Technical Indicator Summary Daily RSIs for the S&P 500 and Russell 2000 are in neutral territory (>30 and <70). Technical Review The March S&P 500 bounced +0.85% on Monday, settling @ 6801.00. The S&P 500 closed near trend/support flip line on Monday. The VIX retreated to 25.50 on Monday, at the upper end of the volatility chop regime. Above 29, the volatility regime flips to the escalated volatility regime where markets tend to crash. Option dealer gamma remains in negative mode as of Monday’s close. When option dealer gamma is negative, option dealers mechanically SELL weakness and BUY strength to hedge their exposure. Negative gamma for option dealers increases the odds of HIGHER realized volatility and LARGER percentage moves up or down from one day to the next. Market Outlook The bull case for equities, in part, relies on President Trump quickly extracting the United Staes from the war with Iran (in the days ahead) and Iran agreeing to allow oil to flow through the Strait of Hormuz. On Sunday night, WTI oil futures surged to $119.48 before closing on Monday at $94.77. Oil prices have slipped further since Monday’s close to trade at $83.63 as of this writing. The fall in oil prices along with the comeback in US equity futures coincides with a comment from president Trump on Monday that the war with Iran is “very complete,” implying that a de-escalation may be near. That being said, we are not interested in chasing headlines. We are interested in multiple price signals that have turned bearish nearly across the board for the Nasdaq 100, S&P 500 and Russell 2000. We are also tracking option flows that suggest any further flare up in equity market volatility has the potential to unleash a significant unwind (selling) from CTA strategies. As if that was not enough, the global macro landscape could also be forecasting a strong whiff of stagflation in the next 6 months. So, buckle up for a bumpy ride! According to the CME’s FedWatch Tool, rate markets are now pricing a 14.7% probability that the Fed cuts rates by the April 29 FOMC meeting (the last FOMC meeting of the Jerome Powell era). There is also an FOMC meeting on March 18 where odds of a rate cut are now 2.6%.

Technical Indicator Summary Daily RSIs for the S&P 500 and Russell 2000 are in neutral territory (>30 and <70). Technical Review The March S&P 500 sank -1.34% on Friday, settling @ 6743.75. The S&P 500 finally closed below trend support near the 6800 level. The VIX finished Friday’s session at 29.69, its highest close since April 2025. Anytime the VIX closes above 29, that is a huge red flag for risk. Option dealer gamma remains in negative mode as of Friday’s close. When option dealer gamma is negative, option dealers mechanically SELL weakness and BUY strength to hedge their exposure. Negative gamma for option dealers increases the odds of HIGHER realized volatility and LARGER percentage moves up or down from one day to the next. Market Outlook We started Friday’s session with the Nasdaq 100 and all of the MAG-7 stocks in bearish trends. The S&P 500 joined the bear party by breaking trend support with a decisive close below 6800. Surging oil prices thanks to an escalating war in the Middle East, a weak jobs report, and ugly headlines from Blackrock all conspired to sour the mood on Wall Street. Surging energy prices and a weak labor report suggest a stag-flationary near-term macro outlook. There was nothing bullish about Friday’s close. When the VIX is above 29, that is a dangerous volatility regime. We are proactively positioned for more volatility and ThetaTrader clients who have been following our alerts should have seen their account values increase despite Friday’s negative price action. According to the CME’s FedWatch Tool, rate markets are now pricing a 18.3% probability that the Fed cuts rates by the April 29 FOMC meeting (the last FOMC meeting of the Jerome Powell era). There is also an FOMC meeting on March 18 where odds of a rate cut are now 4.5%.

Technical Indicator Summary Daily RSIs for the S&P 500 and Russell 2000 are in neutral territory (>30 and <70). Technical Review The March S&P 500 lost -0.59% on Thursday, settling @ 6835.25. Lower Bollinger band support is 6795. Upper Bollinger band resistance is 6991. Option dealer gamma remains in negative mode as of Thursday’s close. When option dealer gamma is negative, option dealers mechanically SELL weakness and BUY strength to hedge their exposure. Negative gamma for option dealers increases the odds of HIGHER realized volatility and LARGER percentage moves up or down from one day to the next. Market Outlook For the fourth day in a row, the S&P 500 traded below trend support near 6800 before rallying to close above this key level. As we have previously noted, the Nasdaq 100 remains in a bearish trend which likely signals that it is only a matter of time before the S&P 500 breaks its trend support as well. On Friday we get the February jobs report. Since we already know that the Powell Fed is not going to cut rates, a weak jobs number on Friday morning may trigger stagflationary worries as energy prices continue to work their way higher. So, we would not be surprised if bad jobs data is a negative catalyst for equities. According to the CME’s FedWatch Tool, rate markets are now pricing a 12.6% probability that the Fed cuts rates by the April 29 FOMC meeting (the last FOMC meeting of the Jerome Powell era). There is also an FOMC meeting on March 18 where odds of a rate cut are now 4.7%.