The 90-Second Read
just above the flip
- Wednesday was a modest advance The S&P 500 rose 0.28% to 7,743.98, the Dow Jones Industrial Average gained 0.19% to 52,475.10, the Nasdaq Composite added 0.27% to 26,549.85 and the Russell 2000 rose 0.41% to 2,830.51. Volatility closed at 16.91.
- The Fed held, with two votes for a hike The committee kept the target range at 3.75%–4% by a 10–2 vote, with Lisa Cook and Beth Hammack preferring a quarter-point increase. The statement calls activity strong and inflation elevated. The 10-year Treasury yield rose 6 basis points to 5.05%, the 2-year slipped to 4.67% and the 30-year rose to 5.37%.
- Earnings split the megacaps Alphabet is down 10.2% in premarket trading after its results, ServiceNow is down about 19% and Microsoft is up 2.9%. Nasdaq futures are down 0.97%, while Russell futures are up 0.44%.
- Futures sit under the pivot ES Dec read 7,764.50 at 6:48 AM, 18.75 points under Wednesday's 7,783.25 settle and 18.50 below Cannon's daily pivot of 7,783.00. The futures premium to cash is 39.27 points.
- Crude and gold slip December WTI read 101.53, down 1.22% from Wednesday's 102.78 settle, and Brent for January delivery read 110.32, down 1.18%. Gold read 4,039.0, down 0.30%.
- The voices split on the Fed DoubleLine's Jeffrey Gundlach says the central bank should be raising rates and is behind the curve, while Fundstrat's Tom Lee reads the press conference as dovish and says big earnings beats are great because the Fed will not try to slow growth.
- Levels into the open ES holds between first support at 7,746.67 and first resistance at 7,814.67. Second support is 7,715.08 and second resistance 7,851.08; third support is 7,678.67 and third resistance 7,882.67.
The Scoreboard
| Instrument | Level | Change | Session |
|---|---|---|---|
| S&P 500 | 7,743.98 | +0.28% | Wed close |
| Dow Jones Industrials | 52,475.10 | +0.19% | Wed close |
| Nasdaq Composite | 26,549.85 | +0.27% | Wed close |
| Russell 2000 | 2,830.51 | +0.41% | Wed close |
| ES Dec 26Wednesday settle 7,783.25 · 52-week high 7,897.5 | 7,764.50 | −0.24% | 6:48 AM ET |
| NQ Dec 26Wednesday settle 29,979.5 | 29,689.50 | −0.97% | 6:48 AM ET |
| RTY Dec 26 | 2,852.1 | +0.44% | 6:48 AM ET |
| WTI Dec 26Wednesday settle 102.78 | 101.53 | −1.22% | 6:48 AM ET |
| Brent Jan 27 | 110.32 | −1.18% | 6:48 AM ET |
| Gold Dec 26Wednesday settle 4,051.6 | 4,039.0 | −0.30% | 6:48 AM ET |
| Silver · Copper · Natural gasWednesday settles, with the day's change | 53.67 · 6.67 · 3.03 | −0.07% · +0.86% · −1.47% | Wed settle |
| US 10-yearTreasury yield | 5.05% | +6bp | Wed close |
| BitcoinWednesday settle | 81,525 | +0.84% | Wed settle |
Rows marked 6:48 AM ET are taken from that time; index rows are Wednesday's closes, and the commodity and bitcoin rows are Cannon's Wednesday settlements.
Sentiment & Flow Gauges
| Gauge | Reading | Read |
|---|---|---|
| VIXWednesday close | 16.91 | MODERATE Volatility sits in the high teens ahead of the first read on third-quarter growth and September inflation. |
| Dealer gamma regimeWednesday cash vs. close-based flip | +22.27 | POSITIVE The close sits above the flip, though futures imply an open only a few points over it. |
| S&P 500 new highs / lows52-week · prior session | 18 / 11 | NARROW Both counts are low, with highs ahead of lows. |
| S&P 500 above 200-day | 58.2% | THIN Fewer than six in ten members sit above their long-term average. |
| S&P 500 up / down volume | 48% up | MIXED Neither buyers nor sellers held an edge in Wednesday's volume. |
| High-yield spreadICE BofA HY OAS · prior session | 3.18% · −15bp w/w | TIGHTENING Credit spreads narrowed over the week despite the hawkish dissents. |
Flow Read
Wednesday's gain was small and unevenly carried: advancers and decliners were nearly even, a little under six in ten index members sit above their 200-day average, and volume split evenly between buyers and sellers. With the index closing above the flip, dealer hedging should lean against moves, but the futures have already given back about 19 points, so the early session tests whether the damping regime holds against the Alphabet and ServiceNow selling and the 8:30 data.
