Technical Indicator Summary Daily RSIs for the Russell 2000 and S&P 500 are in neutral territory (>30 and <70). Technical Review The December S&P 500 bounced slightly on Thursday, settling @ 7724.00. The top end of Hedgeye’s risk range coming into Thursday’s session was 7853 while the bottom of Hedgeye’s risk range was 7664 (red lines on the chart above). The VIX finished Wednesday’s session near 16.42. Option dealer gamma ended in neutral territory as of Wednesday’s close (the gamma flip line is in blue on the daily chart above). When option dealer gamma is positive, option dealers mechanically BUY weakness and SELL strength to hedge their exposure. Positive gamma for option dealers increases the odds of LOWER realized volatility and SMALLER percentage moves up or down from one day to the next. 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 Thursday’s bounce in bonds (lower treasury yields) stuck all the way to Thursday’s close. In fact, Thursday’s price action was the reverse of Wednesday as treasury yields rose early in the day only to slip lower into Thursday’s close. Daily RSIs for Treasury Bonds/Notes and the Russell 2000 were oversold, so a bounce on Thursday ahead of Friday’s September jobs report is not a surprise (when bond prices go up, yields go down). Likewise, the daily RSI for the US Dollar Index is signaling short-term overbought. CTA funds have begun selling their near max long equity exposure and that Vol Control funds are hovering over the sell button. If the December S&P 500 futures close below the option dealer gamma flip line (currently 7723), realized volatility may increase enough to put CTAs, Vol Control funds and options dealers all on the sell side at the same time. In other words, the S&P 500 is in a fragile set-up. In fact, Tier1 Alpha estimates that a 2% drop in the S&P 500 could generate $30 billion in notional selling from Vol Control funds alone. In case you missed it, here is some great free content from Hedgeye: • Sept. 24: WATCH | 2027 Market Bloodbath: Worse Than 2022? • Sept. 23: McCullough: Why the Falling Yield Curve is a Big Deal • Sept. 22: McCullough: Yield Curve Is The Biggest Problem Since 2022 • Sept. 15: Keith McCullough and Mike Taylor Discuss the AI Bubble According to the CME’s FedWatch Tool, rate markets are pricing a 26.0% chance that the Fed hikes rates by 25 bps at its October 28, 2026 FOMC meeting.

Technical Indicator Summary The Daily RSI for the Russell 2000 is now oversold (<30) while the daily RSI for the S&P 500 remains in neutral territory (>30 and <70). Technical Review The December S&P 500 lost -0.21% on Wednesday, settling @ 7715.50. The top end of Hedgeye’s risk range coming into Wednesday’s session was 7856 while the bottom of Hedgeye’s risk range was 7653 (red lines on the chart above). The VIX finished Wednesday’s session near 16.49. Option dealer gamma ended in neutral territory as of Wednesday’s close (the gamma flip line is in blue on the daily chart above). When option dealer gamma is positive, option dealers mechanically BUY weakness and SELL strength to hedge their exposure. Positive gamma for option dealers increases the odds of LOWER realized volatility and SMALLER percentage moves up or down from one day to the next. 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 A bounce in bonds (lower treasury yields) on a cooler than expected PCE inflation report gave equities a lift early on Wednesday. But the bounce in bonds was short-lived as sellers took advantage of the bounce in bond prices to drive treasury yields up on the US 10-year Note and US 30-year Bond to finish at fresh 24-year highs. Led by the tech sector, the S&P 500 spent most of Wednesday’s session in the green. However, selling in the last 30 minutes, possibly quarterly index rebalancing flows, pushed the S&P 500 into the red. CTA funds have begun selling their near max long equity exposure and that Vol Control funds are hovering over the sell button. If the December S&P 500 futures close below option dealer gamma flip line, realized volatility may increase enough to put CTAs, Vol Control funds and options dealers all on the sell side at the same time. In other words, the S&P 500 is in a fragile set-up. Estimates suggest that a 2% drop in the S&P 500 could generate $30 billion in notional selling from Vol Control funds alone. In case you missed it, here is some great free content from Hedgeye: • Sept. 24: WATCH | 2027 Market Bloodbath: Worse Than 2022? • Sept. 23: McCullough: Why the Falling Yield Curve is a Big Deal • Sept. 22: McCullough: Yield Curve Is The Biggest Problem Since 2022 • Sept. 15: Keith McCullough and Mike Taylor Discuss the AI Bubble According to the CME’s FedWatch Tool, rate markets are pricing a 37.1% chance that the Fed hikes rates by 25 bps at its October 28, 2026 FOMC meeting.

Technical Indicator Summary Daily RSIs for the S&P 500 and Russell 2000 are in neutral territory (>30 and <70). Technical Review The December S&P 500 slipped -0.19% on Tuesday, settling @ 7732.00. The top end of Hedgeye’s risk range coming into Tuesday’s session was 7858 while the bottom of Hedgeye’s risk range was 7614 (red lines on the chart above). The VIX finished Tuesday’s session near 16.04. Option dealer gamma remains in positive territory as of Tuesday’s close (the gamma flip line is in blue on the daily chart above). When option dealer gamma is positive, option dealers mechanically BUY weakness and SELL strength to hedge their exposure. Positive gamma for option dealers increases the odds of LOWER realized volatility and SMALLER percentage moves up or down from one day to the next. 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 Trump administration is planning another 40 million barrel release from the SPR to get them through the upcoming election. That is literally draining the SPR to its operational minimum level near 250 million barrels. In any event, front month oil futures fell nearly 4% and that gave the S&P 500 some support on Tuesday. However, on Tuesday treasury yields continued to rise and the US Dollar index maintained its near vertical ascent. The 10 year US treasury yield is now at its highest level since 2002. That may not seem alarming until you realize that the US federal debt in June 2008 was “only” $8.9 trillion. The US federal debt is now above $40 trillion. Tier1 Alpha notes that CTA funds have begun selling their near max long equity exposure and that Vol Control funds are hovering over the sell button. If the December S&P 500 falls below the 7712 option dealer gamma flip line, realized volatility will increase putting CTAs, Vol Control funds and options dealers all on the sell side at the same time. In other words, the S&P 500 has a fragile set-up. In case you missed it, here is some great free content from Hedgeye: • Sept. 24: WATCH | 2027 Market Bloodbath: Worse Than 2022? • Sept. 23: McCullough: Why the Falling Yield Curve is a Big Deal • Sept. 22: McCullough: Yield Curve Is The Biggest Problem Since 2022 • Sept. 15: Keith McCullough and Mike Taylor Discuss the AI Bubble According to the CME’s FedWatch Tool, rate markets are pricing a 47.1% chance that the Fed hikes rates by 25 bps at its October 28, 2026 FOMC meeting.