Before the open, we got the PCE data, which came in well below the consensus, and the natural reaction was for the fed funds market to further reduce the odds of a hike in October. The S&Ps bounced a little as yields and the dollar softened. The metals also popped a little. However, all of that would then reverse shortly thereafter.
After opening up a touch, the S&Ps began chopping sideways and slowly rolled over again as yields (especially in the long end) and the dollar firmed back up as crude bounced about a percent.
For the close, the S&Ps would slide in the final minutes to go out on the lows of the day with a loss of quarter of a percent.
The dollar began the day lower on the PCE data but then firmed to go out on the highs with a gain of just a freckle per the DXY. BTC was flat.
Yields soared in the long end to new highs, with the 10yr hitting 5.29%, while the 2yr only rose 1 bp, which once again steepened the curve and pushed the 2/10 spread back to nearly its high for the month.
Commodities were mostly a little lower, except for crude, which added another 2 percent after we failed to get a "deal" overnight. "Talks" supposedly continue, and I still think Trump is dying to do a deal well ahead of the midterms to push crude and gasoline down.
Gold and silver popped on the PCE but then rolled over and slumped to go out near their lows of the day with a loss of half a percent for gold and nearly 2 percent for silver, which also took it to a marginal new low for the week.
The GDX opened higher just shy of the 5 dma and then reversed to go out on the lows with a loss of over a percent to just shy of Monday's lows.
Gold, silver, and GDX all ended below the 5 dma, so the bears remain in statistically in charge.
With the odds of a rate hike in October now headed for virtually zero, further downside in the metals seems limited, especially with the yield curve now rapidly steepening, which is typically bullish for the metals.
With quarter-end being today, there was a lot of noise. Some of the action in silver looked even a little panicky.
Speaking of silver, by undercutting its low slightly today, it is also now sporting a bullish positive RSI divergence on the hourly charts.
With that said, until the metals and miners recover the 5 dma, the trend continues to favor the bears, and that's just a matter of probability.
My gold model remained on a Tier 3 BUY for a 3rd session.
Positions: Short SPY, QQQ, MDY, and IWM. Long DBA, STRC, and IBIT.
Metals: Long GDXU, AGQ, and SHNNY. I added SLV 57 calls for Friday for an average of 8 cents after my calls for today got smoked (ugh).
Stay flexible my friends...