Following futures positions of non-commercials are as of July 29, 2025.

10-year note: Currently net short 896.6k, up 147.1k.

Governors Christopher Waller and Michelle Bowman did something that has not happened since 1993. They dissented in this week’s FOMC meeting. In a nine-to-two vote, the policy-setting body kept the fed funds rate steady at a range of 425 basis points to 450 basis points. The dissenting votes, of course, wanted to lower the benchmark rates, arguing that the labor market could start weakening soon even as inflation remains under control.

In a rather strange twist of fate, Waller and Bowman were vindicated Friday as it turns out the economy only created 73,000 non-farm jobs in July; more worryingly, June’s prior 147,000 was revised lower to merely 14,000 and May’s 144,000 was cut down to 19,000. The three-month average is now a paltry 35,000. The head of Bureau of Labor Statistics that produced the report was fired by President Donald Trump.

In the futures market, a 25-basis-point cut in September is now firmly priced in, followed by another in October, with December just about a toss-up. It is too soon to conclude but the tariff uncertainty may have had a role in the abrupt slowdown in job creation. If tariffs are changing every few weeks, it is hard for companies to properly plan their investment – both human and capital.

Oddly enough, some people are raising the possibility that the Federal Reserve should make a move intra-meeting – that is, before the September (16-17) meeting. That is not going to happen, with the unemployment rate at 4.2 percent, which inched up a tad in July. That said, a September cut is firmly on the table.

In the meantime, Bowman and Waller deserve kudos for speaking their mind and going against the majority, provided their dissents are driven by data, not politics. This should in fact be viewed as healthy. There are 12 voting members, and to always have unanimity just does not make sense. If this is the beginning of a trend, then the next chair will have an interesting time ahead. Trump wants lower rates, even saying they should be at one percent. There are two possibilities regarding this. One, the next chair may acquiesce to his demands to some extent, but not to a level Trump wants. Two, Chair Jerome Powell’s successor will be in a hurry for bigger cuts, but there will be enough dissents to deny him/her that.  

30-year bond: Currently net short 110.8k, up 27.9k.

Major US economic releases for next week are as follows.

Durable goods orders (June, revised) are scheduled for Monday. June orders for non-defense capital goods ex-aircraft – proxy for business capex plans – shrank 0.7 percent from May’s 29-month high to a seasonally adjusted annual rate of $75.6 billion. The series peaked at $78.1 billion in August 2022.

The ISM services index (July) will be out Tuesday. Non-manufacturing activity in June rose nine-tenths of a percentage point month-over-month to 50.8 percent – a two-month high.

Thursday brings labor productivity (2Q25). In the March quarter, non-farm output per hour increased 1.3 percent from a year ago. This was the lowest growth rate in two years.

WTI crude oil: Currently net long 133.4k, down 4.1k.

After closing last week right at crucial horizontal support at $65-$66, oil bulls got into action right from the word go this week. By Wednesday, West Texas Intermediate crude tagged $70.51 intraday, although most of the gains of the first three sessions was given back in the last two. As a result, a shooting star showed up on the weekly. For the week, nonetheless, the crude rallied 3.2 percent to $67.26/barrel.

Within a span of four sessions, the 200-day moving average ($68.01) was reclaimed and lost again, with the 50-day at $66.38. The daily probably wants to go lower in the sessions ahead. In April, WTI went from $72.28 on the 2^nd to $56.06 on the 9^th, with $65-$66 falling prey to a gap-down. This is a must-hold for oil bulls.

In the meantime, US crude production in the week to July 25^th increased 41,000 barrels per day week-over-week to 13.314 million b/d; output has come under slight pressure since registering a record 13.631 mb/d in the week to December 6^th last year. Crude imports grew as well, up 160,000 b/d to 6.1 mb/d. As did stocks of crude and distillates, which respectively rose 7.7 million barrels and 3.6 million barrels to 426.7 million barrels and 113.5 million barrels. Gasoline inventory, however, dropped 2.7 million barrels to 228.4 million barrels. Refinery utilization declined one-tenth of a percentage point to 95.4 percent.

E-mini S&P 500: Currently net short 163.2k, down 5.3k.

Equity bears finally saw some opening. The S&P 500 went from the April 7^th low of 4835 to Thursday’s intraday high of 6427, but the session ended up reversing hard, forming a bearish engulfing candle; this was followed by Friday’s gap-down. The large cap index declined 2.4 percent for the week to 6238 – a first down week in three and second in six.

