August CPI Preview: How Friday’s Inflation Print Could Move Stocks, Bonds, the Dollar and the Fed

Why This CPI Report Matters More Than Usual

August CPI is the last major inflation print before the Fed votes. The Bureau of Labour Statistics publishes the August Consumer Price Index on Friday 11 September at 8:30 am ET. The FOMC then meets 15–16 September, with the rate decision, new forecasts and the dot plot due at 2:00 pm ET on Wednesday 16 September. That sequencing is why this print matters more than a routine mid-cycle CPI. It is the last consumer-inflation snapshot the Committee will have before it has to choose between another hold at 3.50–3.75% and the first hike since 2023.

What the July Report Showed

July CPI rose 0.1% on the month and 3.4% year-on-year.

What Economists Expect for August

Consensus for August is a firmer headline — around 0.4% month-on-month — with the annual rate little changed at 3.3–3.4%. Core CPI, excluding food and energy, is expected around 0.2% month-on-month and 2.3–2.4% year-on-year. The monthly headline bounce is widely expected to come from energy after gasoline prices turned higher, plus some lift in airfares and lodging. The debate that will move markets is not whether headline inflation “looks hot” for one month. It is whether core, shelter and services confirm that underlying pressure is still fading — or whether it is starting to re-accelerate.

How Markets Are Positioned Ahead of the Data

Futures have been leaning toward a 25 basis-point hike next week, with probabilities recently around two-thirds after this week’s producer-price data and a firm August jobs report. Economists remain more cautious: a Reuters poll still had a majority looking for a hold, even as the share expecting at least one hike this year has risen. The Committee itself is split. The July vote was 9–3 to hold, with three members already wanting tighter policy. Chair Kevin Warsh will also publish a new Summary of Economic Projections. The dots may matter as much as the decision.

What Traders Will Watch Beyond the Headline

Markets will not treat “in line” as a non-event. They will parse the composition: core goods versus core services, rents and owners’ equivalent rent, airfares, insurance, used cars, and anything that feeds the Fed’s preferred PCE gauge later this month. A 0.2% core print driven by shelter cooling is a different story from a 0.2% print driven by broadening services. Rounding will matter too. A core reading that prints 0.3% after rounding is far more likely to force a hawkish repricing than a 0.15–0.24% range that still looks like 0.2%.

Scenario 1: CPI Prints In Line With Forecasts

This is the base case most desks are writing to: headline up about 0.4% on energy, core around 0.2%, annual headline still near 3.4%, core easing a tenth or so toward the mid-2s.

Equities

Equities would probably see an initial relief bid if core does not surprise higher, especially in rate-sensitive growth and small caps that have been hostage to hike odds. That bounce may not last the day. An in-line print does not remove a September hike; it merely keeps the existing 60–70% probability live. Banks and energy could hold up better than long-duration tech if the market concludes the Fed still has room to lean against inflation without an emergency move.

Bonds

Bonds would likely rally modestly if core lands at 0.2% after the pre-CPI sell-off, particularly if shelter and supercore look contained. Front-end yields are the most sensitive because they embed the September decision. A 4–8 basis-point dip in two- and ten-year yields is a reasonable base-case reaction if there is no ugly detail in services.

US Dollar

The dollar should be mixed to slightly softer on an in-line core, especially against currencies that sold off on this week’s ECB hike and oil spike. Confirming, not exploding, inflation takes some of the urgency out of the dollar bid — unless the details look worse than the headline.

How the Fed May React Next Week

An in-line report leaves the Committee on a knife-edge. A hold is still on the table if officials want more evidence that energy is a one-off. A hike is also on the table if they treat the strong labour market plus sticky services as enough to start the insurance tightening some members already wanted in July. The cleanest in-line outcome is a 25bp hike with a statement that this is not the start of a long campaign — or a hold with dots that still show a hike later in 2026.

Scenario 2: A Hotter-Than-Expected CPI Print

Think core 0.3% month-on-month, headline clearly above 0.4%, or services and shelter re-accelerating even if the rounded core still looks “only” 0.2%.

Equities

Equities would be the first casualty. Higher discount rates hit long-duration growth hardest. A risk-off tape would likely rotate toward defensives, energy and quality balance sheets. Financials can be two-sided: higher rates help net interest margins, but a sharper growth scare and a stronger dollar would cap the bid.

Bonds

Bonds would sell. The front end would reprice the September hike as near-certain and lift the terminal rate. Ten-year yields would rise if inflation expectations stop falling. A hot print after a firm jobs report is the classic “no landing yet” combination: weaker duration, higher real yields, and less room for the Fed to look through energy.

US Dollar

The dollar would catch a clear bid. Rate differentials would widen, just as oil-related inflation fears already support the US relative to Europe and Asia. That dollar strength would feed back into equities via tighter financial conditions.

How the Fed May React Next Week

A 0.3% core makes a skip much harder to defend. The base case in that world is a 25bp hike to 3.75–4.00%, a higher median dot for end-2026, and a press conference that stresses price stability first. A 50bp move remains a tail risk, not the central case.

Scenario 3: A Softer-Than-Expected CPI Print

A 0.1% core, a downside miss on services, or clear cooling in shelter would be the surprise that most helps risk assets.

Equities

Equities should rally, led by duration-sensitive growth, housing-related names and the broader “Fed can wait” complex. Breadth would matter: a genuine disinflation print is more useful to the whole market than a one-off goods number that looks like used-car or tariff noise.

Bonds

Bonds would be the cleanest winners. Front-end yields would fall as September hike odds drop from around two-thirds toward a coin-flip or below. The curve could bull-steepen if the market also fades the chance of a late-2026 hike.

US Dollar

The dollar should soften, particularly if lower US yields coincide with still-firm oil and an ECB that has already hiked. A weaker dollar would support gold, international equities and some commodity FX.

How the Fed May React Next Week

The Fed would almost certainly hold at 3.50–3.75%. Officials could still keep a hike in the dots as insurance if they distrust one soft month. The risk in a soft print is not an immediate cut. It is a “hawkish hold”: unchanged rates, still-restrictive language, and a chair who refuses to declare inflation finished.

What the Fed Is Actually Weighing

This is not 2022. Policy is already well below the 2023 peak, inflation is no longer 5–9%, and the Committee has spent most of 2026 on hold. The live question is whether a new energy shock and a still-solid labour market require an insurance hike before inflation expectations drift. PCE at the end of September will be the better gauge of what the Fed targets, but CPI is what they get before they vote. That is why composition beats the headline.

What to Watch After the Number Hits

Into Wednesday, watch three things after the print:

1. Whether September hike odds move toward 80%+ or back toward 50%.
2. Whether the two-year yield and the dollar confirm that shift.
3. Whether equity leadership stays with quality and energy or rotates back into duration.

The data will not end the argument. It will decide how much of next week’s meeting is already done before the Committee sits down. This is a framework for how the tape usually behaves around a high-stakes CPI, not a prediction of Friday’s number and not investment advice.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

Palantir and Nebius: a sovereign AI stack, not a merger of equals

The September 8 announcement that Palantir has named Nebius its preferred sovereign AI infrastructure partner is one of those deals that looks modest on a press-release page and large once you follow the logic. It is not an exclusive lock-in, it is not a co-sale of the two businesses, and it does not by itself crown anyone “the” market leader. What it does is pair Palantir’s software layer with a purpose-built GPU cloud inside Palantir’s own security perimeter — and that combination matters for how enterprises will buy AI over the next few years.

The deal is fresh. Palantir (PLTR) and Nebius Group (NBIS) said they will integrate Nebius compute and inference endpoints inside the Palantir enterprise perimeter after an integration period. Eligible commercial customers will then be able to run and continually adapt open models on Nebius infrastructure without pushing proprietary data and model weights out into a generic public cloud. The two firms will also try to bring capacity online faster, including modular data centres at sites that already have power.

Alex Karp put the thesis in one line: Nebius’s infrastructure lets customers run their own models under conditions they control; Palantir’s ontology and that infrastructure together “undergird the sovereignty our partners are demanding.” Arkady Volozh’s counterpart line was that organisations need both large-scale performance and control of data and models. That is the whole product.

Two different companies that suddenly need each other

Palantir is not a cloud company. It sells Foundry, Gotham, Apollo and, above all, AIP — the Artificial Intelligence Platform — plus the Ontology that maps an organisation’s objects, decisions and workflows so models can act on real operations rather than on a chat window. Its pitch in 2025–26 has been “sovereign AI”: AI that serves the institution instead of training a third-party frontier model on that institution’s data. US commercial revenue has been the proof point. In the second quarter of 2026, Palantir reported overall revenue of about $1.94 billion, up more than 90 per cent year on year, with US commercial revenue up 149 per cent to $764 million. Full-year guidance was lifted toward the $8.15 billion range, with US commercial expected above $3.42 billion. Those workloads have to run somewhere. Karp has spent the year arguing that token-based services quietly transfer enterprise IP. A preferred infrastructure partner that can sit inside the Palantir perimeter is the missing physical layer.

Nebius is the other half of that sentence, and its origin story is unusual even by AI-boom standards. The Nasdaq ticker NBIS is the renamed Dutch holding company that used to be Yandex N.V. After Russia’s invasion of Ukraine, trading was halted, Volozh was sanctioned and then unsanctioned, and in July 2024 the Russian consumer businesses were sold to a local consortium for roughly $5.4 billion. What remained — engineers, a Finnish data centre, cloud and AI infrastructure, plus stakes and subsidiaries such as Avride and TripleTen — became Nebius, an Amsterdam-headquartered “neocloud” selling GPU capacity as a service. Volozh returned as CEO. The company is not a 2023 garage startup; it inherited people who had already run large-scale search, maps, machine learning and cloud. That is why Palantir can claim Nebius was “built for AI from the ground up rather than adapted from general-purpose computing.”

The growth numbers explain why Palantir wanted that particular partner now. Nebius reported second-quarter 2026 revenue of $582.3 million, up 454 percent year on year, with the AI cloud segment growing even faster. Commentators cited an annualised run-rate around $3 billion, remaining performance obligations in the high tens of billions, customer commitments above $40 billion in some accounts, and a contracted-power target of 5 gigawatts. That is still smaller than CoreWeave’s backlog, but it is large enough to matter to Palantir’s commercial pipeline — and it is growing from a company that still has a European legal home and a narrative of control rather than hyperscaler lock-in.

Why this pairing, and why now?

The strategic logic is complementary, not overlapping. Palantir owns the authorisation, isolation, ontology and deployment layer. Customers already trust it with sensitive operational data. What they have lacked, in Palantir’s telling, is a sovereign option to train and serve their own open models on trusted metal without leaving that perimeter. Closed frontier models are expensive, general-purpose and, in Karp’s framing, extractive: you improve someone else’s model when you feed it your data. Open-weight models start weaker but can be looped on proprietary data until they beat the generic model on that domain. That only works if the compute is isolated, auditable and under the customer’s control. Putting Nebius endpoints inside Palantir’s perimeter is how you productise that claim for commercial accounts outside the US Army.

Nebius owns racks, power contracts, NVIDIA allocation and an AI-native software stack. Its problem has been distribution into the Fortune 500 and regulated industries that already standardised on someone else’s platform. Palantir’s forward-deployed engineers and commercial logo list are that distribution. A “preferred” badge from Palantir is also a credibility event for a firm that still has to live down the Yandex ancestry in some procurement rooms. The partnership is not described as exclusive. Palantir can still run on AWS, Azure, GCP, Oracle or on-prem. Nebius can still sell to everyone else. Preferred means first-call inside the sovereignty pitch, plus joint work on modular capacity where power already exists — a practical answer to the industry’s real bottleneck, which is no longer only GPUs but interconnects, transformers and megawatts.

The market’s first reaction was telling. Nebius shares jumped on the news; Palantir slipped. That is what you would expect if investors treat the announcement as a larger incremental demand signal for scarce AI compute than for a software vendor already priced as a winner. It does not mean the software side is unimportant. It means the scarce factor of production, for now, is still the factory.

What it does to everyone else in the stack

The relevant market is not “AI” as a blob. It is three layers that are colliding: hyperscale clouds, specialist neoclouds, and enterprise AI platforms. On the neocloud side, CoreWeave remains the scale leader by backlog and public profile, with contracted power measured in multiple gigawatts and a customer mix historically heavy on Microsoft and frontier labs. Lambda, Crusoe, Nscale and others compete on price, developer experience, energy strategy or geography. Nebius has been in that pack as a self-builder with European roots and a full-stack story. A Palantir preferred-partner designation does not make Nebius bigger than CoreWeave overnight. It does give Nebius a software channel the others don’t yet have at the same altitude. Expect copycat announcements: CoreWeave or Crusoe with a Databricks-, ServiceNow-, or Snowflake-shaped partner; European sovereign clouds courting the same Palantir customers; NVIDIA leaning harder on “sovereign AI” reference architectures that name more than one cloud. Validation of the neocloud category is real. Winner-take-all inside that category is not.

