Big Picture - 100 Day Break

The kangaroo market continued last week, where with each passing day felt like a new market. One day buyers are holding support and things look good then sellers show there hand and push the market back into the recent pivot low. 

With the close of the week the S&P showed us a textbook "h" pattern, where lower price action is often in store. The market also tested the 100 day and broke below it twice last week.

Now back in November we got close to testing it but buyers came back quickly. This time the buyers could not hold the line and as we saw back in 2025 when the 100 day was tested and broke below, we saw lower price action.

As much as it feels like putting lipstick on a pig to find some reason as to why the market needs to break 700. The writing is clearly on the wall that we need to embrace this shakeout to come. 

Even the VIX has been showing signs that we should expect some chop very soon as we have seen that this 30 area tends to be resistance. Under 30, its normal price action for the most part. but when it starts to get above it and fear increases, we get those shakeout moves lower. Where the bottoms get put in when VIX really pops near 60. 

The last few months with the market in this really tight range, it's been slim picking on the swing trading side of things for the most part. We have found a few trades each week to put cash to work. But overall, less has been more and that is totally ok. 

These markets are good reminders as to why we want to have trading as an added source of income, instead of the main source. Imagine for a moment that you were trading full time in this market and having to pay the bills. For those who have another source of income outside of the normal 9-5, these are great times to focus on that endeavor. For myself, tax season has kept me plenty busy where the slow market has caused little frustration because I do need to put cash to work. I can wait for the right spots when they appear. On the tax side, for a moment, if you earned any overtime in 2025, make sure your accountant takes advantage of the tax savings on overtime work that apply for 2025. We have saved quite a few members already with that new tax benefit. If you are filing single you can have up to $12,500 or $25,000 if married in overtime wages exempt from being taxed this year. This is an easy $1,000 to $1,500 increase in your tax refund. 

It does seem like the market needs to at least push towards the 650 area to get outside of the tiny range it's been in before we see any real climb to new highs. As much as it feels like these slow markets will last forever, they do change, we just need to continue to practice some sit out power until we get the real shakeout move. 

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Macro Rotation Outlook