To The Moon

Markets saw extreme volatility last week. Rumors of AI policy changes sent U.S. stocks plunging the day after Democrats swept the midterms. This dragged most assets lower in tandem. We took profits on our Nasdaq shorts and shorted the euro near its highs. The priority now is understanding what will drive the next phase of trading.

$纳指100ETF(QQQ)$ $纳斯达克(.IXIC)$ $NQ100指数主连 2612(NQmain)$ $微型NQ100指数主连 2612(MNQmain)$ $标普500(.SPX)$ $标普500ETF(SPY)$ $SP500指数主连 2612(ESmain)$ $微型SP500指数主连 2612(MESmain)$

Republicans have lost both the House and the Senate, leaving Trump fighting for his political survival. If he settles for inaction or token moves, he risks a future reckoning and a poor presidential legacy. This makes high-stakes gambles to regain ground more plausible. At a minimum, he may try to muddy the waters. Redirecting domestic tensions abroad is a familiar political tactic.

$道琼斯(.DJI)$ $道琼斯指数主连 2612(YMmain)$ $微型道琼斯指数主连 2612(MYMmain)$

Since early this year, we have emphasized the fourth quarter because of uncertainty around the midterms. With the result now clear, attention shifts to another recurring risk: the Middle East. Over the weekend, Israel’s president formally tasked Eisenkot with forming a new government. Trump faces pressure on multiple fronts, while Netanyahu is approaching the end of his tenure. Further disruption from either would hardly be surprising.

$标普500波动率指数(VIX)$ $1.5倍做多短期期货恐慌指数ETF-Proshares(UVXY)$ $A50指数主连 2611(CNmain)$ $恒生指数(HSI)$ $恒生指数主连 2611(HSImain)$ $恒生科技指数(HSTECH)$ $恒生科技指数主连 2611(HTImain)$

If this scenario plays out, risk appetite could deteriorate further. Treasuries have again shown signs of safe-haven demand, with yields steadily declining. The economic need to support Treasuries could therefore make geopolitical tensions a useful tool. Serving both economic and political goals may become a defining theme next year.

$20+年以上美国国债ETF-iShares(TLT)$ $美国10年期国债收益率(US10Y.BOND)$

Major risk assets may stage temporary rebounds. However, the midterm outcome has largely set their medium- and long-term trends and price structure. Safe-haven assets such as gold may be the exception. Silver temporarily pulled gold off course, but a reversal remains possible once gold finds a bottom.

$黄金主连 2612(GCmain)$ $微黄金主连 2612(MGCmain)$ $1盎司黄金主连 2612(1OZmain)$ $黄金ETF-SPDR(GLD)$ $白银ETF-iShares(SLV)$ $白银主连 2612(SImain)$ $迷你白银主连 2612(QImain)$

Oil prices may offer a clue to when this potential storm will pass. Past episodes suggest Middle East turmoil and stock market weakness can push oil higher. However, very high prices fuel recession fears, making those levels difficult to sustain. A plunge from near record highs could therefore signal that the turmoil and its market impact are fading.

$美国原油ETF(USO)$ $WTI原油主连 2612(CLmain)$ $小原油主连 2612(QMmain)$

Selling rallies in risk assets is therefore our preferred approach from here. Assets already leading the decline are likely to remain weak. Those that have held up better could face selling in turn. The dollar and Treasuries should benefit indirectly. Oil has fallen sharply, but the underlying case for support remains intact. At attractive prices, we remain willing buyers.

We took profits on half our Nasdaq short position at 27,250, after entering at 30,100. We still favor the short side. Current prices are far from our preferred entry levels, so we have no new orders pending. We will wait for a clear setup.

We shorted euro futures at 1.1290 last week, close to the week’s high. Additional sell orders remain at 1.1430 and 1.1490. The stop is set at 1.1580, with a target of 1.09. If the euro breaks to new lows, we will cancel the remaining sell orders.

$欧元主连 2612(EURmain)$ $欧元ETF-ProShares两倍做空(EUO)$ $欧元做多ETF-CurrencyShares(FXE)$

For gold, we are maintaining last week’s sell limit at 4,205. The stop remains at 4,330, with a target of 3,830.

For crude oil, we favor buying dips. Prices could form a double bottom near 86, but the signal still needs confirmation. We will watch for another week before deciding on entry orders.

P.S. Once the first target is hit, the stop automatically moves to the entry price. Any adjustments after a fill will be reported in subsequent articles.