Hyperscalers should feel this more than they will admit in a blog post. AWS, Azure, Google Cloud and Oracle already host Palantir. They will keep doing so. The threat is narrative and procurement, not a sudden eviction. If a CIO can keep data, weights and fine-tunes inside a Palantir-controlled perimeter on Nebius metal, the default “just use our frontier model on our cloud” motion gets harder to defend in regulated industries, defence-adjacent commercial work, and any board that has started asking who actually owns the resulting model. Oracle has already played the sovereignty and dedicated-capacity card. Microsoft and Amazon will answer with more isolated regions, more confidential compute, and tighter AIP integrations. That is competition, not defeat.On the software side, Palantir’s peers — Databricks, Snowflake’s AI stack, C3.ai, Microsoft’s Fabric-plus-Copilot world, ServiceNow’s operational layer — are not made obsolete. They are being asked a sharper question: can you offer domain intelligence that the customer owns, or only rented intelligence that improves a platform vendor? Palantir’s bet is that ontology plus looped open models plus isolated compute is a different product from a lakehouse with a chatbot. The Nebius deal makes that bet cheaper to sell operationally. It does not prove the bet in production. Integration risk, capacity delivery and whether open models actually outperform closed ones after fine-tuning are still empirical questions.

Does this cement Palantir as the market leader?

Only if you define the market as Palantir already defines it. Palantir is the clear leader in a specific category: operational AI for complex institutions, with a government franchise that still funds the brand and a commercial engine that is now growing faster than the government book. No other listed software company has the same combination of classified-adjacent trust, forward-deployed implementation culture, and a working ontology that binds data to decisions. In that lane, this partnership strengthens the moat. It removes a practical objection — “where do we run our own models without leaking them?” — that hyperscalers were happy to leave unanswered. It does not make Palantir the leader of AI infrastructure. That title, such as it is, still sits with NVIDIA at the chip layer and with the hyperscalers plus CoreWeave at the capacity layer. It does not make Palantir the leader of foundation models. It does not freeze Databricks or Microsoft out of the enterprise. And “preferred partner” is a marketing and integration commitment, not a take-or-pay of Nebius’s entire 5 GW plan.

If Nebius misses build-out, or if Palantir’s commercial growth slows, the press release will look like a feature rather than a regime change. What it does cement is a direction of travel. The industry is splitting into two offers. One is rented intelligence: you send tokens to a closed model on a public cloud and accept that your data improves a shared brain. The other is owned intelligence: you take an open-weight model, loop it on your ontology-bound data, and keep the resulting advantage. Palantir has chosen the second offer and hired a factory to stand behind it. Nebius has chosen to be that factory for a software vendor that already has the accounts. Other players will have to pick a side or build a credible version of both. For investors watching both tickers, the clean reading is not “PLTR wins, everyone else loses.” It is that software and compute are bundling again, this time around sovereignty rather than around the original public cloud. Palantir looks more complete. Nebius looks more enterprise-grade. CoreWeave and the hyperscalers look like they need an answer that is more than another region and a confidentiality slide. That is a real shift in the market structure. It is not the end of the argument about who leads it.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

DXY Rejects 100 Again: What Friday’s NFP Means for the Dollar

The dollar’s problem is no longer a story about a single print or a single Fed speaker. It is a story about a ceiling. On the daily chart, 100 on the US Dollar Index has become the level the market keeps offering, but the USD keeps refusing. This week’s attempt failed again. DXY slipped through the mid-99s and printed as low as the high-98s, with the cash index last seen around 98.99 after a session that took almost six-tenths of a per cent off the greenback. The 52-week range still runs from 95.55 to 101.80, so this is not a collapse. It is a rejection. The price can stay under 100 for a long time. What it has not been able to do, repeatedly, is close above it. So will NFP prove to be the catalyst? NFP will not invent a new dollar regime on its own. It will decide whether the next test of 100 is a squeeze higher in yields or another fade into the 98s.

The technical fact that markets keep ignoring

Round numbers matter in FX because they organise options, systematic flows and the language of positioning. One hundred on DXY is not magic, but it is where several things coincide: a psychological handle, a zone that has capped the latest recoveries, and a cluster of medium-term averages sitting just underneath it. Recent technical maps show the index struggling below the 20-day middle of the band and the 100-day average, with the upper envelope of volatility still pointing to the low 100s as the level that would change the tape. RSI has not been screaming a crash; it has been describing a market that cannot sustain upside. That is a different, and more stubborn, problem.

A hold under 100 keeps the dollar in a range-trade identity: funding currency on quiet days, safe-haven on shock days, and a residual claim on US rate differentials the rest of the time. A clean daily close and follow-through above 100 would re-open the 101–102 area that defined the June high. Until that happens, every rally into the figure is a sale unless the bond market gives the dollar a reason to stay bid.

Friday’s NFP is the catalyst, not the thesis

The August Employment Situation report is due at 08:30 ET on Friday, 4 September. Consensus, as compiled for the Wall Street Journal survey, is modest rather than heroic: nonfarm payrolls +53,000 after July’s -23,000, an unemployment rate unchanged at 4.1%, and average hourly earnings +0.3% month-on-month / about +3.0% year-on-year. The range around the headline is wide. Some desks treat July as seasonal distortion and look for 65–80k. Others worry that any rebound is education and calendar noise. ADP already printed softer than hoped, which helped Thursday’s dollar dip. Claims have stayed contained. The labour market is neither collapsing nor booming. It is ambiguous — and ambiguity is exactly what a resistance test does not want.

The dollar reaction function is familiar, but the weights have shifted. A hot print — payrolls well above 80k, unemployment dipping, wages sticky — would reprice the front end first. Two-year yields would lead. September FOMC odds, which have already been wrestling with the possibility of a hike rather than a cut, would firm. DXY would get a fast bid back toward 99.50–100.00. That bid only becomes a break if the move in yields is accepted by the long end rather than fought by it. A consensus print — 40–70k, jobless rate 4.1%, wages as expected — leaves the dollar inside the same box. Traders will fade the first spike and wait for next week’s inflation data.

One hundred remains the cap. A weak print — another negative payrolls number, or unemployment jumping — is the path that takes 100 off the table for weeks. The dollar’s rate-support argument thins. The 2-year comes in. Risk assets can rally and so can gold. DXY would be looking at the mid-98s, then the lower band near the mid-to-high 98s, which already defined this week’s low. Wages will matter as much as the headline. Payrolls can be noisy. Average hourly earnings tell the Fed whether the labour market is still an inflation machine. A 0.4% month-on-month wage print with a firm headline is a dollar event. A 0.2% wage print with a soft headline is a bond rally first and a dollar story second.

The bond market is the dollar’s true counterpart

The dollar does not trade NFP in isolation. It trades the Treasury curve. By early this week, the 2-year was around 4.39%, the 10-year near 4.79%, and the 30-year around 5.27%. Those are not crisis yields. They are yields that say the market is no longer pricing a smooth glide back to the old post-2010 equilibrium. Thursday’s dollar softness arrived as yields eased from those highs, which is the cleanest short-term correlation in the book: lower real and nominal rates, softer dollar. The inverse is why 100 keeps appearing. Every time the front end prices a tighter Fed, DXY walks up to the figure. Every time the long end refuses to validate that tightening — because term premium is already doing the work — the dollar stalls.

That is the risk profile in one sentence. The dollar is long US exceptionalism and long the idea that America can issue whatever it needs at a price the world will pay. It is short duration convexity. When bonds sell off for growth or inflation reasons, the dollar usually likes it. When bonds sell off because there is simply too much paper, the dollar’s bid becomes conditional. Foreign buyers who must hedge dollar-denominated assets care about the cross-currency basis and whether 10-year and 30-year yields compensate them for fiscal risk. A higher term premium can support the dollar at the margin if it reflects stronger US activity. It can hurt the dollar if it reflects a buyers’ strike. Watch the 2s10s (the gap between the 2-year and 10-year Treasury yields: 10-year minus 2-year)and 10s30s (the gap between the 10-year and 30-year: 30-year minus 10-year) into the NFP print. A bull-steepener after weak jobs (front end rallies more than the long end) is classic dollar-negative.

A bear-steepener after strong jobs (the long end sells off more than the front end) is dangerous for risk assets and ambiguous for DXY: higher long yields can attract capital, but they also tighten financial conditions and eventually slow the very labour market the dollar is celebrating. Treasury supply sits underneath all of this. The calendar after Labour Day is not light. Coupon reopenings this month still have to be absorbed, and the official sector has already been experimenting with larger buybacks to smooth the market — with expanded operations flagged from 9 September. Buybacks can take duration out of the street. They cannot repeal the stock of debt. US outstanding Treasury debt has pushed through the $40 trillion mark. The composition of the bid has shifted toward price-sensitive holders — funds, households, relative-value accounts — and away from the old price-insensitive official bid. That is how term premium becomes structural rather than cyclical.

The sovereign supply avalanche is global

This is not only an American story, which is why the dollar’s “safe haven” reflex is less automatic than it was in 2011 or even 2020.OECD sovereigns borrowed a record amount in 2025 and are projected to raise around $18 trillion gross in 2026, with refinancing needs near $14 trillion and net borrowing close to $4 trillion. Outstanding OECD sovereign bond debt is already above $60 trillion. Japan is defending a 10-year yield that has been flirting with 3%. Europe still has to refinance pandemic-era stock at higher coupons. Emerging-market sovereigns compete for the same cross-over bid. When every large Treasury, Bund, Gilt and JGB calendar is heavy in the same quarter, the marginal dollar of real-money demand gets rationed by yield. That rationing is the “avalanche”: not a sudden default wave, but a persistent surplus of duration that has to clear at a price.

For the dollar, global supply cuts two ways. Flight-to-quality still favours Treasuries and therefore the currency when the shock is abroad. When the shock is the asset class itself — too many governments, too little genuine surplus savings — the dollar does not automatically win. It wins only if US assets remain the least-dirty shirt and if the Fed is not easing into the issuance. That is why 100 on DXY has become a referendum on whether US yields are a magnet or a warning.

Commodities: the other side of the dollar’s personality

The textbook inverse still operates. A softer DXY is an easing of the global unit of account. Gold likes it. Industrial metals like it if the dollar is falling because policy is easing rather than because growth is dying. Oil is messier: priced in dollars, driven by geopolitics and spare capacity, and capable of rising with the dollar when the shock is supply. The practical mapping into Friday is simple. Weak NFP, weaker dollar, firmer gold and a bid for metals that had been waiting for a break in real yields. Strong NFP, firmer dollar into 100, gold gives back the easy money until the long end speaks. Oil will take its cue from the growth impulse in the payrolls report and from whatever the Middle East tape is doing — not from DXY alone. Commodities feed back into the dollar through inflation expectations. A dollar decline that lifts oil and import prices just as wages refuse to cool is the loop that brings 100 back into play. A dollar decline that accompanies falling real yields and contained oil is the loop that keeps DXY heavy. Friday’s wage line is the hinge between those two loops.

Risk profile: what the dollar is, right now

Treat DXY as a hybrid, not a pure risk-off asset. It is still the funding currency of global carry. When volatility is low, and the Fed is on hold, dollar shorts finance longs elsewhere. That makes 100 a crowded place to be long: the last buyers are late, the options market is stocked with calls, and the first disappointing data print flushes the tape. It is still a policy-divergence currency. If Friday forces the Fed toward tightness while Europe and Japan are constrained by their own fiscal-bond arithmetic, the dollar can win even if US fiscal news is ugly. Divergence is the cleanest bullish case left under 100. It is no longer an unchallenged fiscal sanctuary. The market has learned to separate “nobody else has a market this deep” from “nobody else has a deficit this large.” Depth keeps the dollar bid in a panic. Depth does not prevent a slow bleed when issuance is the story of the year. Positioning into NFP should respect that hybrid. Chasing a pre-data squeeze into 99.80 is paying up for a level that has already failed. Selling every bounce toward 99.50 without a plan under 98.70 is ignoring the fact that a hot wage print can still squeeze the index 80 points in an hour. The professional expression is optionality: own the wings around the figure, or wait for the first 15-minute range after 08:30 to break and then join it.

What would actually change the chart?

Three things, in order.

1. First, NFP and wages that force the 2-year through its recent highs and keep it there into next week’s inflation data. That is how 100 gets a second, more serious test.
2. Second, a Treasury auction sequence that tails off, with weak indirects, just as the Fed is being priced tighter. That is how the dollar rally dies at the figure: rates up for the wrong reason.
3. Third, a genuine global duration strike — JGBs, gilts and Treasuries selling together — that overwhelms the usual dollar bid. That is the avalanche scenario. It does not need a crisis headline. It needs one more quarter of $18 trillion in OECD paper to meet a smaller official bid. Until one of those three arrives, the daily chart’s verdict stands. One hundred is the nemesis. 98.99 is the market saying so. Friday will not retire that level. It will only tell you whether the next visit is a break or another refusal.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

The News That Sent Moderna Soaring

The daily chart of Moderna on 19 August 2026 is one of those rare candles that every volume price analysis trader should study closely. It is a textbook example of what happens when genuine news collides with extreme volatility, massive volume, and a crowd of traders who pile in late, expecting the move to continue. On that Wednesday, Moderna and Merck announced that their personalised mRNA cancer vaccine, used in combination with Keytruda, had met both its primary and secondary endpoints in a large Phase 3 melanoma trial. The vaccine reduced the risk of the cancer returning and spreading after surgery. It was the first successful late-stage result for an mRNA-based cancer therapy. The market reacted instantly. Moderna shares exploded, with reports of gains between 150% and 177% on the day — the stock’s best session on record. Billions were added to its market value in hours. Trading volume was extraordinary, running many times the recent average as buyers rushed in.

