle, tying the AI-financing debate to a company that now has to disclose its numbers.
Lee tells followers to look through the noise and says that underneath, things look good, pointing to technology momentum sitting far below its 52-week high as a sign the washout is deep.
Keller says the AI trade is heating up again, with technology and semiconductors leading, Tesla confirming a breakout above its 200-day average and volatility falling, and that the real test now comes from the Fed and the megacap earnings.
Desk Shift Tracker
| Voice | Stance | What moved |
|---|---|---|
| Michael HartnettBofA | BEARISH | Unchanged: sees the risk-off mood lasting until mid-November. |
| Ed YardeniYardeni Research | CAUTIOUS | New note: industrials slipped to sixth place on AI worries even as forward earnings hit a record. |
| Jeff deGraafRenaissance Macro Research | MIXED | Unchanged: month-end bounce expected in tech hardware and semis, with defensives taking a bigger share of returns over time. |
| Tom LeeFundstrat | BULLISH | Reiterates: look through the noise. |
| Scott RubnerCitadel Securities | NEUTRAL | Unchanged: expects the AI trade to rebound after the midterms. |
| Mark NewtonFundstrat | BULLISH | Single name: flags Emerson Electric pushing back to all-time highs. |
| David KellerSierra Alpha Research | NEUTRAL | AI trade heating up again; the Fed and earnings are the test. |
| Meghan ShueWilmington Trust | NEUTRAL | New this window: a pretty dovish take on the Fed. |
| Lo ToneyPlexo Capital | NEUTRAL | New this window: Anthropic's filing is a defining document of the cycle. |
| Mike WilsonMorgan Stanley | NEUTRAL | Discussed the correction in AI stocks; no level or call given. |
Macro Pressure Map
| Driver | Reading | Read |
|---|---|---|
| Net liquidityFed balance sheet − TGA − RRP · Wednesday levels · updates Thu | $5.81T · ▼ $61B w/w | DRAINING Last Wednesday's level; the next update follows Thursday's H.4.1. |
| Crude oilWTI Dec · Tuesday settle 99.90 | 101.96 | FIRMER Up 2.06% from the settle at 3:24 AM, with Brent up 1.86%. |
| 10-year Treasury yieldTuesday close | 4.99% | AT 5% Holding just under the 5% line into the rate decision. |
| GoldDec · Tuesday settle 4,074.6 | 4,047.8 | SOFTER Down 0.66% from the settle, still far above its 52-week low. |
Fed Watch
The committee announces its decision at 2:00 PM against a prior range of 3.75%–4%. Thursday morning brings the third-quarter GDP estimate and September PCE prices at 8:30, and the Fed's balance sheet release follows at 4:30 PM, which will refresh the net-liquidity reading.
What the Consensus Is Missing
The market is parked on its regime boundary going into the Fed
The close sits 1.56 points under the flip, and the put wall at 7,700 is the only nearby structure beneath it. A small move in either direction decides which side of the hedging regime the Fed statement is absorbed on, which makes the afternoon more sensitive than a 0.60% rally suggests.
Small caps joined the rally while futures for them are lagging
The Russell 2000 gained 1.16% on Tuesday, nearly double the S&P 500, yet Russell futures are down 0.19% this morning while Nasdaq futures are up 0.54%. Whether the broadening survives a rate decision with the 10-year just under 5% is a better read on participation than the thin internals alone.
Oil is rising into a rate meeting
Crude is up 2.06% overnight with Brent at 111.42, while the 10-year yield sits at 4.99%. Energy firming into a decision day adds a second route for inflation worries into the 2:00 PM statement, separate from Thursday's PCE print.
Cannon Intelligence Desk
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