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Learn To Embrace New Highs
Daily Update on SPY, QQQ, TLT, USO, BTC, COIN, Mag-7, Gold, PLTR
Yimin Xu
June 26, 2025
Hi YXI friends,
Being early is as good as being wrong. And bears are ALWAYS early.
This means bears only capitulate at the top. Before we reach the top, bears simply shift their timelines forward.
Investors should train their mental muscles to embrace, not to be scared of, new highs.
When will the next crash come? I will let our ML models and chart technical whisper as they come. But that day is not today.
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Let’s dive in!
Table of Contents
DISCLAIMER: This newsletter is strictly educational. Any information or analysis in this note is not an offer to sell or the solicitation of an offer to buy any securities. Nothing in this note is intended to be investment advice and nor should it be relied upon to make investment decisions. Any opinions, analyses, or probabilities expressed in this note are those of the author as of the note's date of publication and are subject to change without notice.
1. Asset Correlations
Today, we take a look at the latest 20-day correlations of the macro assets.
We start with SPY and QQQ. They currently trade with strong negative correlAtions with the US Dollar (UUP) at -0.72. USD moves ahead of equity indices, so watching the Dollar strength will give us a lot of clues where SPY and QQQ are headed.
SPY and QQQ are positively correlated with TLT, which is not a permanent relationship. Currently, investors are buying bonds and equities together - lower yields are supportive of stocks.
VXX (Vix ETF) runs counter to risk assets with steeply negative correlations. VIX is at a very benign 16 today, but is prone to quick spikes.
GLD and USO run a positive relationship together. Escalations in the Middle East has sent oil prices higher due to supply shocks and Gold prices higher due to safe-haven demand.
Finally, Bitcoin trades at a modestly positive correlation with stocks and small correlations with everything else (apart from VXX). That’s probably a good property to have for diversification purpose.
References
Ticker | Description |
|---|---|
FXY | Japanese yen vs. U.S. dollar |
UUP | U.S. dollar against major currencies |
TLT | 20+ Year Treasury Bond ETF |
TIP | US Treasury Inflation-Protected |
HYG | High Yield Corporate Bond ETF |
IAGG | Investment-grade bonds ex-US |
SPY | S&P 500 |
QQQ | Nasdaq-100 |
IWM | Russell 2000 |
GLD | Gold |
USO | WTI crude oil futures |
VXX | VIX |
IBIT | Bitcoin (spot-price) |
2. SPY, QQQ, (SPDW)
SPDW is updated every Monday.
SPY opens today at the all time high. Investors must fight their mean-reversion human nature and learn that making new highs is a very positive development for markets.
SPY could challenge $625 next at the 1.618 extension. We want to see a higher high in the RSI at the same time to avoid a bearish divergence.
QQQ has now moved ABOVE the trend line resistance, pushing above the 1.618 extension.
Should it successfully move past it, we will have to revise our waves (iv) and (v) expectations higher. $552 is the next immediate stop.
3. FOMC Projections & Rates Futures
FOMC Projections
We use the Fed Funds futures market to understand the market expectations of future FOMC interest rate decisions.
FOMC Date | Before Meeting | Post Meeting | Hike/ Cut in % |
|---|---|---|---|
07/30/25 | 4.33 | 4.28 | -0.05 |
09/17/25 | 4.28 | 4.08 | -0.2 |
11/05/25 | 4.08 | 3.83 | -0.25 |
12/17/25 | 3.83 | 3.68 | -0.15 |
01/28/26 | 3.68 | 3.53 | -0.15 |
03/18/26 | 3.53 | 3.43 | -0.1 |
05/06/26 | 3.43 | 3.33 | -0.1 |
06/17/26 | 3.33 | 3.23 | -0.1 |
07/29/26 | 3.23 | 3.13 | -0.1 |
Trump wants to undermine Powell, not just by repeatedly berating the Fed Chair in public, but also by an early appointment so the market could shift their focus away from an exiting Chair.
Faced with immense political pressure, the market starts to pen in 2 near-certain cuts in September and November. The odds have shifted to 4-5 cuts in the next 12 months.
3-month SOFR Futures Yields
4. Summary Of Today’s 4-3-2-1 Ratings
SPY, QQQ, BTC, AAPL, AMZN, GOOGL, META, MSFT, NVDA, TSLA
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