Following futures positions of non-commercials are as of April 8, 2025.

10-year note: Currently net short 1,078.5k, up 215.2k.

Non-commercials raised net shorts in 10-year note futures by 24.9 percent this week to 1.08 million contracts – now merely 6.1 percent from the record 1.14 million contracts set in the week to October 1^st last year. Holdings then dropped to 567,935 contracts by the week to January 14^th. Back then, the 10-year treasury yield ticked 4.81 percent on that very day, that is January 14^th, and headed lower, subsequently reaching 4.11 percent on March 4^th and 3.89 percent on Friday the 4^th this month. Rates then shot up over six sessions to tag 4.59 percent intraday Friday this week, closing out at 4.49 percent, up 51 basis points for the week.

As these traders began to add to their holdings mid-January, they were obviously wrong initially, as yields continued lower. But, as mentioned earlier, the 10-year surged this week – past both the 50- and 200-day moving averages (4.34 percent and 4.22 percent respectively). Strangely, long-term treasurys and the dollar both took it on the chin at a time when investors were avoiding risk; traditionally, these two assets are treated as safe-haven. This could very well carry an important message. Time will tell.

For now, should the 10-year continue to rally, trendline resistance from October 2023 when it peaked at five percent extends to 4.75 percent.

30-year bond: Currently net short 18.2k, down 14.5k.

Major US economic releases for next week are as follows.

Retail sales (March), industrial production (March) and the NAHB housing market index (April) are on schedule for Wednesday.

Retail sales in February edged up 0.2 percent month-over-month to a seasonally adjusted annual rate of $722.7 billion. Sales reached a record $730.3 billion last December.

Capacity utilization rose 0.6 percent m/m in February to 78.2 percent – an eight-month high.

Homebuilder optimism declined three points m/m in March to 39, matching last August’s reading.

Thursday brings housing starts (March). February starts jumped 11.2 percent m/m to 1.5 million units (SAAR) – a two-month high.

WTI crude oil: Currently net long 157.4k, down 32.5k.

Last week’s downward momentum continued until Wednesday this week when West Texas Intermediate crude found buyers at $55, where horizontal support goes back a couple of decades. If this was breached, the next layer of support would lie at low-$50s, and then low-$40s.

Wednesday, the crude printed $55.12 intraday, only to reverse higher to close the session at $62.35. By the end of the week, it closed at $61.50/barrel, down 0.8 percent for the week.

A rally is possible near term. The best that could happen for now is strength toward $65-$66, which was breached six sessions ago. This horizontal support goes back years, with buyers also having shown up there last September.

In the meantime, US crude production in the week to April 4^th decreased 122,000 barrels per day week-over-week to 13.458 million b/d; output has come under slight pressure since registering a record 13.631 mb/d in the week to December 6^th. Crude imports dropped as well, down 277,000 b/d to 6.2 mb/d. As did stocks of gasoline and distillates – down 1.6 million barrels and 3.5 million barrels respectively to 236 million barrels and 111.1 million barrels. Crude inventory, however, rose 2.6 million barrels to 442.3 million barrels. Refinery utilization increased seven-tenths of a percentage point to 86.7 percent.

E-mini S&P 500: Currently net short 28.7k, up 9.7k.

For the second time in eight weeks, equity bulls managed to close the S&P 500 in the green this week. As opposed to last week’s 9.1 percent plunge, the large cap index finished up 5.7 percent to 5363.    

Before this, Monday began where last week left off, tagging 4835 intraday. By then, the S&P 500 was down 21.3 percent from the all-time high of 6147 posted on February 19^th. This was also where dual support rested: a rising trendline from the Covid lows of March 2020 and the highs of December 2021 and January 2022. Bids showed up aggressively.

More strength is possible in the sessions ahead. Immediately ahead, bears are likely to show up at 5500; Wednesday, the index rallied as high as 5481 before selling off a tad.

In the event of a drawdown, bulls need to defend 5260s.

Euro: Currently net long 60k, up 8.1k.

The euro is on the verge of a major breakout. In fact, it already has managed to poke its nose out of a falling trendline from July 2008 when it peaked at $1.604. This week’s 3.6-percent jump went a long way. This was the third straight up week – and a fifth in six.