The Daily Candle and the Volume Story – Moderna

Look at the daily candle itself. It is a wide-range, high-volume explosion to the upside. The close is near the highs, exactly as you would expect after such dramatic news. Volume confirms everything. It is what we call the ‘master candle’. The volume on that candle was enormous. In terms of volume-price analysis, this is conviction. The market was not drifting higher on thin trading; it was being driven by genuine institutional and retail participation reacting to a fundamental breakthrough. High volume on a wide-range candle after major news is the classic signature of a move that has substance — at least in the short term.

The Quantum Dynamic Volatility Indicator Fired in Real Time – Daily Chart Moderna

And sitting on that candle is the Quantum Dynamic Volatility indicator, with its distinctive purple arrows above and below. That is the signal we have been waiting to highlight. This is not an ordinary wide-range bar. The Dynamic Volatility indicator is built around Average True Range. It constantly scans price action and fires when a candle moves outside the normal range for that market and timeframe. Crucially, it does this in real time — before the candle has even closed. On 19 August, you would have seen those purple arrows appear while the session was still unfolding, giving you an immediate warning that this was extreme, high-risk price action. That is a massive advantage. Most traders only recognise volatility after the close, by which point it is already too late to decide whether to participate or stay out.

What Comes Next: Congestion or Reversal In Moderna?

But here is the classic next chapter that every experienced trader recognises. After a volatility signal of this magnitude, one of two things almost always follows: a period of congestion as the market digests the move, or a full reversal as the late buyers who chased the highs get trapped and shaken out. Imagine the number of traders who bought into the upper half of that candle, convinced the news would keep driving the stock higher the next day. They are now sitting on the highs with the volatility indicator flashing its warning. Many of them will be forced to exit if price starts to pull back into the body of the candle or below it.

Why This Indicator Matters in Every Market and Timeframe

This is precisely why the Quantum Dynamic Volatility indicator matters so much, and why it works in every market and every timeframe — stocks, forex, futures, crypto. Extreme volatility candles are the market’s favourite way of trapping traders. A sudden news-driven spike sucks in the crowd. The candle closes strong. Then the market reverses or chops, leaving those late longs (or shorts) in weak positions. The indicator does not predict the news. It simply tells you, in real time, when price has become statistically extreme. That knowledge alone changes how you trade the session. You can stand aside, wait for validation on subsequent candles, or look for the inevitable congestion or reversal that so often follows.

The 19th August Moderna candle is a perfect teaching example. The news was real and significant. The volume was massive and confirmatory. The volatility was extreme and signalled live, before the close. What happens next on the daily chart — whether price consolidates the gains or gives back a large portion of them — will tell us whether the trapped traders on the highs get squeezed or whether the move has enough follow-through to continue. This is volume price analysis in action. Price shows you the move. Volume tells you the conviction. The Dynamic Volatility indicator warns you when the move has become dangerous. Together they give you a far clearer picture than price alone ever could. And because the signal arrives while the candle is still forming, you have time to think rather than react. Keep watching the subsequent price action around that 19 August high. The lessons from this one candle will be relevant for a long time.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

Friday’s NFP Jobs Report Is the Warm-Up. Next Week’s FOMC Is the Main Event.

Markets have had three trading days to digest Kevin Warsh at Jackson Hole. They did not like the tone. Hike odds jumped. Treasury yields followed. Equities wobbled. Now the calendar tightens. Friday’s nonfarm payrolls (NFP) for August is the last big labour print before the Federal Open Market Committee meets on 15–16 September. That meeting comes with a Summary of Economic Projections and a press conference from a chair who has already told the room that inflation work is not done. Layer on two other facts. Monday is Labour Day in the US, so liquidity thins from Thursday afternoon. And September is the only month in which the S&P 500’s long-run average return is negative. That is the week. Jobs first. Policy second. Seasonality in the background.

The data that actually matters this week:

NFP prints at 08:30 ET on Friday 4 September. It is August’s report. Consensus from the Wall Street Journal survey is modest, not heroic:

• Nonfarm payrolls: about +53,000 after July’s –23,000
• Unemployment rate: 4.1%, unchanged
• Average hourly earnings: +0.3% month-on-month, about 3.0% year-on-year

The range around that headline is wide. Some desks are nearer 65–80k and treat July as noise. Others worry the rebound is just education and seasonal bounce. ADP on Wednesday (consensus +47k) and weekly claims on Thursday (205k) will set the mood before Friday.

Why this print carries extra weight:

• It is the last full employment report Warsh’s committee sees before 16 September.
• July already looked soft. A second weak number would argue the labour market is cooling faster than inflation.
• A hot number — especially with wages above 0.3% — would validate the Jackson Hole message and make a hike the base case, not a debate.
• Revisions matter as much as the headline. July was negative. If June and July are revised down again, the “rebound” story dies on arrival.

Watch three lines, not one: payrolls, the jobless rate, and wages. A 50k print with wages at 0.4% is not dovish. A 20k print with unemployment at 4.3% is not hawkish, whatever Warsh said in Wyoming.

How Warsh differs from what markets were used to

Jerome Powell’s last years were a long negotiation with inflation and a labour market that cooled in slow motion. Forward guidance was dense. The dots were theatre. Markets learned to fade the press conference and wait for the next CPI. Warsh is running a different play.

• Less “we will be data-dependent in both directions.” More “inflation has not meaningfully improved; we have work to do.”
• Less comfort with a quiet Fed that lets futures price the path. More willingness to let the market feel uncertainty.
• A July FOMC that held at 3.50–3.75% with three presidents already wanting a hike — then a Jackson Hole speech that sounded tighter than that hold.

That gap is why the tape felt spooked. The July statement said pause. The Friday speech said the job is unfinished. Bond desks do not like chairs who sound like two different committees a month apart. The practical difference for this week: Powell-era traders bought dips on soft payrolls. Warsh-era traders have to ask whether soft payrolls even stop a hike if core inflation is still miles from 2%. The chair has already said AI-led productivity may let the economy run hotter without blessing easier policy. That is not the 2024 playbook.

What FedWatch is saying right now

CME FedWatch turns fed-funds futures into a probability of the next move. It is not a poll of the Board. It is the price of insurance. As of Tuesday 1 September:

• A 25-basis-point hike on 16 September is the modal outcome, at around 66–68%.
• A week before Jackson Hole, those odds were under 40%.
• After the speech, they were mid-50s. They have kept grinding higher into this week.

Cuts are not on the September board. The debate is hike versus hold. By year-end, the futures strip still has a meaningful chance of a second move.

How to read that into Friday:

• A strong NFP and firm wages → hike odds toward 80% and the 2-year yield does the talking.
• A middling 50k with unchanged unemployment → odds stay in the 60s. The market waits for 11 September CPI.
• A second negative payrolls print or a jump in unemployment → odds can fall back toward a coin flip. That is the only path that takes September off “most likely hike.”

FedWatch will reprice in minutes on Friday. That repricing is the signal for the next ten sessions, not the headline itself.

September’s unlovely habit

The “September effect” is not folklore. It is a stubborn average.

• Since the late 1920s, the S&P 500’s average September return is about –1.2%. It is the only month with a negative long-run mean.
• Since 1950, the average is about –0.7%, with positive Septembers less than half the time. When the month falls, the average drop is close to –4%.
• Over the last decade, the pattern is the same story with different actors: mutual-fund window dressing into quarter-end, summer books being cleaned, and a mid-month FOMC that often arrives when positioning is already long.

Two caveats, because averages hide the year you are in. First, 2026 is a midterm year. Some of the best Septembers on record were midterms — 2010, 1998, 1954. The sample is small. Do not treat it as a buy signal. Treat it as a reminder that “worst month” is not “always down.”

Second, trend still matters. When the S&P sits above its 200-day average into September, history is less brutal than when it enters the month already broken. Seasonality is climate. The Warsh repricing is weather. For a portfolio, the honest use of the September cycle is this: expect chop, do not expect a script. Month-end selling in weak years is often worse than in the first week. NFP and FOMC sit in the first half. That is where the volatility budget gets spent.

Labour Day and a thin tape:

US markets close Monday, 7 September. Europe and Asia do not. That mismatch always leaks into Thursday and Friday.Typical pattern into this holiday:

• Risk books get lighter from Thursday lunchtime New York time.
• Spreads widen. Index futures overshoot headlines.
• NFP Friday before Labour Day is a classic trap: the first reaction is large, the follow-through on Tuesday is the real one.

If Friday’s print is a shock, do not assume the 10:00 ET futures move is the last word. The cash session after Labour Day, with FOMC eight sessions away, is when real money has to decide whether Warsh is bluffing.

How the week can break

1. Hot NFP (well above 80k, wages firm)
   Hike odds lurch toward fully priced. Two-year yields lead. Growth stocks give back duration. The dollar firms. That sets a hawkish glide path into 16 September unless CPI on the 11th collapses.
2. Consensus NFP (40–70k, unemployment 4.1%)
   The market stays in the Jackson Hole range. FedWatch holds in the 60s. Bonds do the work, not equities. Attention shifts to CPI.
3. Soft NFP (near zero or negative, unemployment up)
   Hike odds drop. The 2-year rallies. Equities bounce first, then ask whether Warsh still hikes on inflation alone. That is the scenario that turns next week into a genuine two-way FOMC, not a coronation.

In all three cases, the bond market remains the tell. HYG/IEF still saying credit is calm does not stop IEF from being sold if the 7–10 year has to reprice a 3.75–4.00% funds rate.

What to do with it:

This is not a week for heroics into a holiday.

• Size Friday risk as if the first print will be revised on Tuesday.
• Let the 2-year and FedWatch, not the headline payrolls number, decide whether the hike is “in.”
• Respect September’s average without selling the year because the calendar flipped.
• Remember the sequence: NFP 4 September → Labour Day 7 September → CPI 11 September → FOMC 16 September.

Warsh has already told you inflation is unfinished business. Friday tells you whether the labour market gives him cover to act — or forces him to explain a hike into a stalling jobs tape. That is the guide to next week. The dots and the press conference will do the rest.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

Why This Jackson Hole Speech Mattered

Warsh took office on 22 May 2026, replacing Jerome Powell. Friday 28 August marked his 100th day as chair and his first keynote at the Kansas City Fed’s annual symposium. The speech, titled In Our Time, mattered because:

• It was his most detailed public read of the economy since becoming chair.
• Markets had been confused after the July FOMC press conference.
• Long-term yields had already risen on doubts about Fed credibility.
• Investors wanted to know whether “no forward guidance” also meant “no action on inflation.”

Warsh’s answer: do not treat this as a policy forecast. Treat it as a standard. If inflation is not moving to 2% clearly and fast enough, “we have work to do.”

What Warsh Said — The Key Lines

Warsh opened with a hiking metaphor and then shut the door on the usual Fed script:

• “You can call it an outline. You can call it a trail map. Just don’t call it forward guidance.”
• He wants a “quieter Fed.”
• He remains sceptical of dot plots, detailed rate-path talk and mechanical reaction functions.
• He wants markets, not the Fed, to do more of the forecasting.

On inflation, the tone sharpened:

• Recent CPI and PCE readings were “better than expected.”
• They still “do not tell me that underlying trends have meaningfully improved.”
• 12-month PCE inflation is 3.7%.
• The six-month change is 4.1%.
• Inflation has been above target for 65 months.
• More than half of PCE components are still rising at an annual rate above 3%.
• “The Fed’s predominant focus right now should be on prices.”
• “We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do.”

On the economy:

• The labour market is stable, with unemployment around 4.1%.
• Business investment is strong, especially AI-related capex.
• Corporate profits remain robust.
• Credit and loan markets show “few signs of policy restraint.”
• The policy rate has sat in the 3.50–3.75% range since December.
• Wage growth, he said, has not been a reliable inflation signal “for a very long time.”

How This Differs From What He Said Before

This is the part markets seized on. Warsh did not suddenly become a different person. He did become clearer.

Before Jackson Hole, the pattern was:

• Repeated vows to deliver 2% inflation.
• “No soft target” language after the July meeting.
• A 9–3 vote to hold rates in July, with three dissenters wanting a hike.
• Little detail on what would actually trigger tighter policy.
• Earlier in the summer, comments that inflation risks had eased.
• A communication style that left the long end of the bond market uneasy.

At Jackson Hole, the shift was:

• Better summer inflation data were explicitly judged insufficient.
• Financial conditions were described as not restrictive enough.
• Price stability was put first, even with a resilient economy.
• The chair came closer than before to acknowledging that hikes may be needed if inflation stays sticky.

He still refused to pre-commit to September. But the burden of proof changed. Before the speech, markets asked what the economy would have to do to force the Fed to tighten. After the speech, the question is what the data must do to stop the Fed from tightening.

Bond Markets Took the Message First

Equities dithered. Bonds did not. Friday’s Treasury move:

• The 2-year yield jumped more than 11 basis points, to around 4.34–4.35%.
• That was one of the sharpest post-Jackson Hole short-end moves in years.
• The 10-year yield rose more modestly, to around 4.72%.
• The 30-year was mixed to slightly firmer, then steadied.
• The curve bear-flattened: short yields rose more than long yields.

What that flattening means:

• Near-term hike odds increased.
• Some longer-term inflation-credibility risk emerged from the long end.
• Investors became more willing to believe Warsh would act if needed.
• Duration risk did not disappear. Growth, AI capex and fiscal supply still support high real yields.

Rate-hike pricing:

• September hike odds rose from about 35–40% before the speech to the high 50s or around 60% by the weekend.
• Markets still need this week’s data to confirm the move.

How Stocks, the Dollar and Gold Reacted

The equity reaction was messy rather than panicked.

