Discussion
SPY is currently stuck around the mid-day highs from last Friday, yet IG CDX has broken down decisively below the levels at the Friday high (52.50 on Friday versus 51.70 today). Taking current IG CDX levels back over the last 10 trading days, it’s clear SPY wants to get back to the $523-$524 level.
Combined with the fact Bitcoin is up big today and nearing its prior highs despite a decisive move up in rates, this is an equity market primed to move decisively higher in the coming days on a number of potential catalysts: 1) a better than expected CPI report on Wednesday, 2) better than expected US Treasury auctions this week, and/or 3) a hostage deal that at least temporarily leads to a cease-fire in the Israel-Hamas war.