Calm Before the Spike
Markets look asleep, but danger is ticking beneath the surface—watch bonds, oil, and the poor low on ES.
🔍 Macro Overview: Snooze Calendar, Loud Signals
This week’s economic calendar is thin—but don’t be fooled. The lack of scheduled events often creates the perfect vacuum for volatility to creep in from unexpected catalysts.
🗓️ Key Data Drops – Thursday, July 24th:
8:30am: Unemployment Claims (Forecast: 229K, Previous: 221K)
9:45am: Flash Manufacturing PMI (Forecast: 52.7, Previous: 52.9)
9:45am: Flash Services PMI (Forecast: 53.0, Previous: 52.9)
None of these scream regime change—but that’s exactly when markets love to reprice risk.
💓 The Market's Heartbeat (Macro Thermometer)
Let’s run the vitals:
VIX at 16.40 → Still low. Market's tranquil. Below 15 = complacency danger zone. Any hiccup could spike fear.
TLT at 85.24 → Near critical. A dip below 85 enters Yield Shock Risk. Bond vigilantes could wake up.
DXY at 98.35 → Weak dollar = global Risk-On. But we’re approaching a key pivot—above 100 = neutral.
CL (Crude) at 66.33 → Stable, but dangerously close to falling under 65 = Recession Fear/Demand Panic.
HYG at 80.25 → Credit market is screaming Risk-On. Junk loves this environment.
HG at 5.626 → Pricing in a Global Boom. Strong underlying demand pressure.
💣 Interpretation:
On the surface, the tone is Risk-On Lite. But dig deeper and danger is coiling beneath. With VIX this low, any volatility shock will be amplified. TLT teetering at 85 signals the bond market’s discomfort—if yields jump, equities might finally care.
🧭 ES Futures Outlook (ESU25)
Current positioning is delicate. We’re coiled just inside the previous session's Initial Balance—this is the pause before either a clean breakout… or a nasty trap.
🔹 Poor Low at 6323
Just sitting there—unfinished business. Markets love symmetry, and this poor low is a neon target if sellers step in.
🔹 Last Week’s Balance:
VAL: 6292.75
VAH: 6345
POC: 6330.25
🔹 Previous Session:
VAL: 6324.50
VAH: 6338.75
POC: 6330.75
We’re still rotating within the previous session’s value area—but any rejection from VAH (6338.75) opens the 80% Rule play: look for price to move toward the POC (6330) and then the poor low (6323).
Playbook:
Below 6338.75 → Watch for acceptance = 80% Rule to 6330 → 6323
Break below 6323 → Triggers poor low repair, possibly cascading toward 6292
Above 6349 → Potential for breakout continuation to new All-Time Highs.
Low VIX doesn't mean low risk—it means the cost of being wrong is about to get more expensive.
⚠️ Big Picture Warning
Markets are acting like it’s still Q1—credit is loose, gas is hot, and volatility is asleep. But the internals (especially TLT and VIX) are whispering a different story. This is a complacent market on edge.
Don’t trade the calm—trade what happens after it breaks.
Stay sharp,
Trade well,
Stratomass
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