• The S&P 500 finished Friday down about 0.25%.
• The Nasdaq fell about 0.5%.
• The Dow was little changed.
• Rate-sensitive tech and small-caps lagged.
• Nvidia and other chips came under pressure after a strong prior session.
• The dollar firmed.
• Gold sold off as rate-hike bets rose.

Into Monday, futures pointed to a cautious open as investors weighed higher policy risk against still-solid growth and the AI capex boom. The 10-year yield was still around the mid-4.70s.

Why Bond Yields Are the Story Now

Warsh wants market signals to stay “as unfiltered as possible.” That puts Treasuries at the centre of the week. Watch four things in the bond market:

• The 2-year yield: the cleanest read on September hike odds.
• The 10-year yield: the mix of growth, inflation and term premium.
• The 2s10s curve: flattening if hike fears rise but long-run credibility improves.
• Real yields: still the bigger medium-term driver, especially if AI investment keeps demand for capital high.

If the Fed is truly less chatty, bond prices will do more of the talking than any chair press conference.

What Markets Will Watch This Week

The next FOMC meeting is 15–16 September. This week’s data will decide whether Friday’s repricing sticks

Key releases:

• Tuesday: ISM manufacturing and JOLTS job openings
• Wednesday: ADP private payrolls
• Thursday: jobless claims and ISM services
• Friday 4 September: August nonfarm payrolls, unemployment rate and average hourly earnings

How the data could land:

• Strong jobs + sticky wages = higher chance of a September hike, firmer short-end yields, pressure on growth stocks.
• Soft jobs + cooling pay = hike odds fade, short-end yields ease, some relief for duration and tech.
• Mixed data = more chop, because Warsh will not fill in the blanks.

He has said he cares about trends, not one print. That does not mean Friday’s payrolls are irrelevant. It means one weak number may not save the market from a hawkish bar — and one strong number may not lock in a hike on its own.

The Bigger Warsh Agenda Behind the Headlines

The inflation comments got the headlines. The institutional project is larger.

Warsh has set up task forces on:

• Communications
• Inflation frameworks
• Data quality and timeliness
• The balance sheet
• Productivity, jobs and AI

His broader principles are also becoming clearer:

• 2% PCE is a firm, fixed target.
• Interest rates are the main tool in normal times.
• Unconventional policy is for crises.
• Money and financial conditions still matter.
• The Fed should not overshare or over-commit.

Jackson Hole was therefore two speeches in one: a near-term inflation warning and a longer-term attempt to change how the Fed talks.

What This Means for Investors

For bond investors:

• The front end is now a data trade into mid-September.
• The long end still hinges on real yields, supply and whether inflation credibility holds.
• A credible path of tightening could eventually help the long end.
• A hold after this language would reopen the credibility debate that pushed long yields higher earlier this summer.

For equity investors:

• Higher short-rate odds are a headwind for long-duration growth and high-beta tech.
• The AI capex story has not been cancelled.
• The discount-rate debate is back.
• Volatility around labour and inflation prints is likely to stay elevated.

For the dollar and commodities:

• A more hawkish Warsh supports the dollar if the odds of a hike keep rising.
• Gold is more vulnerable when real yields and policy odds firm.
• Oil remains a separate geopolitical risk, not a Fed story.

The Bottom Line

Warsh did not publish a rate path. He did raise the bar. Better-than-expected inflation data are no longer enough. Financial conditions, in his view, are not doing enough work. Price stability comes first. That is why bonds moved first and why they still matter most this week. In a quieter Fed, yields are the signal. Payrolls on Friday will test whether markets believe the new chair meant what he said at Jackson Hole — or whether another hold would turn this speech into just another tough paragraph.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

Palantir: From Congestion Breakout to the All-Time High?

Background, the business, the Q2 reset — and why today’s close at $185.93 matters for a stock we hold and have traded multiple times on the way up.

Palantir has always divided a room. Some still see a shadowy government contractor. Others see one of the few software businesses that has turned the AI boom into accelerating revenue, fat margins and hard cash. For readers of this site, it is also a name we know well: we hold it, and we have traded it many times, from the double digits to the triple digits, on the way up. That is why today’s tape matters. Palantir closed at $185.93 after breaking out of congestion on the daily chart on good volume, and was last seen around $184.90 in the post-market. The all-time high of $207.52, set on 3 November 2025, is no longer a distant memory. It is about 11–12% away. The question is whether the business, the earnings reset and the technicals now give that high a realistic chance of being taken out in due course.

From seeing-stones to software for the West

Palantir Technologies was founded in 2003 by Peter Thiel, Alex Karp, Joe Lonsdale, Stephen Cohen and Nathan Gettings. The name comes from Tolkien’s palantíri — the seeing-stones that reveal what is happening across a vast and messy world. That is still a useful way to think about the company.

The founders’ starting point was post-9/11 intelligence work: how do you find patterns across fragmented databases without building a single, lawless surveillance warehouse? Early backing from In-Q-Tel, the CIA’s venture arm, helped Palantir into the US intelligence and defence world. Karp has been chief executive since the early years and remains the public face of the firm: combative on stage and unapologetic about serving Western institutions.

Key milestones:

• 2020 — Direct listing (not a conventional IPO); HQ moved from Silicon Valley to Denver
• 2023 — Launch of the Artificial Intelligence Platform (AIP)
• 2024 — Added to the S&P 500
• 2025–26 — Commercial AI demand, not just government work, becomes the growth engine

For years the stock was treated as a cult name: loved by a dedicated retail base, distrusted by parts of the institutional world, and often described as if it were a data broker. That caricature never quite fitted. Palantir does not hoover up the world’s personal data and resell it. It sits atop a customer’s existing systems, connects them, and turns that mess into something operators can actually use.

What Palantir actually sells

The product set is simpler than the mythology.

• Gotham — The original government and intelligence platform. Built for defence, law enforcement and national security customers who need to fuse signals, reports, logistics and operational data, then act on it. This is the Palantir that shows up in debates about ICE, the Pentagon and allied militaries. Karp has never pretended the work is abstract.
• Foundry — The commercial counterpart. Manufacturers, energy companies, hospitals, retailers and banks use it to integrate supply-chain, production, inventory and financial data without ripping out the underlying systems.
• Ontology — The model of the enterprise’s objects and relationships; the map the rest of the software runs on.
• Apollo — Deploys and updates software across classified, on-premise and cloud environments.
• AIP — Lets customers put large language models and agents to work against their own data rather than handing that data to a frontier lab.

That last point has become the commercial argument of 2025–26. Karp calls it AI sovereignty: companies want the productivity of models without making their operations the training set for somebody else’s next model. Palantir claims to be one of the few firms that can turn tokens into operational value within a factory, hospital, or government agency. The customer mix still matters. The United States is the engine. In the latest quarter, US revenue was 81% of the group. The commercial side, once the junior partner to government work, is now the growth story. That shift is what the market is paying for.

The Q2 report that reset the tape

Palantir reported second-quarter 2026 results after the close on 3 August. This was not a mild beat. It was the sort of print a richly valued stock needs if it is going to keep climbing.

The numbers that matter:

• Revenue: $1.935 billion, up 93% year on year (consensus near $1.81 billion)
• US revenue: $1.573 billion, up 115%
• US commercial revenue: $764 million, up 149%
• US government revenue: $809 million, up about 90%
• Adjusted operating margin: 62%
• GAAP operating income: $912 million (47% margin)
• GAAP net income: $1.062 billion (55% margin)
• Adjusted free cash flow: $1.22 billion
• Rule of 40: 155%
• Net dollar retention: 157%
• Remaining performance obligations: about $4.9 billion, up 103% year on year
• US commercial TCV: $2.13 billion, up 153%
• Deals of $1 million+: 220

Karp’s line captured the profitability shift: the company made more profit in one quarter than it generated in revenue in the same quarter a year earlier.

What they said about the future

Guidance was raised hard:

• Q3 revenue: $2.160–$2.164 billion
• FY 2026 revenue: $8.150–$8.158 billion (about 82% growth)
• US commercial revenue: more than $3.424 billion (at least 134% growth)
• Adjusted operating income: about $4.89 billion
• Adjusted free cash flow: $4.5–$4.7 billion
• GAAP operating income and net income still expected in every quarter of 2026

Karp said demand for AI sovereignty had been “unleashed,” called the quarter “otherworldly,” and told CNBC the growth “looks like this is going to go on for at least another 18 months.” Management also described the US commercial business as “on fire” — and still “nascent.”

How the market reacted

• After-hours jump of roughly 15% on the print
• Then a ~29% rip on 4 August, from a close of $125.65 on earnings day to $162.66 the following session

That was the moment the “AI trade is fading” narrative ran into a company that was still accelerating on both the commercial and government fronts.

The caveats

• International revenue remains the weaker limb
• Valuation after the rally is demanding — comments after the print put the stock in the high-30s to around 40 times the raised full-year sales figure
• Any deceleration in US commercial growth, a stumble in government budgets, or a sense that AIP bootcamps are not converting into durable contracts would be punished quickly
• Palantir remains a high-beta name; that has not changed

What the quarter still said about the future is constructive. Growth is no longer only government. Bookings and remaining deal value grew faster than revenue. Cash generation is no longer a promise; it is a feature. The strategic argument — keep the customer’s data inside the customer’s walls and put agents to work on an enterprise-controlled ontology — is landing at a moment when boards are nervous about handing operational data to model vendors.

The daily chart: congestion, then a break on rising volume

After the 4 August explosion, Palantir did what strong stocks often do: it went sideways and digested. From mid-August the daily range was messy rather than impulsive — highs into the low $180s, dips back through the $170s, a poke at $182.44 on 21 August that failed to stick, then another fade. That is congestion: buyers and sellers arguing about whether the $ 160s to $180s was the new home or just a rest stop. Volume cooled from the 175 million-share eruption on 4 August to more normal 25–40 million sessions.

Today’s session resolved that argument in favour of the bulls.

• Opened near $179
• High around $186.85
• Closed at $185.93, up about 4.8%
• Post-market around $184.90

That close sits above the mid-August supply zone. The daily chart has stopped chopping and has started trending again. A modest after-hours fade is a normal digest after a breakout day, not an immediate rejection. Levels that now matter:

• Breakout / first support: the old congestion cap around $180
• Failure tell: a close back in the $170s would turn today into another false start
• Next reference: the November 2025 all-time high at $207.52

We have traded those swings before. The difference this time is the fundamental backdrop: profitability is no longer theoretical, and commercial growth is still accelerating.

Can Palantir take out $207.52?

From $185.93, the all-time high is not a moonshot. It is a measured move if the trend resumes.

Why it can happen in due course:

• Full-year revenue guided near $8.15 billion, US commercial growth guided at 134% or better, cash flow guided at $4.5–$4.7 billion
• The technicals have flipped from digestion to expansion
• Net retention in the 150s and remaining deal value growing faster than revenue give the market a reason to keep giving the stock the benefit of the doubt

Why it is not a slam dunk:

• Valuation leaves little room for a soft quarter
• Getting back to the November 2025 high will require the broader AI complex not to roll over
• Government work is both a feature and a risk; commercial momentum is cleaner, but still concentrated in the United States

The honest answer is yes — we could see the all-time high taken out in due course, as a base case if Q3 looks anything like the guide and if this daily breakout holds. It is not guaranteed tomorrow, and it is not the sort of level you chase blindly after a 50% bounce off the July lows. It is the sort of level a holder can plan around.

How David and I are treating it:

Palantir is a core holding and a trading vehicle. The long position is there because the software is embedded in customers who do not rip it out after one budget cycle, and because the financial model has begun to look more like that of a great software company than a story stock. The trading overlay is there because $PLTR still moves in violent ranges, and those ranges have paid us on the way up. Today’s close at $185.93, with the stock hanging near $184.90 after hours, is the first daily signal since the earnings spike that the range may be finished. If it is, $207.52 is no longer a memory. It is the next obvious reference on the chart.
By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

Nvidia Earnings (NVDA): Has the Gloss Finally Come Off the Market’s Former Darling?

Nvidia reports earnings after the close today (4 pm EST / 21:00 BST), and the setup feels different from the explosive chapters of the last couple of years. The stock that once moved 8–15% (or more) on results nights has been trading in a much quieter, more constrained fashion. The question hanging over the market is straightforward: has the gloss finally worn off, and what kind of percentage move should we realistically expect once the numbers drop?

The Technical Picture: Waterlogged Since Early May

From a pure price-action standpoint, NVDA has been stuck in a classic range-bound, “waterlogged” structure for the better part of four months. Since the early-May peak near $236 (a 52-week high of $236.54 on 14 May), the stock has largely oscillated between roughly $190 and $230. That $40-wide band has contained the majority of the action. Late July saw a test of the lower end (closing as low as $190.01 on 29 July), followed by a recovery. The first week of August produced what looks like a textbook trap: a wide-spread up candle (or sequence of strong advances) that pushed price higher on below-average volume.

That kind of move — expansive range with limited participation — is a classic warning that the advance lacks conviction. It duly failed, and the sell-off over the last week and into this week has pulled the stock back toward the middle to lower half of the range. As of midday on 26 August, the shares are hovering around the $210–$213 area, having given back a good portion of the early-August bounce. Volume has been mixed, and the overall character has been one of compression rather than expansion. In short, the explosive, high-volatility personality that defined NVDA through much of the AI boom has been replaced by a more pedestrian, range-trading regime.