Calendar & Scenario Map
| Time ET | Event | Consensus | Prior |
|---|---|---|---|
| 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 7,783.00, with resistance at 7,814.67, 7,851.08 and 7,882.67 and support at 7,746.67, 7,715.08 and 7,678.67. The contract's 52-week high is 7,897.5 and its 52-week low is 7,232.25.
| Gamma level | SPX | ES Dec · +39.27 | Role in today's tape |
|---|---|---|---|
| Call wall | 7,800.00 | 7,839 | Down from 8,000 at the prior read and 56 points above the close, so the all-expiry ceiling has moved much closer. |
| Gamma flip | 7,721.71 | 7,761 | The regime boundary, 22 points under the close and about 2 points lower than the prior flip of 7,724.16. A move back through it returns the market to the amplified side. |
| Put wall | 7,700.00 | 7,739 | Unchanged from the prior read and 44 points below the close, the nearest all-expiry floor. |
The November 20 SPX options chain, on a window running from 7,525 to 7,960, shows its largest call open interest above the market at 7,900, with 20,424 contracts, followed by 7,800 with 14,669 and 7,850 with 13,707. The window does not hold the heaviest strike, though: 8,000 sits beyond its upper edge with 106,299 calls and 86,839 puts, so the call structure is a shelf running up to the round number rather than a single peak. Below the market the largest put open interest inside the window is at 7,700 with 24,727 contracts, ahead of 7,600 with 18,972, and the 7,700 strike also carries 21,147 calls that are now in the money, which makes it one of the most heavily traded strikes on the board. Beyond the lower edge, 7,500 holds 41,409 puts, so the put structure is likewise a shelf running down to at least that strike. In today's expiring ES weekly options, call open interest peaks above the market at 7,850 with 1,787 contracts, just ahead of 7,875 at 1,754, while puts peak at 7,600 with 2,592, followed by 7,550 at 1,869 on the window's lower edge and 7,650 at 1,715. The all-expiry put wall at 7,700 lines up with the heaviest put strike inside the November chain, while the all-expiry call wall at 7,800 sits well under the 7,900 peak and the 8,000 shelf, which is information rather than error: the near-dated structure and the aggregate place the ceiling in different spots.
Institutional Positioning
Gundlach, the firm's chief executive, says the Fed should be raising interest rates, pointing to the two-year Treasury yield and a yield curve that steepened during the press conference, and calls the central bank a bit behind the curve. He argues that tighter financial conditions are coming from wider spreads on lower-quality credit, including AI-linked borrowers whose new bonds the market has not embraced at their ratings, and that this is the start of a trend rather than a blip. With headline inflation running with a four in front of it for months on firm energy prices, his base case is a hike in December, and he says he would welcome fewer policy meetings with real data between them.
Lee reads Chair Warsh's press conference as dovish and says big earnings beats are great because the Fed will not try to slow growth. In his own posts he argues that the central bank is walking back from its ultra-hawkish September stance and that raising rates now adds to inflation through extra interest income.
Yardeni's overnight note says AI jitters continue while the Fed pauses its hiking, with the S&P 500 back above its 50-day moving average and chip stocks bouncing. His weekly webcast names four sources of volatility, geopolitics, US politics, the Fed and AI, and argues that shocks could create buying opportunities given expected robust growth and earnings. He says he lowered his year-end S&P 500 target a month ago for valuation reasons.
Sieg, who runs the bank's wealth business, joined the afternoon show to discuss cracks forming in private credit, along with AI in wealth management. No figure or call from the segment was recovered.
Keller calls the S&P 500 chart meh while moving-average breadth stays strong, says gold shows decelerating trendlines whose break usually brings a strong upside reversal, and describes the index as going nowhere between 7,600 and 7,800 in a stock picker's market.
