A summary of an interview with World Gold Council Senior Market Strategist, Joe Cavatoni.
The full interview: Gold’s Volatility Is Actually A Good Thing
Gold/Silver: 2026 Q1 Precious Metal Contracts
The Office of the Comptroller of the Currency released its Quarterly Report on Bank Trading Activity and Derivatives Activities. Figure 18 on page 43 shows notional amounts of precious metals derivative contract exposure by maturity held by Insured U.S. Commercial Banks and Savings Associations. A total value of $820 billion in precious metal contracts were recorded.
Note: Beginning January 1, 2022, the largest banks are required to calculate their derivative exposure amount for regulatory capital purposes using the Standardized Approach for Counterparty Credit Risk (SA-CCR). Under SA-CCR, gold derivatives are considered precious metals derivative contracts rather than an exchange rate derivative contract, resulting in an increase in reported precious metals derivative contracts compared with prior quarters. Refer to the call report instructions and OCC Bulletin 2020-7, “Standardized Approach for Counterparty Credit Risk: Final Rule,” for additional information on the SA-CCR exposure calculation Source: Call reports, Schedule RC-R
Source: Quarterly Report on Bank Trading and Derivatives Activities
Note that this information is for educational purposes only and not a recommendation.
Dollar: Non-Commercial Trader Position
The current U.S. Dollar Non-Commercial Futures Trader net-long position is similar to where it was in mid-June 2008. This by itself would not be out of the ordinary, but other futures products such as Copper, Euro, Gold, Natural Gas, S&P500, and Silver also have net-long positions that are similar to where they were in mid-June 2008. Just an observation.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: Reallocation of Capital
On June 24, 2026 it was noted that the 5 Day Average Put/Call ratio was expected to continue moving upward toward 1.0 as markets start a pullback. At this point the ratio is 0.994 as the S&P500 and SPY continue to decline. Market Makers did not disappoint on Friday with significant volume and the reallocation of capital. Volume was well above average for stocks such as Apple, Amazon, Honeywell, Coca-Cola, and Microsoft. A pullback in the markets is still expected as volatility increases.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: NAAIM Index – June 24, 2026
As of June 24, 2026 the NAAIM Exposure Index moved up to 98.59. The index continues to follow the 2025 pattern. Investment managers are currently leveraged long and bullish, as they were on August 20, 2025.
With the end of the second quarter it was observed in Dow stock trading that investment managers, hedge funds, etc., were reducing their risk by moving into stocks with lower volatility. Very large seven figure block trades crossed the tape on June 18, 2026 (Options Expiration) as well as June 22 and June 24.
Note that this information is for educational purposes only and not a recommendation.
Data source: NAAIM Exposure Index
Dow/S&P500/NASDAQ: Put/Call Positioning
Between April and June 2026, Market Makers were in the process of positioning for another pullback in the markets as the CBOE Options Total Put/Call 5 Day Moving Average dropped three times below the 0.80 level. The 5 Day Average Put/Call ratio is currently expected to continue moving upward toward 1.0 as markets start a pullback.
During the end of options expiration week on June 18, 2026, the S&P500 rose 1.08% and the Semiconductor ETF, SOXX moved up 6.62%. The financial media provided investors with a positive outlook prior to a long weekend in order to keep them in the market.
S&P 500 closes higher, Nasdaq climbs nearly 2% as chips fuel comeback from Fed sell-off
The type of activity mentioned above also occurred between December 2017 and January 2018. During that time the CBOE Options Total Put/Call 5 Day Moving Average dropped three times below the 0.80 level. A decline in the S&P500 followed in January 2018 and ended in late March 2018, as shown in the following chart.
During the options expiration week on January 17, 2018 the Dow closed above 26,000 for the first time with a 1.08% move. The S&P500 moved up 0.77%. The media convinced investors that the bull market was still intact prior to a sharp decline starting on January 30, 2018.
Dow spikes 322 points, closes above 26,000 for the first time
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
S&P500/NASDAQ: IPO Trends
Over 400 companies had an IPO in 2000. Three out of the largest group of 25 were issued in the first half of the year. Anthropic and OpenAI have submitted an initial confidential registration form (S-1) to the SEC. It remains to be seen if they will follow through with an IPO. If they do, it could look like the first half of 2000 with SpaceX leading the way.