Why the Volatility Has Faded

Several factors explain the loss of the old wild swings:

• Maturity of the AI narrative. The early explosive upside was driven by repeated “beat-and-raise” cycles that continually reset expectations higher. As the numbers have scaled into the tens of billions (and now approaching the $90bn+ quarterly revenue zone), the incremental surprise required to move the needle has become larger. Markets have already priced in more of the growth story.
• Positioning and ownership. NVDA is no longer a relatively overlooked semiconductor name; it is a multi-trillion-dollar behemoth with enormous institutional and retail ownership. Large, widely held stocks tend to exhibit lower relative volatility once the initial discovery phase ends.
• Macro and rates backdrop. Higher-for-longer rate environments and periodic risk-off periods in the broader market have capped the upside enthusiasm that previously amplified every positive data point.
• Technical digestion. After the parabolic run of prior years, a multi-month consolidation was always likely. The $190–$230 range has been the market’s way of digesting the gains and waiting for the next fundamental catalyst.

The result is a stock that still has institutional respect but has lost the “must-own-at-any-price” fever that once characterised it.

What the Options Market Is Pricing for Tonight

Heading into the release, options imply a move in the range of roughly 5–6% in either direction (various sources cluster around 5.4%-5.9%). That is meaningfully lower than the double-digit swings of the early AI boom and also below some of the longer-term historical average absolute post-earnings moves (which have often run 6–8%+). Recent history has been even more muted and frequently negative: several of the last handful of reports produced single-digit declines or modest reactions despite solid beats. The market appears to be saying that a clean beat on the expected ~$92bn revenue / ~$2.09 adjusted EPS (versus the company’s own prior guide of $91bn ±2%) may not be enough on its own. Guidance, commentary on Blackwell ramp, Rubin progress, data-centre demand visibility, and any China-related colour will matter more than the pure beat size.

What to Expect After 4 pm EST

We will see. A 5–6% move would take the stock toward the mid-$220s on the upside or the high-$190s / low-$200s on the downside — still comfortably inside the larger $190–$230 range that has defined the last few months. A larger outlier move is always possible (Nvidia has delivered them before), but the current volatility regime and the “trap” character of the early-August advance suggest the path of least resistance may be a more contained reaction than the fireworks of old.If the numbers and outlook are strong enough to break the upper end of the range with conviction and volume, the “gloss” narrative gets a temporary reprieve.

If the reaction is muted or negative despite solid results, it will reinforce the view that the easy, high-volatility upside phase is behind us and that NVDA has entered a more mature, range-bound chapter. Either way, the technical structure has already told us a great deal: this is no longer the unstoppable momentum monster of 2023–2025. It is a still-dominant franchise that has been waterlogged for months, trapped once already in August, and is now waiting for the next fundamental catalyst to decide whether the range resolves higher or lower. The numbers drop in a few hours. The chart has been patient. Tonight we find out whether the market is still willing to pay a premium for the old magic — or whether the gloss has, for now, come off and hazed into a dull shine.
By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

SPCX Stock Analysis August 2026: Daily Chart VPA Signals, Early August Bottom Rally & $149 Resistance

SPCX stock analysis – SpaceX’s journey as a public company has been nothing short of dramatic since its historic June 12, 2026 IPO under the ticker SPCX. Priced around $135 and rocketing to an all-time high near $225.64 within days amid deal excitement (including the Cursor acquisition and the broader AI narrative), the stock then endured a sharp multi-week correction. That sell-off, which we covered extensively during the early-July period, took it down through key levels and into a clear bearish trend, bottoming in early August around the $104.83 low printed on August 3. From that trough the stock has staged an impressive recovery, but the character of the advance—particularly the volume behaviour—now demands careful attention for anyone looking to time entries.

Fundamental Backdrop Supporting the Recovery – SPCX stock analysis

Let’s start with the broader context before drilling into the daily chart. SpaceX operates across three core pillars: Space (rockets and Starship development), Connectivity (Starlink broadband), and AI (the integrated xAI/Grok, X platform, and compute infrastructure pieces). Q2 2026 results, the first major report as a public company, showed the growth engine firing:

• Revenue of roughly $7.8 billion, up an eye-catching 92% year-over-year
• Net loss narrowing to about $541 million
• Adjusted EBITDA surging to around $3.5 billion

Connectivity remains the reliable cash-flow driver with solid subscriber growth and operating contributions, while AI delivered explosive percentage gains (albeit still loss-making at the operating level due to heavy investment). The Space segment continues advancing Starship V3 tests toward full reusability. The balance sheet is fortress-like after the IPO (net proceeds in the $85–86 billion range) and a large investment-grade bond issuance, leaving the company with approximately $100 billion in cash and equivalents plus a substantial backlog. Analyst consensus remains constructive (predominantly Buy ratings) with average 12-month targets clustered in the $210–230 zone, though the range is wide and valuation remains elevated relative to current earnings power. That fundamental backdrop explains why the stock found buyers at the early-August lows.

Daily Chart Price Action: From the Early August Bottom

The daily chart from that point tells a clear Volume Price Analysis (VPA) story. After the August 3 low near $104.83 and a volatile couple of sessions (including a sharp dip back toward $108 on August 5 on elevated volume), the real rally ignited around August 6–7. Price closed August 6 near $115, then exploded higher on August 7 to $133.11, accompanied by massive volume in the 240–255 million-share range—classic high-volume accumulation and buying climax off the bottom. Subsequent sessions continued the advance:

• August 10 pushed toward $139
• August 12 printed a high of $149.60 and closed near $146 on still-robust volume around 167 million
• The move extended into August 17 with another test of the $149.80 area and a close around $146

Classic VPA Exhaustion Signal During the Rally

Here is the critical VPA signal for SPCX stock analysis. While price was rising steadily from the mid-$110s into the high-$140s between roughly August 6/7 and August 17, the volume profile was declining. The initial thrust days saw 240–255 million shares; later up days saw volume step down into the 160–120 million range and lower. This is textbook exhaustion: price can still climb, but the effort (volume) required to push it higher is diminishing. It does not automatically signal an immediate reversal from primary uptrend to primary downtrend—especially in a stock with this much underlying momentum and institutional interest—but it is a clear warning flag that buying pressure is tiring and that supply is beginning to meet demand more effectively at higher levels. In VPA terms, rising prices on falling volume often precede a pause, consolidation, or corrective phase rather than a clean continuation.

The Critical $149 Resistance Level

That warning proved timely. The $149 zone has now established itself as a very clear short- to medium-term ceiling of resistance. Interestingly, this same area had previously served as a strong support platform earlier in the stock’s life, before the breakdown into the July bearish trend we discussed in prior posts. Once a former support level is broken and then retested from below, it frequently flips into resistance—exactly what we are observing. Price tagged the $149–150 region twice (August 12 and 17 highs) but could not sustain above it. Since then, the stock has moved sideways to modestly lower, consolidating just beneath that ceiling.

Recent Sessions: Narrow Candles and Modest Selling

Looking at the most recent sessions reinforces the picture. Thursday, August 20 saw a pullback to a close of $134 on elevated volume near 120 million (perhaps residual unlock-related supply), while Friday, August 21 has been characterised by modest selling pressure contained within narrow-range candles and notably lighter volume (in the 50–60 million area). Narrow candles on declining volume after a multi-week advance typically indicate that sellers are not in aggressive control; rather, the market is digesting, waiting, and building energy. This kind of tight price action just below a well-defined resistance often precedes either a successful retest and potential breakout (if volume expands on the upside) or a more prolonged consolidation / secondary pullback if the $149 barrier continues to reject advances.

Timing the Next Move: Key Levels to Watch

So where does that leave timing and the decision of if/when to buy? The $149 level is now the pivotal short- and medium-term reference that will dictate the next leg of price action. Key scenarios include:

• A decisive break and daily close above $149–150 on expanding volume would neutralise the exhaustion signal, flip the old support/resistance dynamic once more, and open the door toward higher targets (perhaps retesting the mid-$160s or beyond)
• Failure at that ceiling combined with a break below recent swing lows (around the $130–132 zone) would suggest the exhaustion has translated into a deeper corrective phase, potentially retesting the $120s or even probing back toward the August lows

For now, the daily chart is in a classic post-rally consolidation phase beneath resistance. The high-volume bottom in early August, the subsequent rising-price/falling-volume advance, the clear $149 ceiling, and the current narrow-range action with modest volume all fit neatly into a VPA framework of accumulation → markup with diminishing effort → pause. Fundamentals remain supportive of the longer-term bull case—Starlink scale, Starship progress, AI optionality, and a rock-solid balance sheet—but near-term price discovery is being governed by this technical structure and residual supply dynamics (including share unlocks).

Summary and Outlook

In summary, SPCX has recovered impressively from the early-August trough, yet the declining volume during the heart of the rally flashed a classic exhaustion warning. The stock now sits in a sideways-to-modestly lower range just below the critical $149 level that once served as support. Yesterday’s and today’s narrow candles on relatively contained volume keep the door open for a renewed test of that level in due course. Patience on the timing front is warranted: wait for either a high-volume breakout above $149 to confirm continuation, or for clearer evidence that support is holding on any further pullback before committing fresh capital. As always with a name of this volatility and narrative power, position sizing and risk management remain paramount.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

Oil Trading Essentials: Backwardation, Crack Spreads, Futures, Hormuz & Today’s Inventory Surprise

Oil trading in the markets in mid-August 2026 remains highly sensitive to both geopolitical risk and fundamental data. West Texas Intermediate (WTI / Light Crude) has been trading in the mid-$80s, with price action on the daily chart recently stalling near $84.30 as it attempts to push higher toward $85–86. Brent continues to command a premium around $91–92. For traders, understanding the market’s structure is as important as watching the headline price. Four concepts stand out: backwardation, the crack spread, how oil futures actually work, and the ongoing Strait of Hormuz supply disruption. Today’s EIA crude inventory report adds another layer of clarity (and complexity).

1. Backwardation – What It Is and Why It Matters

In a normal oil trading (contango) market, futures prices for later delivery months trade higher than the front-month contract. This reflects storage costs, financing and the expectation of ample future supply. Backwardation is the opposite: the front-month (or near-term) contracts trade at a premium to later-dated contracts. The futures curve slopes downward. Why does this happen?

• Immediate physical supply is tight relative to demand.
• Refiners and end-users are willing to pay a premium for prompt barrels.
• Geopolitical risk (or inventory draws) makes nearby oil more valuable than oil promised months ahead.

In the current environment, the oil complex has returned to clear backwardation. Front-month WTI and Brent prices sit meaningfully above contracts further out the curve. This structure rewards traders who are long the front month and roll their positions forward (i.e., a positive roll yield). It also signals that the market is prioritising near-term scarcity over longer-term abundance. For anyone trading oil, the shape of the curve is often a more reliable guide to the market’s true tightness than the absolute price level alone.

2. The Crack Spread – The Real Measure of Refining Strength

Crude oil itself is only part of the story. What matters to consumers and to refiners is the margin earned by turning crude into gasoline, diesel and other products. That margin is measured by the crack spread. The classic 3-2-1 crack spread assumes three barrels of crude are refined into two barrels of gasoline and one barrel of diesel/heating oil. The calculation is straightforward:(2 × Gasoline price + 1 × Diesel price) – 3 × Crude price (all expressed on a per-barrel basis). In August 2026, the crack spreads — especially the diesel crack — have exploded to historic highs. Diesel cracks have recently traded above $100 per barrel, far above normal historical ranges of $15–25. The broader 3-2-1 spread has also remained exceptionally elevated. Why is this critical right now?

• It shows that refined-product markets are tighter than the crude market.
• High cracks encourage refiners to run at maximum rates and can delay maintenance.
• Elevated diesel margins feed directly into higher costs for trucking, agriculture and industry — and therefore into broader inflation.
• Traders can trade the crack itself (or use it as a leading indicator for energy equities and product-linked instruments).

In short, while crude prices have been volatile, the crack spread has consistently told a bullish story of product tightness.

3. How Oil Futures Work – A Practical Overview

Most oil trading by speculative and institutional participants occurs via futures contracts, primarily on the NYMEX (WTI) and ICE (Brent). Key features:

• Each contract represents 1,000 barrels.
• Contracts are standardised and expire monthly.
• Most positions are closed or rolled before expiry; physical delivery is rare for pure traders.
• Margin requirements allow significant leverage.
• The front-month contract is the most liquid and is the one quoted in most media headlines.

Because the market is often in backwardation or contango, the cost (or benefit) of rolling from one contract to the next becomes an important part of returns. Understanding the curve, the roll process, and the difference between cash-settled and physically deliverable contracts is essential for risk management.

4. The Strait of Hormuz – The Dominant Supply Narrative

Roughly one-fifth of global oil trade normally passes through the Strait of Hormuz. Since the escalation of US–Iran tensions earlier in 2026, flows have been repeatedly disrupted. At various points traffic has fallen dramatically, alternative routes (Saudi Red Sea terminals, UAE Fujairah) have been pushed to capacity, and a persistent geopolitical risk premium has remained embedded in prices. As of mid-August 2026, the situation remains one of “limbo”: neither fully closed nor fully normalised. Shipping volumes stay well below pre-crisis levels, confidence in safe passage is low, and every diplomatic statement or incident produces an immediate reaction in the oil market. This ongoing uncertainty is the primary reason the futures curve has stayed in backwardation and why near-term prices continue to command a premium.