Desk Shift Tracker
| Voice | Stance | What moved |
|---|---|---|
| Jeffrey GundlachDoubleLine | CAUTIOUS | New: the Fed should be raising rates; base case is a December hike. |
| Michael HartnettBofA | BEARISH | Unchanged: sees the risk-off mood lasting until mid-November. |
| Tom LeeFundstrat | BULLISH | Reads the Fed press conference as dovish; big beats are great. |
| Ed YardeniYardeni Research | NEUTRAL | Year-end target lowered a month ago; sees buying opportunities if shocks hit. |
| Andy SiegCiti | CAUTIOUS | New: cracks forming in private credit. |
| David KellerSierra Alpha Research | NEUTRAL | Index stuck in a range; gold trendlines decelerating. |
| Scott RubnerCitadel Securities | NEUTRAL | Unchanged: expects the AI trade to rebound after the midterms. |
| Mike WilsonMorgan Stanley | NEUTRAL | Unchanged: no new level or call. |
Macro Pressure Map
| Driver | Reading | Read |
|---|---|---|
| Net liquidityFed balance sheet − TGA − RRP · Wednesday levels · updates Thu | $5.81T · ▼ $61B w/w | DRAINING The last Wednesday level in hand; the next update follows this afternoon's balance sheet release. |
| Crude oilWTI Dec · Wednesday settle 102.78 | 101.53 | EASIER Down 1.22% from the settle at 6:48 AM, with Brent down 1.18%. |
| Treasury curve2-year · 30-year · Wednesday close | 4.67% · 5.37% | STEEPER The 10-year rose 6 basis points and the 2-year fell 3 on a hold with two dissents for a hike. |
| GoldDec · Wednesday settle 4,051.6 | 4,039.0 | SOFTER Down 0.30% from the settle, still above its 52-week low. |
Portfolio Positioning
| Sleeve | Weight | How it is built |
|---|---|---|
| Equities | 30% | Kept away from the AI exposure concentrated in the cap-weighted index. |
| Bonds | 30% | A barbell, half in very safe domestic investment-grade paper with little corporate credit and half in local-currency emerging-market debt. |
| Commodities | 20% | Mostly the broad commodity index, shifting toward gold in steps as gold falls. |
| Dry powder | 20% | A short-duration, low-risk bond portfolio rather than bills or cash. |
Model mix described by Gundlach in his post-meeting interview.
Fed Watch
The committee held the target range at 3.75%–4% by a 10–2 vote, with Lisa Cook and Beth Hammack dissenting in favor of a quarter-point increase. The statement describes activity as expanding at a strong pace, says inflation remains elevated and pledges to deliver price stability. This morning's 8:30 releases of third-quarter GDP and September PCE prices are the first hard data since the decision, and the Fed's balance sheet release at 4:30 PM refreshes the net-liquidity reading.
What the Consensus Is Missing
The call wall dropped 200 points while the floor stayed put
The all-expiry ceiling moved from 8,000 to 7,800 and the put wall held at 7,700, which squeezes the dealer corridor to a band of about 100 points around a market that opens close to its flip. The heavy open interest at 8,000 in the November chain is still there, but the hedging map no longer treats it as the first cap.
Credit narrowed over the week even as the hawks dissented
The broad high-yield spread tightened over the past week, while the strategist most worried about credit points to wider spreads in lower-quality and AI-linked pockets. Which of the two is leading matters for a long end already above 5%, and the answer is in whether the broad index starts to follow the weak pockets.
The Fed held, yet the curve steepened
A hold would normally ease the front end, but the 2-year yield slipped only a little while the 10-year and 30-year rose, which reads as the market doubting that a pause is the end of tightening. Two dissents for a hike give that doubt a voting record heading into today's inflation data.
Cannon Intelligence Desk
LEGAL DISCLOSURE & RISK WARNING
Cannon Trading Company
This publication is provided by Cannon Trading Company for informational and educational purposes only. Content may include market commentary, technical observations, analyst opinions, and aggregated material derived from publicly available sources. While such information is believed to be reliable, Cannon Trading Company does not author, independently verify, endorse, or guarantee the accuracy, completeness, or timeliness of any third‑party information referenced or summarized herein.
The information, opinions, market data, and commentary contained in this publication are subject to change at any time without notice and do not constitute investment advice, a solicitation, or a recommendation to buy or sell any security, futures contract, option on futures, foreign currency transaction, or any other financial instrument.
Past performance is not indicative of future results.
Trading Futures, Options on Futures, retail off‑exchange foreign currency transactions, and other derivatives involves substantial risk of loss and is not suitable for all investors. You may lose all or more than your initial investment. Carefully consider whether trading is appropriate for you in light of your experience, objectives, financial resources, and other relevant circumstances.
Cannon Trading Company does not guarantee any profits and makes no representation that the strategies, ideas, analyses, or information presented will result in profitable trades or avoid losses. Any market views, analyst calls, forecasts, or third‑party commentary referenced reflect the opinions of their respective authors and may or may not align with the views of Cannon Trading Company.
HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.
ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NO INVOLVE FINACIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETLEY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.
Cannon Trading Company is registered solely as a commodities broker. Nothing contained herein constitutes the provision of investment advisory services.
© 2026 Cannon Trading Company, Inc. All rights reserved. cannontrading.com • 1‑800‑454‑9572 • (310) 859‑9572