(new market video update)
| | | Brandon Chapman here with you today. | And I'm telling you - we've got some very interesting developments setting up in the broader markets. | The S&P is just shrugging off any concern as we enter earnings season. But today I'm seeing something that caught my attention... | Someone just dropped 31,000 contracts on XLF puts. | That's massive put buying in financials right before JP Morgan and Wells Fargo report tomorrow morning. | And this isn't random - these traders are positioning for something big. | Look, we're sitting at nosebleed valuation levels. The cyclically adjusted PE ratio? | We're back at highs we haven't seen since July 2020. Before that, you'd have to go back to the 2000 bubble. | And yet the market keeps climbing. | What I want to see from these bank earnings: | | | | Trading revenues (especially in bonds where we've seen volatility from tariff concerns) Net interest income margins What they're setting aside for credit losses Whether they're pulling from credit reserves to juice earnings
| And obviously we've already seen downgrades and lowered expectations for the Mag 7 names like Apple and Microsoft. | Can we really hold record highs in the S&P 500 if this trend continues? | I just don't think so, and I explain why in today's video. | That volatility signal I track? | The 3-month to 1-month VIX ratio just touched 1.2 on Friday. That means 3-month volatility expectations are 20% higher than 30-day. We don't get here very often - last time was February 14th. | The market stayed within expected move ranges last week. | How often do we see that happen two consecutive weeks? Not many. We usually reach the extremes. | With inflation data Wednesday, August 1st tariffs looming, and talk of 30% tariffs on Mexico and EU... if earnings don't support these valuations, we become much more vulnerable. | Watch the full breakdown - I'm expecting fireworks this week, and those massive put buyers might know something we don't. | Let the games begin. | —Brandon Chapman | | | |
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