5. Technical Picture – Stalling Around $84.30 a Barrel

On the daily chart of Light Crude (WTI), price has recently encountered resistance / stalling behaviour near $84.30. After several sessions of recovery from the low-$80s, the market paused before extending toward the mid-$80s. Traders will be watching whether this zone acts as a pivot or whether a decisive break higher (or failure) develops in the days ahead. Volume-price analysis and the behaviour of the broader energy complex (including XLE) will help confirm the next directional move.

6. Today’s EIA Crude Inventory Report – And the CAD Link

The weekly EIA Petroleum Status Report (released every Wednesday) remains one of the most market-moving data points for oil. For the week ending 14 August 2026, the EIA reported:

• Commercial crude inventories rose 4.4 million barrels to 428.8 million barrels (versus expectations of a modest draw).
• Cushing, Oklahoma stocks fell 1.3 million barrels to 21.3 million.
• Gasoline inventories rose 0.7 million barrels.
• Distillate (diesel) inventories fell a further 1.5 million barrels and remain significantly below the five-year average.

A larger-than-expected crude build is typically viewed as bearish for prices in the short term. However, the continued tightness in distillates and the still-elevated crack spreads have limited the downside reaction so far. Prices actually held firm / moved higher after the release, underscoring that the Hormuz risk premium and product-market strength are currently outweighing the inventory data.

Impact on the Canadian dollar (CAD)

Canada is a major oil exporter, and the CAD is widely regarded as a commodity currency. Rising oil prices generally support the loonie; falling prices (or large inventory builds that pressure oil) tend to weigh on it. Traders watching USD/CAD therefore treat the EIA release as a secondary but still relevant input alongside broader risk sentiment and US interest-rate expectations.

Putting It All Together

Oil trading in the current environment requires more than a view on the headline price. Backwardation tells us the market is prioritising near-term scarcity. Record crack spreads reveal that refined products are even tighter than crude. Futures mechanics determine how that view is expressed and what the roll costs will be. The unresolved situation in the Strait of Hormuz remains the dominant supply risk. Technical levels, such as the recent $84.30 stalling area, provide tactical reference points, while the weekly EIA report offers a regular reality check on US balances — and a knock-on effect on currencies such as the CAD. Stay focused on the curve, the cracks, the chokepoint, and the weekly data. That combination will keep you aligned with the forces actually driving oil prices in the second half of 2026.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

Tracking Money Flow Through Sector ETFs: Rotation, GICS, Wyckoff & VPA in Action

In today’s markets, capital doesn’t stay put. It rotates constantly from one group of stocks to another as economic conditions, interest rates, commodity prices, geopolitical events and investor sentiment shift; in other words, sector rotation. One of the cleanest and most practical ways to follow this movement is through sector ETFs. These funds give us a high-level, liquid view of where the “smart money” is flowing — and when combined with classic volume-price analysis (VPA) and the principles of Richard Wyckoff, they become powerful tools for both traders and longer-term investors. This post explores how sector rotation works, how the Global Industry Classification Standard (GICS) organises the market, why healthcare and energy are currently attracting attention, and how Wyckoff’s three laws, plus VPA, help us read the story behind the price charts of major sector ETFs. What Are Sector ETFs and Why Do They Matter? Exchange-traded funds that track specific market sectors — such as the State Street Select Sector SPDRs — allow investors to buy or sell an entire industry group with a single trade. Popular examples include:

• XLE – Energy
• XLV – Health Care
• XLF – Financials
• XLK – Technology
• XLI – Industrials
• and the other six that complete the 11 GICS sectors.

Because these ETFs hold the largest companies in their respective sectors and trade with high volume, their price action and volume profiles often reflect institutional accumulation or distribution more clearly than individual stocks. When money rotates into a sector, the corresponding ETF typically shows rising prices accompanied by expanding volume. When money leaves, we frequently see price weakness on higher volume or failed rallies.

Understanding GICS: The Map of the Market.

To analyse sectors effectively, we need a consistent framework. The Global Industry Classification Standard (GICS), developed by MSCI and S&P Dow Jones Indices, provides exactly that. It is a four-tier hierarchical system used worldwide:

1. Sectors (11) – the broadest level
2. Industry Groups (25)
3. Industries (74)
4. Sub-Industries (163)

Every public company is assigned to one primary sub-industry based mainly on its revenue sources (with earnings and market perception also considered). This classification then rolls up automatically into the higher tiers. The 11 GICS sectors are:

• Energy
• Materials
• Industrials
• Consumer Discretionary
• Consumer Staples
• Health Care
• Financials
• Information Technology
• Communication Services
• Utilities
• Real Estate

This structure lets us move seamlessly from the big picture (sector ETFs) down to finer groups or individual stocks when we want more granularity. For example, within Health Care we can look at Pharmaceuticals, Biotechnology, Health Care Equipment, or Managed Health Care. Within Energy we can distinguish Integrated Oil & Gas from Exploration & Production or Oil Equipment & Services.

Sector Rotation: How Money Flows

Sector rotation is the process by which capital moves from one group of stocks to another as the economic cycle progresses or as specific catalysts emerge. Classic models link rotation to the business cycle:

• Early recovery often favours Financials, Consumer Discretionary and Industrials.
• Mid-cycle expansion tends to support Technology and Communication Services.
• Late-cycle and inflationary periods frequently benefit Energy, Materials, and sometimes Health Care.
• Defensive phases (slowdowns or uncertainty) typically see money flow into Consumer Staples, Utilities and Health Care.

In practice, the picture is more fluid. Geopolitical shocks, commodity spikes, regulatory changes, interest-rate expectations or technological breakthroughs can accelerate or reverse flows independently of the classic cycle. The key is to observe the evidence on the charts rather than force a narrative. Sector ETFs make this observation straightforward. By comparing relative strength, absolute performance and volume behaviour across the 11 Select Sector SPDRs, we can see which areas are attracting capital and which are being abandoned.

Current Leadership: Health Care and Energy

As of mid-August 2026, two sectors stand out. Energy (XLE) has delivered strong year-to-date gains (in the region of 40%+ total return) and has shown clear technical strength. On the daily chart, it has broken out of multi-week-or-longer consolidation patterns, with price moving to new relative highs on expanding volume. This is classic evidence of demand overcoming supply. Rising oil prices, geopolitical tensions, and structural demand driven by data-centre power needs have all contributed, but the chart itself tells the story of institutional buying. Health Care (XLV) has also performed well, particularly over recent weeks and months.

It has shown steady relative strength, often ranking among the better-performing sectors on weekly or monthly measures. Attractive valuations relative to the broader market, improving earnings visibility, M&A activity and a rotation out of more crowded growth areas have supported the sector. Defensive characteristics combined with genuine growth drivers (especially in certain biotech and pharma names) make it appealing in the current environment. These are not isolated moves. When we see several related industry groups or sub-industries confirming the sector ETF’s strength, the rotation becomes more reliable.

Wyckoff’s Three Laws – The Foundation

Richard D. Wyckoff developed his method in the early 20th century by studying the behaviour of large operators (“the Composite Man”). At its core are three interlocking laws that still apply perfectly to modern sector ETFs:

1. The Law of Supply and Demand
   Prices rise when demand exceeds supply and fall when supply exceeds demand. When the two forces are roughly balanced, price moves sideways. Volume helps us judge the intensity of each side.
2. The Law of Cause and Effect
   Significant price moves (the “effect”) are preceded by periods of preparation (the “cause”). Accumulation ranges build the cause for a markup; distribution ranges build the cause for a markdown. The longer and more intense the cause, the larger the subsequent effect tends to be.
3. The Law of Effort versus Result
   Volume is the effort; price movement is the result. When effort and result are in harmony (rising price on rising volume, or falling price on rising volume), the trend is healthy. Divergences — high volume with little price progress, or low volume on a sharp move — often signal a change in the balance of supply and demand.

These laws provide a logical framework for interpreting any chart, including sector ETFs.

Volume Price Analysis (VPA) – Putting the Laws to Work

VPA is the practical application of Wyckoff’s principles. It focuses on the relationship between price bars and the volume that accompanies them. Key observations include:

• Strong advances on expanding volume suggest genuine demand.
• Advances on declining volume may indicate a lack of conviction (potential weakness).
• Selling climaxes or high-volume reversals can mark exhaustion.
• Narrow-range days on high volume often signal absorption of supply (or demand).
• Wide-range days on low volume can be less reliable.

When applied to sector ETFs, the same principles hold. Because these funds are highly liquid and widely followed by institutions, their volume spikes frequently reflect real money flow rather than retail noise. For example, in the recent Energy move, breakouts accompanied by rising volume would be interpreted as effort confirming result — demand is in control. In Health Care, steady price appreciation with supportive volume suggests accumulation rather than a short-covering spike.

Bringing It All Together – A Practical Process

1. Start with the 11 sector ETFs and rank them by relative strength over multiple timeframes (1 week, 1 month, 3 months).
2. Examine the leaders for confirmation via VPA — is volume supporting the price move?
3. Drill down using the GICS hierarchy for more precision (industry groups or sub-industries).
4. Apply Wyckoff’s laws: Is there a clear cause (trading range) that has been resolved? Does effort match result?
5. Monitor for signs of rotation out of the current leaders (distribution characteristics) and into new ones (accumulation).

This top-down approach keeps you aligned with the broader flow of capital while still allowing stock-specific selection when opportunities appear inside the strongest sectors.

Final Thoughts

Sector ETFs give us a transparent window into the continuous reallocation of capital across the market. By understanding the GICS framework, we know exactly what each ETF represents. By applying Wyckoff’s three laws and VPA, we can judge the quality of the moves we see. Right now, Energy’s breakout and Health Care’s relative strength offer clear examples of money in motion. Markets will keep rotating. The advantage goes to those who can read the signs early and act with the evidence rather than against it. Sector ETFs, analysed through the lens of volume and price, remain one of the most effective ways to stay on the right side of that flow.

By Anna Coulling – creator of volume price analysis

 

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Boston Scientific (BSX): A Classic VPA “Hockey Stick” Reversal – When Narrowing Spreads and Absorption Signal the Turn

In the world of Volume Price Analysis (VPA), few patterns are as satisfying—or as reliable when read correctly—as the “hockey stick.” This is the extended decline that eventually loses momentum, decelerates into a low with clear evidence of buying absorption, and then turns higher. Boston Scientific Corporation (NYSE: BSX) has delivered a textbook example on the weekly chart in recent months. What makes this setup particularly compelling is the confluence of classical VPA signals, a catalyst from the July 29 earnings release, notable insider buying by the C-suite, and the ongoing need to monitor dark-pool activity to confirm institutional accumulation. This is the kind of chart that rewards patience. Narrowing spreads really do reveal all.

Company Background: A leader in Minimally Invasive MedTech

Boston Scientific, founded in 1979 and headquartered in Marlborough, Massachusetts, develops, manufactures, and markets a broad portfolio of medical devices used in interventional procedures. Its two main segments are Cardiovascular (including cardiology and peripheral interventions) and MedSurg (endoscopy, urology, and neuromodulation). The company is a major player in areas such as electrophysiology (EP), structural heart (notably the WATCHMAN left atrial appendage closure device), pulsed field ablation (FARAPULSE platform), and various endoscopic and urological tools. It treats tens of millions of patients annually across more than 120 countries and invests heavily in R&D. Long-term secular tailwinds—ageing populations, the shift toward less-invasive procedures, and innovation in cardiac and neuromodulation therapies—remain intact. Yet even strong companies can experience sharp share-price corrections when growth expectations are reset.

Why Boston Scientific Fell So Far

BSX reached an all-time high near $109.50 in September 2025. From there, the stock endured a prolonged and severe decline of roughly 50–60%, eventually finding support in the low-$40s to mid-$40s range by mid-2026. The primary drivers were successive reductions in full-year 2026 guidance. After delivering solid results, management repeatedly tempered organic revenue growth expectations—initially guided in the low double digits, then lowered in stages to a mid-single-digit range (most recently 5–6% organic). Key pressure points included:

• Flattening U.S. sales of the WATCHMAN franchise, attributed in part to physician workflow constraints and a shift toward concomitant procedures rather than standalone implants.
• Softening trends and increased competition in electrophysiology.
• Broader concerns about growth deceleration in certain high-profile categories.

These guidance cuts triggered multiple waves of analyst target reductions and a re-rating of the multiple. Even when quarterly results beat estimates, the forward outlook often overshadowed the beats, creating a classic “sell the news / sell the guidance” environment. By the time the stock approached its lows, sentiment had become extremely cautious—exactly the backdrop in which VPA absorption signals often appear.

The Weekly Chart: Classic VPA Hockey Stick and Absorption

On the weekly timeframe, the price action formed a clear hockey-stick pattern. After the sharp fall from the 2025 highs, the decline began to decelerate. Selling pressure that had previously driven wide-range down candles started to lose force. At the lows, we saw the classic VPA absorption signatures that experienced traders watch for:

• High volume appearing on successive narrow-spread candles.
• Small or non-existent lower wicks, indicating that sellers were unable to push price meaningfully lower despite elevated activity.
• Spreads progressively narrowing as the market moved sideways or slightly higher off the bottom.

In VPA terms, this is the footprint of professional money absorbing the supply being offered by weaker hands or forced sellers. The high volume is not distribution; it is accumulation occurring under the cover of residual selling. Once that supply is largely absorbed, the path of least resistance shifts higher. This is precisely the pattern many of us look for repeatedly across markets and timeframes. It requires patience because the absorption phase can last several weeks, but once the move higher begins, it often carries meaningful follow-through. The July 29 earnings release provided the catalyst that helped convert the accumulation into a more visible bullish trend.

