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The S&P 500 fell by more than 80 bps today, driven by weak economic data this morning and growing geopolitical uncertainty. The rising wedge continues to unfold as expected, and just as today needed to be a down day, ideally tomorrow should be as well, marked by a clear break of support at 5,965. Momentum is showing signs of rolling over, with the index closing below the 10-day exponential moving average for the second time in three days—an early indication that the sell-off might be gaining traction, along with the RSI rolling over.

The HGX housing index had a rough day, falling nearly 2.5%, and now appears to be forming a potential double-top pattern. A clean break below the neckline at $610 would suggest the index could drop toward the April lows near $560. The RSI is confirming the bearish momentum as well.

Today, we saw the Treasury General Account (TGA) rise significantly due to tax receipts, increasing by $158 billion—from $288 billion on Friday to $446 billion.

SOFR rose today to 4.32%, up from 4.28% yesterday, and should continue trending higher into quarter-end. While it might not rise every day, the overall trajectory suggests a move back toward around 4.4% by the end of the quarter. Together, these factors imply that market liquidity will likely tighten further as reserve balances decline, overnight borrowing rates increase, and reverse repo activity likely accelerates.

Finally, the Fed meeting should be mostly uneventful, with the updated dot plot in the Summary of Economic Projections (SEP) providing insights into the direction of future policy. The real fireworks will likely come afterward, once the Fed announces it will hold rates steady, as President Trump is sure to quickly voice his view that Powell should have cut. At some point, Trump may name a new Fed chair—likely well before Powell’s term officially ends. It’s unclear how exactly that scenario would unfold, but it would certainly be intriguing: imagine the Fed holding rates steady in September, followed immediately by a tweet from the “shadow” Chairman stating they would have cut by 25 bps. The market reaction to such a scenario would undoubtedly be fascinating.

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