Last September, on the 30^th, the currency reversed lower after facing rejection at $1.12 for six consecutive weeks. It stabilized early this year around $1.02s, which was defended for a whole month. This week’s massive rally pushed the euro well past that resistance, ending at $1.1360, ticking $1.1474 intraday Friday.

The daily is getting extended, and a successful breakout retest at $1.12 will surely telegraph that this week’s gains is no fluke.

Gold: Currently net long 200.7k, down 37.7k.

Gold shot up another 6.6 percent to $3,237/ounce this week. It has now rallied for 13 out of the last 15 weeks. The metal bottomed December 30^th last year when it ticked $2,608. Between then and now, gold has posted one after another record, breaking down one after another resistance.

Its most recent breakout came on March 13^th when it busted out of $2,950s, where it went sideways for a month. This Monday, this is where gold bugs showed up, as the session touched $2,957 intraday; earlier, gold came under slight pressure after rising to $3,168 on the 2^nd this month. The next time the yellow metal comes under pressure, bulls and bears are likely to lock heads at/around $3,160s.

Nasdaq (mini): Currently net long 24.3k, up 9.1k.

Until last week’s close, the Nasdaq 100 was down 21.7 percent from the February 19^th all-time high of 22223. As this week got underway, no relief was in sight. Intraday Monday, the tech-heavy index was down as much as 25.6 percent from its high, as it tagged 16542.

In November 2021, the index had peaked at 16765 before unraveling to bottom at 10441 by October next year. This was an important high and offered tech bulls an opportunity to step up and defend, and they accomplished that. By the end of the week, the Nasdaq 100 closed at 18690, up 7.4 percent for the week. In the prior week, it was down 9.8 percent.

Ahead, there is horizontal resistance at 19200s. As a matter of fact, Wednesday’s massive rally was stopped right there, as the index ticked 19234 intraday, before coming under pressure. This is the one to watch for now. Success here will give the bulls a chance to go after the 50- and 200-day (20269 and 20259 respectively); the averages have just completed a death cross. Speaking of which, the S&P 500 is on the brink of completing one, with the 50- and 200-day at 5761 and 5754 respectively.

Russell 2000 mini-index: Currently net short 12.7k, down 4.4k.

For nearly two years through December 2023, the Russell 2000 was rangebound between 1700 and 1900 before breaking out. The small cap index went on to post a new all-time high of 2466 on November 25^th last year, which just edged past the prior high of 2459 from November 2021. Things then went the other way.

Through this Wednesday’s intraday low of 1733, the Russell 2000 tumbled 29.7 percent from last November’s high. In fact, it hit 1730s in three different sessions, and the 1700 support held. By Friday, the index was up 1.8 percent for the week to 1860.

Small-cap bulls’ immediate hurdle lies at 1900. On Wednesday, the index did touch 1931 intraday, but only to get frittered away in the last two sessions. Thus far, genuine risk-on sentiment is not evident in small-caps.

US Dollar Index: Currently net long 2.9k, down 4.1k.

There is multi-year horizontal support just north of 100. This week, the US dollar index sank 3.1 percent to lose this support, closing at 99.76. Dollar bulls’ only consolation is that Friday’s session closed well off the intraday low of 99.03.

It has been quite a tumble, having peaked on January 13^th at a two-plus-year intraday high of 110.18. The 50- and 200-day (105.13 and 104.78 respectively) are on the verge of completing a death cross.

The daily is getting extended. Unless this week’s low gets compromised, bulls’ mettle sooner or later will be tested at lateral support at 103.20s, which was breached seven sessions ago.

VIX: Currently net short 14k, up 3.6k.

VIX opened the week with an intraday print of 60.13 on Monday. It is not often the volatility index has crossed 60. In the past, this has happened in October, November and December of 2008, March and April of 2020 and last August.

If a genuine unwinding gets underway, there is a long way to go on the downside. But it is too soon to declare that. Yes, with VIX closing the week down 7.75 points to 37.56, volatility bulls were unable to cling on to the weekly highs, but there are several layers of defendable support underneath.

For now, VIX probably heads lower. Levels to watch at this point include 28-29 and 22-23.

Thanks for reading!

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