July 29 Earnings: The Catalyst

On Wednesday, July 29, 2026, Boston Scientific reported second-quarter results that beat expectations on both the top and bottom lines. Net sales reached $5.442 billion, up 7.5% reported and 7.0% organic—hitting the high end or exceeding prior guidance ranges. Adjusted EPS came in at $0.86, above the $0.82–$0.84 guided range and up solidly from the prior year. Cardiovascular growth was healthy, and international regions (particularly APAC and Latin America) delivered strong performances. The company also highlighted product progress, including clearances and positive clinical data for several platforms, as well as a strategic $1.5 billion investment in MiRus with an option on the TAVR business. Management lowered full-year 2026 guidance once more (organic growth now expected in the 5–6% range and adjusted EPS of $3.28–$3.32). In isolation, that might have been viewed negatively. Yet the combination of a clean beat, evidence of continued execution, and the fact that much of the bad news on growth had already been discounted helped spark the reversal. The stock moved higher from the absorption zone, confirming the VPA read that buying had already been taking place under the surface.

C-Suite and Director Buying: Confidence at the Lows

One of the more encouraging developments has been the cluster of insider purchases by corporate insiders in late July and early August 2026. Most notably:

• CEO and Chairman Michael F. Mahoney purchased roughly 186,000–208,000 shares in early August for approximately $9–10 million at prices around $48.
• Director David C. Habiger made multiple purchases in the first week of August at prices in the $47–$48 range.
• Director Edward J. Ludwig bought shares near the end of July around $45.50.

When the CEO and multiple directors are writing personal checks at levels well below the previous highs—and after a multi-month decline—it is a meaningful signal of internal confidence. These are not token purchases. They occurred in the same price region where the weekly VPA absorption was most evident, reinforcing the idea that informed participants saw value.

Monitoring the Dark Pools

While the weekly chart and public volume have already shown absorption, we continue to monitor dark-pool activity for further confirmation of institutional flow. Dark pools (and other off-exchange venues) often handle large block trades that do not immediately appear in the lit market. Unusual or sustained dark-pool buying at key support levels can precede or accompany the type of accumulation we observed on the weekly candles. In a name like BSX, where institutional ownership is significant, tracking these prints alongside the VPA structure helps distinguish true absorption from temporary pauses in selling. So far, the overall picture remains consistent with professional money building positions during the decelerating phase of the decline.

Patience, Narrowing Spreads, and the Classic Setup

This entire episode is a reminder of two enduring VPA principles. First, markets do not reverse on a single candle; they reverse after supply has been absorbed. The hockey-stick shape—steep decline followed by a flattening base with rising volume on narrowing ranges—is the visual evidence of that process. Second, narrowing spreads on high volume at the lows almost always reveal the true intent of the larger players. Patience is required because the absorption phase can feel protracted, especially after a 50%+ decline that has damaged sentiment. Yet once the catalyst arrives and the move higher begins, the risk/reward for those who waited for confirmation improves markedly.

BSX has now transitioned from a prolonged downtrend into what appears to be the early stages of a more constructive bullish trend on the weekly timeframe. Of course, challenges remain—competition in key categories, the need to re-accelerate growth in WATCHMAN and EP, and the broader market environment. No single pattern guarantees future performance. But from a pure VPA perspective, the combination of clear absorption, an earnings catalyst, and meaningful insider buying has produced a high-quality setup of the type we continuously scan for. For traders and investors who combine volume-price analysis with fundamental catalysts and insider activity, Boston Scientific currently offers a live case study in how patience and careful reading of the tape can identify opportunity after a painful decline.

The narrowing spreads told the story; the subsequent price action is now confirming it. We will continue to monitor the dark pools and the weekly structure for ongoing evidence that the absorption phase has been completed and a more sustained advance is underway.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

Onterris (ONT) Follow-Up: The Monster Hammer, Climactic Volume & Classic VPA Absorption

Two days ago we examined Onterris (NYSE: ONT) after the company cut full-year guidance, launched a Board-led strategic review and adopted a limited-duration stockholder rights plan (the “poison pill”) in response to significant undisclosed accumulation of shares and derivatives. (Read the full post here: The Poison Pill. The market’s initial reaction was brutal. On 6 August, the stock suffered a savage sell-off, only to produce one of the clearest Volume Price Analysis signals we have seen in recent months. This follow-up examines exactly what unfolded on the chart, why the volume and candlestick combination is so significant from a VPA perspective, and what it may tell us about the hidden buyer the Board was trying to deter.

The Price Action in Detail

On 5 August, ONT closed at $22.63 on relatively normal volume of roughly 376,000 shares. The following day, 6 August, the stock opened sharply lower at $15.28 and continued to collapse, printing an intraday low of $12.68. That represents a decline of more than 43 % from the prior close at the extremes. Yet the session did not end in capitulation. Buyers stepped in aggressively, lifting the price all the way back to a close of $15.09. The resulting daily candle is a textbook long-legged hammer (or deep-body recovery candle with a very long lower wick). The open was $15.28, the low $12.68 and the close $15.09 — almost back to the opening level after a 20 %+ intraday recovery from the lows. Crucially, this occurred on 3.037 million shares — roughly six to eight times the stock’s recent average daily volume (typically in the 350–500k range, occasionally higher). This is not ordinary participation. This is climactic volume. On 7 August the stock continued the recovery, trading as high as the mid-$17s (around $17.50–$17.80 in early trade) — a gain of more than 16 % from the previous close and a substantial rebound from the $12.68 panic low.

Classic Volume Price Analysis Reading

In Volume Price Analysis, the relationship between effort (volume) and result (price movement) is paramount. Here the effort was enormous: more than three million shares changed hands on the downside. The result, however, was incomplete. After the initial cascade, price refused to stay at the lows. The long lower wick shows that sellers were met by equally determined buyers who absorbed the supply and pushed the market back up. This is the hallmark of absorption or a selling climax. When ultra-high volume accompanies a sharp decline that then reverses significantly into the close, the professional money is usually on the other side of the retail (or forced) selling. The market makers, institutions or the undisclosed accumulator the Board referenced are frequently the parties willing to take the other side of panic flow at distressed prices. A pure “buying climax” often marks the end of a decline, at least temporarily. In this case it’s ONE candle!! When it is followed the next day by strong follow-through to the upside on continued interest, the probability that the low was significant rises further. The fact that this extreme volume day occurred immediately after the poison-pill and strategic-review announcements makes the signal even more interesting. The news flow provided the catalyst for the emotional selling; the volume and recovery reveal who was prepared to buy it.

Who Is Buying — Market Makers or the Hidden Accumulator?

We still do not know the identity of the party (or parties) behind the “significant and undisclosed accumulation” that prompted the rights plan. That remains opaque by design. However, the price action of 6–7 August is consistent with at least one of two scenarios (or a combination of both):

1. The original undisclosed buyer is still active
   A sophisticated accumulator who has been building a position quietly (via dark pools, derivatives or staggered purchases) would view a 40 %+ panic drop as an opportunity to add substantially cheaper shares. The poison pill limits how large a stake can be taken without triggering dilution, but it does not prevent further buying below the 15 % threshold. High-volume absorption at the lows is exactly the behaviour one would expect from a determined buyer who still wants more stock.
2. Opportunistic institutions and market makers
   Once the initial wave of forced or emotional selling hit the tape, professional liquidity providers and value-oriented funds often step in. The strategic review itself raises the possibility of a future sale or other value-unlocking transaction. Buying a temporarily dislocated stock that is now under formal review can be an attractive risk-reward proposition for those with a medium-term horizon.

In practice, these two groups can overlap. Market makers facilitate flow while proprietary desks or affiliated entities may also be positioning. The net effect visible on the chart is the same: supply was absorbed and price recovered.

Implications for the Strategic Review and Potential Takeover Narrative

The Board adopted the rights plan specifically to protect the integrity of the strategic review and to prevent any party from gaining control without paying a fair price to all shareholders. The extreme volume and recovery do not change that legal framework, but they do reinforce the underlying premise: someone has been, and may still be, interested in the stock at these levels.If the rebound holds and volume remains elevated on the way up, it increases the likelihood that the review process will attract serious attention — whether from the existing undisclosed holder, other strategic buyers, or both. Conversely, if the recovery fades on declining volume, the 6 August low may simply have been a short-term exhaustion point within a larger downtrend.For now the VPA evidence leans constructive on a short-to-medium-term basis. Climactic volume followed by a strong recovery candle is one of the higher-probability reversal or accumulation signals in the methodology.

What We Are Watching Next

Several developments will clarify the picture:

• Volume behaviour on the rebound — Does the strength continue on above-average volume, or does participation dry up?
• Ability to hold above the 6 August mid-point and prior support zones — Sustained trading above $15–$16 would confirm that the panic low has been defended.
• Any Schedule 13D or 13G filings — Disclosure of a large position would finally identify the accumulator.
• Further commentary from the company on the strategic review timeline or process.
• Options activity and dark-pool prints — Continued unusual activity would support the accumulation thesis.

Positioning Perspective

We are holding the stock for the short-to-medium term precisely because of this VPA signal.

The combination of a formal strategic review, an existing undisclosed buyer, a poison-pill defence, and now a high-volume absorption day creates a set of conditions that is relatively uncommon. The downside has already been expressed in violent fashion; the recovery demonstrates that demand exists at these levels. None of this guarantees a successful takeover or a rapid re-rating. Guidance has been cut, the emergency-response business remains soft, and the rights plan itself can deter some potential acquirers. Yet from a pure Volume Price Analysis standpoint, the 6 August session was a clear demonstration of effort being met by opposing force — the classic footprint of professional buying into weakness.The story of Onterris is still unfolding. The poison pill was the corporate response to quiet accumulation. The monster hammer on massive volume may be the market’s response to the ensuing panic. Whether the hidden buyer is still adding, or whether new participants have simply recognised value, the chart has spoken clearly: at $12.68 the selling was exhausted and the buying began in earnest. We will continue to monitor the volume profile closely as the strategic review progresses.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

Onterris (ONT) Poison Pill, Strategic Review & Undisclosed Accumulation: A Rare Setup for Traders

On 5 August 2026, Onterris, Inc. (NYSE: ONT) delivered a textbook example of how corporate defence, operational headwinds and quiet accumulation can collide in a single trading session. The environmental services company reported weaker-than-expected second-quarter results, cut its full-year guidance, announced a comprehensive Board-led strategic review, and adopted a limited-duration stockholder rights plan (the classic “poison pill”). The share price, which had closed the regular session around $22.60–$22.80, plunged sharply in after-hours trading toward the mid-to-high teens.For traders who focus on Volume Price Analysis, corporate actions and the footprints of larger players, this combination is relatively rare and therefore instructive. It raises clear questions about background, motivation, immediate implications for shareholders, and the range of possible medium-term outcomes.

Company Background

Onterris is the rebranded form of Montrose Environmental Group. The name change and ticker switch from MEG to ONT took effect on 4 May 2026. The company provides environmental consulting, laboratory testing, treatment and related services across the United States, Canada and Australia. Its work often involves complex regulatory, air, water and soil challenges, including areas such as PFAS treatment and emergency response. Like many specialised service businesses, revenue can be lumpy. A meaningful portion has historically come from environmental emergency response and recovery work, which is inherently unpredictable. The company has grown through organic expansion and bolt-on acquisitions, maintains a share-repurchase programme, and had been targeting margin improvement even as it navigated variable top-line conditions.

What Triggered the Announcements

In the second quarter of 2026, revenue fell to $186.7 million from $234.5 million a year earlier. Management attributed the decline primarily to historically low environmental emergency response activity, lower pass-through revenue, and some temporary regulatory effects on certain testing work. Adjusted EBITDA came in at $31.9 million (17.1 % margin). While adjusted earnings per share beat some expectations, the top-line miss was clear. Full-year 2026 guidance was lowered: revenue to $740–$790 million (from $840–$900 million) and Consolidated Adjusted EBITDA to $117–$120 million (from $125–$130 million). Management still pointed to expected margin expansion and solid second-half cash-flow generation, but the reduction was material.Alongside the numbers, the Board announced a comprehensive strategic review covering the business, portfolio, capital allocation, long-range plan and strategic alternatives—including the possibility of evaluating acquisition interest. No timetable or preferred outcome was given.To protect that process, the Board adopted a one-year limited-duration stockholder rights plan, effective immediately and expiring on 4 August 2027. The stated reason was “significant and undisclosed accumulation of Onterris shares and derivative securities.”

How the Poison Pill Works

The rights plan is a classic defensive mechanism. The company declared a dividend of one preferred share purchase right for each common share outstanding, payable to stockholders of record on 17 August 2026. Each right entitles the holder to purchase one one-thousandth of a Series B Preferred Share at an exercise price of $105 (subject to adjustment). These rights initially trade with the common shares. They become exercisable and trade separately only if a person or group acquires beneficial ownership of 15 % or more of the outstanding common shares (or launches a tender/exchange offer that would result in such ownership). At that point the rights of the acquiring person become void, while other holders can exercise at a substantial discount, creating heavy dilution for the unwanted buyer. The Board can redeem the rights for a nominal $0.001 each or exchange them under certain conditions. The plan is deliberately short-dated (one year) so that it does not become a permanent entrenchment device.

