Today, we take a look at the neutral range for the SPX along with mixed signaling for both the bulls and bears. We then discuss inflation, value factor, peak supply chain hysterics, and a new bull leg in the loonie, plus more.

1. I’m seeing mixed signals and expecting neutral-ranging action until either of these levels are broken. Hedge, play both sides, and wait for the tape to tips its hand.

2. One for the bulls, we have positive seasonal tailwinds after passing the dip in seasonal weakness on Oct. 9.

3. On the other hand, we have elevated valuations with a Fed that looks to be abandoning fiat as inflation proves less transient than first hoped.

4. If inflation stays elevated, then we should expect to see valuations continue to contract (chart via Crestmont Research).

5. But as @MacroLukas recently pointed out, we’re probably near peak supply chain hysterics. And normalization on that front will help slow the rise in CPI.

6. In the meantime, the value factor should continue to outperform.

7. I’m watching cyclical vs. defensives here. New relative highs would be a bullish tell for the broader market.

8. FANG stocks have been trading at their lowest premium to the broader market since the 2018 bear market low (chart via BBG). Alphabet (GOOGL), Microsoft (MSFT), and Apple (AAPL) have seen nice pullbacks and reversals at their weekly Bollinger Band midlines.

9. The cryptocurrency charts look solid and are acting as a lead for the broader market. Bitcoin (BITCOMP) open interest has finally been perking up after trending down for the last year. This is indicative of big money interest returning to Bitcoin, which bodes well for the sustainability of this bull move.

10. Semi breadth keeps deteriorating, which typically leads to broader risk-off in the market. Let’s see if SOX can hold its 200-dma. As I said, lots of mixed signals out there.

11. The Canadian dollar is embarking on another leg up, with some help from higher oil prices. Rate spreads, spread momentum, and positioning are bullish tailwinds for CAD.

12. USD/CAD (inverse shown below) is technically constructive on both longer and lower timeframes. CAD/JPY is another one to watch for an entry on a pullback.