The 431 Companies That Had Their IPO In 2000
The 25 Biggest U.S. IPOs of All Time
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: NAAIM Index – June 17, 2026
As of June 17, 2026 the NAAIM Exposure Index moved up to 92.83. This position is similar to where it was on August 6, 2025 with a reading of 96.25. The index continues to follow the 2025 pattern. Investment managers are hedged and bullish.
Note that this information is for educational purposes only and not a recommendation.
Data source: NAAIM Exposure Index
Dow: Rising Wedge
While tech stocks are grabbing most of the attention, Dow algorithms have been working on developing a rising wedge since April 2026. A similar rising wedge was formed in 2008 prior to a three month decline. It would be prudent to pay attention to this since there is a high probability that a decline will occur.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: MSFT 2026 vs 2000
Up to this point Microsoft’s (MSFT) stock price is in a structural position similar to where it was in July 2000. This time AI is involved. On March 31, 2026 it was noted that Microsoft closed their worst (first) quarter since the 2008 financial crisis. It is interesting that the Microsoft Market Maker, exchange insiders, etc., are using a similar price structure from 2000. It is also unknown if this same pattern will continue. But, if it does the outlook for MSFT is not good.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
S&P500: SPY 15 Minute Chart Gaps
The S&P500 opened with a gap up on Monday, June 15, 2026. Reviewing 15-minute gaps in the SPY and other S&P500 derivative ETF products, there is a high probability the index will pull back to fill the June 15, 2026 opening gap. When this gap is filled additional information may be available to determine the overall direction of stock markets.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
AAII Sentiment Survey – June 10, 2026
Over the last week investors started to lean quickly toward a bearish position as markets moved lower. There is a bearish reading of 47.70% and bullish reading of 30.40%. This aligns with other sentiment indicators. A move above 50% for the AAIIBear indicator should be monitored closely for markets changing direction.
Note that this information is for educational purposes only and not a recommendation.
AAII Asset Allocation Survey for May 2026
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: NAAIM Index – June 10, 2026
As of June 10, 2026 the NAAIM Exposure Index moved down to 79.27. This position is similar to where it was on July 23, 2025 with a reading of 81.07. For the moment the index continues to follow the 2025 pattern. Investment managers are hedged and bullish.
Note that this information is for educational purposes only and not a recommendation.
Data source: NAAIM Exposure Index
Dow/S&P500/NASDAQ: Market Low Range Readings
While markets move lower at an increasing rate, the CNN Fear & Greed Index will adjust accordingly. Two key readings have been under observation at market lows over the last few years that fall into the following parameters.
1. CNN Fear & Greed Index less than or equal to 20.
2. CNN Put and Call Options Index greater than or equal to 0.90.
Generally, when readings have met these parameters at the same time, markets are in, or are moving into, a range of another low as shown in the following chart.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: Apple 2025 – 2026 Pattern
It is apparent that Market Maker and Liquidity Provider algorithms are providing a road map for Apple based on its 2024 structure. A move below the lower trend line will indicate a steady short term decline is in progress. This will provide all the liquidity needed for exchange insiders when markets turn and move higher.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Bitcoin: Long Term Expectations
As of June 2, 2026 futures traders confirmed their expectation that Bitcoin would move higher in the coming months. This indicates price movements should follow the Engrbytrade™ Bitcoin Model based on Euro values between 1971 and 1985. Therefore Bitcoin should make one final push above 100,000 before making a long term decline.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: Semiconductor Index
The SOX Semiconductor Index finished the week with a 4.74% decline and a very long shooting star candle. Semiconductor stocks such as AMD, Micron, and NVIDIA also ended lower with similar candles for the week. Typically, a sharp decline would be expected to follow this type of candle. But, the Fear & Greed cycle has already moved into the Fear category, as it did in late 2022. It hit a low of 35 on December 30, 2022 before the S&P500 and NASDAQ started moving higher. At this point a brief decline would be expected before markets start moving higher.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: NAAIM Index – June 3, 2026
As of June 3, 2026 the NAAIM Exposure Index moved down to 86.82. This position is similar to July 9, 2025. What followed in 2025 was the Dow moved sideways with a quick drop at the end of July, after the Fed Reserve Meeting on July 29-30, 2025. The next Fed meeting is scheduled for June 16-17, 2026. A quick decline after this meeting would not be a surprise. Investment managers are hedged and bullish.