Why the Company Took This Step

The Board’s explicit rationale is straightforward: protect the integrity of the strategic review and ensure that any party seeking control must do so on terms that appropriately compensate all stockholders. An undisclosed accumulation—especially one involving derivatives as well as shares—creates the risk of a “creeping” position that could later be used to influence or disrupt the review process without paying a control premium. By installing a 15 % trigger and a time-limited poison pill, the Board buys itself breathing room. It forces any large buyer either to negotiate or to stay below the threshold while the review runs its course. This is a standard defensive response when management detects unusual activity that has not yet triggered public 13D or 13G filings.

What It Means for Ordinary Shareholders

For most retail and institutional holders the immediate practical impact is limited. The rights are distributed automatically; no action or payment is required. In normal circumstances the rights expire unused or are redeemed for a negligible amount. There can be temporary accounting or display quirks in brokerage accounts when the rights are declared, because the theoretical value of the rights is conceptually stripped from the common stock. This can produce large-looking unrealised losses that do not reflect the actual market price movement of the shares themselves. Those distortions typically resolve once the corporate action is fully processed. The short-term price reaction has been negative, which is common when guidance is cut and a defensive rights plan is announced simultaneously. Markets often interpret the combination as a signal of uncertainty or as management protecting itself. Liquidity can thin and volatility rise while participants digest the news.

The Medium-Term Angle: Undisclosed Accumulation

This is where the situation becomes more interesting for traders. The Board would not adopt a poison pill lightly. The reference to “significant and undisclosed accumulation” of both shares and derivative securities implies that someone has been building a position quietly—most likely through dark pools, block trades, or synthetic instruments that avoid lighting up the public tape and public ownership filings. In many historical cases, such quiet accumulation has preceded either an activist campaign or a strategic approach. When a company simultaneously opens a formal strategic review, the probability that the accumulation is related to a potential transaction rises. A successful sale or other value-unlocking outcome would typically occur at a premium to the pre-announcement price, which is the medium-term positive scenario many long-term holders hope for. Of course, accumulation alone does not guarantee a favourable outcome. The buyer could be opportunistic, the review could conclude that the standalone plan is preferable, or market conditions could deteriorate further. The weak emergency-response revenue and guidance cut remain real near-term headwinds. Possible Paths ForwardSeveral scenarios are plausible:

• The strategic review identifies a buyer or partner and a transaction is announced at a premium. The rights plan would then typically be redeemed or amended to facilitate the deal.
• No credible transaction emerges and the company continues as a standalone entity, focusing on margin recovery, bolt-on acquisitions and capital returns. The rights simply expire in August 2027.
• The accumulating party discloses a stake (via 13D or 13G) and engages constructively or confrontationally with the Board.
• Further operational softness or broader market weakness keeps pressure on the share price, testing support levels established in prior months.

From a Volume Price Analysis perspective, the key will be the character of volume on any further declines versus any subsequent recovery attempts. Low-volume drifts lower after the initial reaction would be consistent with a temporary shake-out; high-volume selling that fails to produce new lows could signal absorption by stronger hands.

Conclusion for Traders

The Onterris episode is a compact case study in modern corporate defence. A company facing operational softness and an undisclosed buyer has chosen a short-duration poison pill to protect a newly launched strategic review. The immediate market reaction has been punitive, which is typical. Yet the very existence of significant undisclosed accumulation—especially alongside a formal review—keeps open the possibility of a medium-term catalyst that many investors would view as constructive. For traders the setup is rare enough to be worth watching closely: guidance cut + strategic review + 15 % rights plan + evidence of quiet buying. The next material developments are likely to be either a formal ownership filing, further commentary from the company on the review, or a shift in the volume profile that reveals whether the larger player is still active. Until then, the stock remains a volatile instrument whose price is being driven as much by corporate-action mechanics and positioning as by the day-to-day fundamentals of environmental services. Patience, attention to volume, and awareness of the rights-plan calendar (record date 17 August) will be useful companions for anyone following the story.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis

UiPath ($PATH), Wyckoff accumulation, and Volume Price Analysis.

In financial markets, price movement is merely an effect. The true cause behind any significant market move is volume. When traders stare at a chart, they often focus entirely on price action and their favourite indicators.  However, by ignoring volume, they miss the footprints of the largest market participants: the insiders, institutional whales, and market makers.

Recently, an excellent VPA observation and question emerged from an X follower regarding the daily chart of UiPath Inc. ($PATH). The stock exhibited a massive surge in trading volume while hitting its daily 200-period moving average (200MA), followed by an aggressive, immediate pullback. The follower asked a brilliant question: Are these ‘sumo’ candles, and are we witnessing a structural accumulation phase?

The short answer is yes to both, and a further question not asked, but which is also relevant and explained below.

By applying the principles of Volume Price Analysis (VPA)—a methodology rooted in classical Wyckoffian market mechanics—we can strip away the noise. Let’s dissect exactly what happened on the $PATH daily chart, uncover the insider tactics playing out at the 200MA, and zoom out to the monthly chart to expose a textbook, multi-year, quiet Wyckoff accumulation campaign.

The Daily Chart: Dissecting ‘Sumo’ Candles at the 200MA

On the daily chart of $PATH, two distinct sessions stood out on the 20th and 21st of July. The price drifted up toward the heavily watched daily 200MA, accompanied by an absolute explosion in trading volume. Yet, despite this massive surge in trading activity, the actual price spreads remained narrow. Moreover, the candles closed well off their highs, leaving prominent upper wicks behind.

In Volume Price Analysis, we call these ‘sumo’ candles.

A sumo candle represents a localised battle of titanic proportions. Imagine an immense amount of effort being exerted, but the object itself barely moves. – much like trying to take on a Sumo wrestler. This is the Wyckoff Law of Effort vs. Result in its purest form:

• • The Effort:        Extraordinary trading volume (massive institutional orders shifting hands).
  • The Result:       A narrow price spread and an upper wick (failure to break out or sustain higher prices).

When you see massive volume coupled with a narrow spread and upper wicks, VPA tells us that the market has run directly into a wall of supply. The buying pressure, largely driven by excited retail traders, was completely absorbed by institutional sellers. The upper wicks provided an immediate, real-time clue that a near-term pullback was inevitable.

Insider Tactics: The 200MA Liquidity Sweep and Stop-Hunting Sandbox

To understand why this happened precisely at the 200MA, we have to look at the psychological mechanics of the market. The 200-period moving average is arguably one of the most widely tracked technical indicators on Wall Street. Retail traders, algorithmic bots, and casual investors view a clean break above the 200MA as the ultimate confirmation of a macro trend reversal from bearish to bullish.

Because of this universal visibility, the 200MA acts as a giant retail magnet.

As the price of $PATH approached the 200MA, retail traders got incredibly excited. They began aggressively placing buy orders to catch the anticipated breakout. Naturally, as they entered these long positions, they placed their defensive stop-loss orders in the region immediately below the breakout point or just beneath the recent swing lows.

This surge in retail excitement provides the perfect environment for institutional insiders and market makers to execute a liquidity sweep (also known as a stop-hunting exercise).

[Retail Breakout Buyers Rush In] —> Create a Massive Pool of Buy Orders
|
v
[Insiders / Market Makers] ———> Absorb Buy Orders to Fill Short Hedges
(Creates High Volume / Narrow Spread)
|
v
[Price Contained & Forced Lower] ————> Triggers Retail Stops (Liquidity Captured)

Insiders require massive liquidity to fill or hedge large positions without driving the price wildly against themselves. The flood of retail buy orders at the 200MA provided that exact counterparty liquidity. The insiders absorbed the buying momentum, capped the price, and then allowed—or engineered—the price to flush downward. This quick flush hunts the newly placed retail stops, forcing weak hands to sell back their shares at a loss, which the insiders can then re-absorb at lower prices.

Pullback vs. Reversal: Reading the Volume on the Decline

Following the sumo candles and the subsequent rejection at the 200MA, $PATH experienced an immediate downward correction. For many retail traders, this drop creates panic, leading them to believe the stock is entirely broken and headed for new lows.

However, VPA allows us to remain calm by analysing the volume profile of the decline. On the very first down candle of the pullback, the volume was notably weak. This is a glaring VPA anomaly. If a price decline is a true, structural reversal driven by aggressive institutional distribution, the volume must expand as insiders aggressively dump shares into the market. A price drop on low volume means there is no real selling pressure behind the move.

The second down candle printed on even lower, falling volume. This consecutive drop in volume completely confirms the VPA thesis: the downward move is entirely hollow. It is a temporary, tactical pullback designed to shake out weak-handed retail longs rather than a structural market reversal.

At the time of writing, $PATH has cleared the daily 200MA on good volume, validating the breakout and is now also looking to break and hold above the strong resistance at $13. However, to give us a broader perspective on what is happening, we need to look at what is happening on the monthly chart.

The Monthly Chart: Exposing the ‘Quiet Accumulation’ Campaign

To uncover the true structural intent behind any stock or instrument, we must transition from lower timeframes to the macro view. Zooming out to the monthly chart of $PATH completely unmasks the larger institutional footprint.

The first thing to note is that $PATH is a classic example of a post-hype IPO cycle. The stock went public amidst massive fanfare, peaking at an all-time high of nearly $90 in May 2021. What followed was a brutal, multi-year markdown phase as early investors distributed shares, eventually crashing the price down to a macro floor of roughly $10 in November 2022.

Since late 2022, the stock has been ‘bumping along’ this $10 level, grinding sideways for years. To the untrained eye, this chart looks incredibly boring, dead, and unappealing. To a Wyckoffian/VPA  trader, this is the most exciting phase of the market cycle: a structural accumulation base.

The definitive proof arrived in July, when the monthly volume printed a staggering 1.83 billion shares traded.

Think about that figure from a VPA perspective. Almost two billion shares changed hands in a single month, yet the monthly price candle barely moved, closing with a tight spread right at that historic $10 floor. This is the ultimate hallmark of ‘quiet’ accumulation.

Wyckoff Law of Effort vs. Result (Monthly View):
Effort: 1.83 Billion Shares Traded (July) ===> Result: Near-Zero Price Movement
Conclusion: Insiders are absorbing 100% of available supply at the $10 floor.

Insiders are aggressively and systematically buying massive blocks of shares under a strict structural ceiling. They intentionally do not chase the price higher because doing so would increase their average entry cost. Instead, they use dark pools, algorithmic iceberg orders, and localised flushes (like the daily 200MA trap) to absorb every single share available at or near $10. They are methodically transferring ownership of the company from public ‘weak hands’ to institutional ‘strong hands.’

The IPO Life Cycle: Transferring from Weak Hands to Strong Hands

One question I am often asked is whether this prolonged sideways grind is normal. And the answer is yes, this gruelling, multi-year bottoming process is highly typical of high-flying, post-hype IPOs, although not all stocks take this long to recover. For example, META took 14 months, while Tesla only took 155 days. I have done a post on SpaceX, which is facing the first major “lock-up release on the 6th August, whereby early investors can now sell their stock, which may lead to a further dump. This potential release is equivalent to 900 million shares. Elon Musk’s own shares are locked in until June 2027. See my post: SpaceX Heading Into Earnings

When a hot company first hits the public market, it is heavily marketed, overvalued, and over-allocated to retail investors at the absolute peak of the cycle (Distribution). Once the initial hype dies and the reality of the market sets in, the stock undergoes a severe markdown.

However, institutions cannot simply buy millions of shares the moment a stock hits a bottom. If they aggressively bought all at once, the lack of liquidity would drive the price up exponentially, ruining their positioning.

Therefore, the Wyckoff/VPA method dictates that a lengthy, exhausting, and boring accumulation base is required. The purpose of this phase is psychological warfare. By keeping the stock flat with occasional bouts of volatility suggesting a break higher for years, remaining retail investors become frustrated, lose hope, and eventually sell their shares just to deploy capital elsewhere. The insiders gladly buy those shares, building an immense structural position over time.

Looking Forward: Key Resistance Levels to Watch

So, where do we go from here? For that, we must consider Wyckoff’s second law of Cause and Effect, which states that the size of a future market move is directly proportional to the duration and volume of its accumulation base. $PATH has been building a massive ’cause’ since late 2022, punctuated by July’s historic 1.83 billion share intake. The potential ‘effect’ will be substantial.

However, patience is required. Before a massive mark-up phase can begin, the stock must systematically break through its overhead structural supply zones: 

The Daily 200MA: Now taken out. The $13 region, which it is testing at the time of writing, and then the $14 region where we need to see a high-volume breakout followed by a low-volume test (similar to the price action on the daily 200 ma).  The $13 & $14 ceilings become support, confirming the daily supply has cleared.

These are the macro overhead resistance zones (as shown on the monthly chart). A clean close above $14 will signal the ‘quiet accumulation’ is drawing to a close and the ‘mark-up’ phase is officially underway. For those of you who have read my book and know the story of Uncle Joe and his widgets – the warehouse has been replenished, and it’s time for the cycle to begin once again. 

However, until these structural levels break, the insiders will continue their quiet campaign—buying the dips, sweeping liquidity, and trapping impatient breakout traders at major moving averages. As volume price analysts, our job isn’t to guess when they will push the button, but to align and move in lockstep alongside their unmistakable footprints.

What are your thoughts on $PATH’s massive monthly volume spike? Are you tracking any other busted IPOs?

By Anna Coulling – creator of volume price analysis

David and I offer one-to-one coaching in the VPA methodology, and you can find all the details here: One to One Coaching Program 

By Anna Coulling – creator of volume price analysis