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Boy, what's about to happen in the market?

I mean, is the CPI that comes out this Thursday about to derail the two biggest bullish trades in the market currently?

Here's the thing... everyone's piling into gold and bonds right now. Gold's outperforming every sector. TLT's breaking out. The dollar's weakening 1% against gold while the S&P sits flat.

But here's what 95% of people are missing about Thursday's CPI print...

We're already expecting 0.3% core inflation - that's above the Fed's 2% target when annualized. The year-over-year number? Supposed to hit 2.9%.

And the Fed's signaling they're willing to accept this "above trend inflation" because of job market concerns.

But what if that number comes in significantly hotter than expectations?

I'm seeing some serious action in the options market that tells a different story than what everyone's positioning for:

• 14,000 TLT put contracts traded at the 88 strike (this week's expiration)
  • 5,500 GDX bear spread contracts (buying 63 puts, selling 60 puts)
  • Volume significantly greater than open interest on these bearish plays

Look, we're pricing in a weaker dollar, rate cuts, recession fears... all the stuff that helps gold and bonds.

But the risk right now isn't to the upside. The risk is to the downside.

Because if that CPI print forces the Fed to reconsider their dovish stance - even slightly - you could see gold pullback toward 60-63 on GDX and TLT retest down to 88 or even 87.50.

The breadth of today's rally is really, really poor. Only 39 advancing issues versus 63 declining in the S&P 100. The whole move is being carried by a handful of tech names while the dollar weakness does the heavy lifting.

Which direction is more vulnerable to seeing a bigger move? Right now, the bigger move is likely to the downside in gold and bonds.

And here's the crazy part I reveal in today's video...

The specific options flow patterns I'm tracking, the exact retracement levels smart money is targeting, and why this particular setup reminds me of something I've only seen a few times before.

Don't let Thursday's CPI catch you positioned like everyone else.

Video Length: 00:12:18

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