There is room for the index to continue lower. Friday’s low of 6213 kind of tested horizontal support at 6200. Odds favor this gives way in the sessions ahead. In late June, the S&P 500 broke out of 6100s; a genuine retest is yet to occur. This is a make-or-break for the bulls. The 50-day at 6130 lies right there. A decisive breach of this support will open the door to a test of the 200-day (5901), which the index has closed above for nearly three months.

Euro: Currently net long 123.4k, down 2.2k.

The euro had a wild week, dropping for the first four sessions and snapping back strong on Friday as the greenback reacted poorly to a dismal jobs report for July. The euro still finished the week lower 1.3 percent to $1.1588, with a high of $1.1771 and a low of $1.1392. This week’s high makes up a series of lower highs since ticking $1.183 on 1 July. Early this year, the euro bottomed around $1.02s.

A decisive breach of $1.16 should open the door toward $1.12, which the currency broke out of in April and where it had faced decent resistance last August and September. If not for Friday’s 1.5 percent rally, $1.16 would have been compromised. Now that the bulls have managed to save this for now, they have an opportunity here to recapture the 50-day at $1.158 and rally the currency toward $1.175, wherein lies the trendline resistance from July’s high.

Gold: Currently net long 223.6k, down 29.4k.

On 23 July, gold ticked $3,439 intraday to find resistance at a falling trendline from 22 April when a fresh all-time high of $3,500 was posted. By this Wednesday, it was down to $3,268, before rallying – particularly Friday – to end the week up 0.8 percent to $3,363/ounce.

Since the April peak, the metal has essentially gone sideways, with $3,200 repeatedly finding buyers.

As things stand, the daily has room to head higher. The trendline in question gets tested at $3,430.

Nasdaq (mini): Currently net long 35k, up 4.2k.

Of four of the Magnificent Seven stocks reporting their June quarter this week, Microsoft (MSFT) and Facebook parent Meta (META) gapped up Wednesday, even though they closed substantially off their session highs; the other two were Apple (AAPL) and Amazon (AMZN), and they both closed lower post-earnings.

These stocks had come a long way from early April, and there was always a risk of ‘buy the rumor, sell the news’ phenomenon kicking in. The Nasdaq 100 bottomed at 16542 on 7 April and ticked 23589 intraday Thursday before reversing lower. By the end of the week, the tech-heavy index was down 2.2 percent for the week to 22763.

Given how overbought the index is, it can go a lot lower in the right circumstances. For now, nearest support at 22900s was breached this week. Six weeks ago, the Nasdaq 100 broke out of 22100s, and this is the one to watch. Just above this support lies the 50-day at 22307.

Russell 2000 mini-index: Currently net short 80.9k, up 8.7k.

Small-cap bulls faced rejection at 2300 for several weeks before they threw up their hands this week. On 23 July, the Russell 2000 rallied as high as 2283. Earlier, on 9 April, it put in an intraday low of 1733. Despite this rally, the index remains way below last November’s intraday high of 2466, which barely edged past the prior high of 2459 from November 2021.

This week, the Russell 2000 tumbled 4.2 percent to 2167. Small-cap companies by nature have a larger exposure to the domestic economy than their large-cap peers which also have overseas exposure. It is hard to get bulled up small-caps when the US economy seems to be struggling to create new jobs.

Leading up to this week, the index was clinging on to trendline support from the April low; this has now been breached. This raises the odds that a test of 2100 lies ahead.

US Dollar Index: Currently net short 4.2k, up 705.

The US dollar index maintained its upward momentum, up 1.1 percent this week to 98.69, although dollar bulls were not quite able to hold on to Friday’s intraday high of 100.26. This was the third up week in four following a dragonfly doji week bottom (96.38) on 1 July.

Around 97 lies crucial trendline support going back to the lows of April and May of 2011. Thus far, this has been defended. Bulls would have secured a major victory if they succeeded in keeping Friday’s early gains. The significance of 100-101 goes back some four decades. Retaking this level will be a major development for the bulls, but the bears are also not going to give it up easy.

VIX: Currently net short 67.1k, up 16.5k.

In January and February this year, VIX traded in 14.50s-14.70s for several sessions before turning up. Last Thursday and Friday, the volatility index traded in 14.90s; this Tuesday and Thursday, it again kissed 14.70s, and it held. Come Friday, VIX shot past both the 50- and 200-day (17.67 and 19.46 respectively). For the week, it jumped 5.45 points to 20.38; the only consolation for volatility bears is that the index backed off Friday’s intraday high of 21.90.

On the weekly, there is plenty of room for VIX to continue higher.

Thanks for reading!

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