Note that this information is for educational purposes only and not a recommendation.
Data source: NAAIM Exposure Index
S&P500/NASDAQ: IGV Trading Structure
For those who are watching this, here is a quick note to illustrate that IGV has a trading pattern history similar to the following chart.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: NAAIM Index – May 27 2026
As of May 27, 2026 the NAAIM Exposure Index moved to 98.39. Up until May 13, 2026 patterns in the index were similar to late 2024. Currently the index resembles 2025. The February – April 2025 broad based sell off, due to an increase in tariffs, pulled the index down to 35.16 before recovering in May and June. The latest decline, due to the Iran war, started in February 2026 and pulled the index down to 60.24. During this decline buyers were focused on technology stocks, as shown in the Expanded Tech Software Sector ETF (IGV). Heavy volume between February and April indicated insiders, market makers, etc. were buying whatever they could. This type of activity should push markets higher going into the summer months. Investment Managers remain bullish.
Note that this information is for educational purposes only and not a recommendation.
Data source: NAAIM Exposure Index
Silver: Future Parabolic Move
On December 24, 2023 an ascending triangle was identified in silver with the expectation of it moving higher. This by itself would not necessarily support a sharp rise in the metal. It is the bailout and economic rescue plans approved by congress that flooded the economy with money. Going back to 1970 every time Congress approved a series of bills, it was followed by an increase in the price of metals. Typically, within a year of when the last bill was approved silver started to move higher. It has been 10 months 27 days since July 4, 2025 when President Trump approved the $3.4 trillion Big Beautiful Bill Act. This was noted on March 30, 2026. Even though silver moved up sharply in 2025, the next move up is expected to be parabolic.
References:
March 30, 2026 $3.4Trillion Economic Stimulus Package
December 24, 2024 Silver Ascending Triangle
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow/S&P500/NASDAQ: Investor Sentiment
After several weeks of watching a sharp rise in stock markets during April and May, investor optimism would be expected to move higher. In this case Investment Managers were optimistic, but AAII investors were not. The Fear & Greed indicator did not move above the Greed range. It appears retail investors are in a holding pattern waiting for a resolution to the middle east conflict, higher gas prices, inflation, layoffs, and more. The following charts show a snapshot of investor sentiment.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
AAII Sentiment Survey – https://www.aaii.com/sentiment-survey
CNN Fear & Greed Index – https://www.cnn.com/markets/fear-and-greed
NAAIM Exposure Index – https://naaim.org/programs/naaim-exposure-index/
S&P500: Fear & Greed Alignment
Fear & Greed data since August 2022 shows the current position of the index is similar to April 25, 2023, December 6, 2023 and June 13, 2025. So far, it trends well with the S&P500. Markets could turn down as early as July 2026, after the SpaceX IPO. This is a work in progress and additional data will be needed to identify relationships with other indicators.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Interest Rates: TLT Trend Line
On May 4, 2026 it was noted that over the last four years the 30 Year rate chart structure has been moving higher on a 21.82 degree trend line. Along with this TLT followed an 8.32 degree trend line in 2011, 2018, and 2026. In October and November 2018 rates moved higher and then fell. TLT briefly dropped below its trend line during this time before moving higher. That may also be possible in 2026.. In each case Market Makers accumulated a significant amount of inventory before TLT moved higher. Whether it is a repeat of algorithms, policies, procedures, plans, etc., Market Makers are certainly consistent in this case.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
S&P500/NASDAQ: CISCO Structure
History provides some insight to Market Maker activities. One example is Cisco. Based on the 2000 Cisco chart structure there was a period between 1993 and 1998 when Market Makers accumulated a significant amount of inventory. As this occurred there were 2 cycles between 1997 and 1998 before it started to move significantly higher.
It appears Market Makers are repeating their work from 2000. The 2026 Cisco chart reflects a similar structure where Market Makers accumulated inventory between 2010 and early 2016. There were also 2 cycles between 2019 and 2022 before it started to move significantly higher.
At this point it is unknown if Market Makers will continue to use the 2000 structure as a model. If they do it will be an impressive move.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
