The 90-Second Read
AI bid vs. rate fear
- Tuesday gave back a slice The S&P 500 fell 0.38% to 7,520.93 after Monday's surge, the Dow slipped 0.30% to 52,231.89, the Nasdaq Composite lost 0.74% to 25,065.87 and the Russell 2000 lost 0.68% to 2,821.38. The fear gauge still eased, to 19.46.
- Inflation ran hot October consumer prices rose 0.4% for the month after 0.6% in September, and core rose 0.3% for a third straight month. Energy rose 0.7% and food 0.5%. There is no year-over-year figure this month: the Labor Department could not publish 12-month changes because October 2025 prices were never collected during last year's funding lapse.
- The Fed talk turned to size Governor Christopher Waller said he is leaning toward a quarter-point increase in December and that a half point "should be considered." Dallas Fed President Lorie Logan said the committee needs at least two more quarter-point increases before a pause. The full read is in Section 10.
- Rates backed up hard The 10-year yield rose 10 basis points on Tuesday, and the $42B 10-year auction cleared at a high yield of 5.020% with a bid-to-cover of 2.46. The bond market is closed today, so the rate signal is frozen until Thursday.
- CoreWeave flips the chip tape CoreWeave reported third-quarter revenue of $3,661M, against $1,365M a year ago, and raised its full-year revenue guide to $13.0B to $13.3B. The stock indicates about 14% higher, Nvidia indicates about 5% higher after Tuesday's 5.47% drop, and Micron is bid with them.
- Holiday liquidity No U.S. data and no Fed speakers are scheduled, and Treasury trading is shut. Equity index futures carry the entire macro read today, which can make a thin overnight move look more decisive than it is.
- Levels into the open A public dealer-gamma (GEX) model puts the put wall at 7,500, the call wall at 7,700 and the gamma flip at 7,907.42, with cash closing in negative gamma. ES Dec carries a 23.32 premium to cash, so the walls sit near 7,523 and 7,723 in ES, and today's SPX expiration has max pain at 7,545.
The Scoreboard
| Instrument | Level | Change | Session |
|---|---|---|---|
| S&P 500Monday close 7,549.94 | 7,520.93 | −0.38% | Tue close |
| Dow Jones IndustrialsMonday close 52,389.75 | 52,231.89 | −0.30% | Tue close |
| Nasdaq CompositeMonday close 25,253.14 | 25,065.87 | −0.74% | Tue close |
| Russell 2000Monday close 2,840.81 | 2,821.38 | −0.68% | Tue close |
| ES Dec 26Tuesday settle 7,544.25 | 7,604.75 | +0.80% | 5:54 AM ET |
| NQ Dec 26Tuesday settle 27,835.25 | 28,347.00 | +1.84% | 5:54 AM ET |
| Dow futures (YM Dec 26)Tuesday settle 52,315 | 52,322 | +0.01% | 5:54 AM ET |
| Russell futures (RTY Dec 26)Tuesday settle 2,828.90 | 2,844.50 | +0.55% | 5:54 AM ET |
| WTI Dec 26Tuesday settle 86.04 | 87.06 | +1.19% | 5:53 AM ET |
| Brent Jan 27Tuesday settle 91.49 | 93.25 | +1.92% | 5:53 AM ET |
| Gold Dec 26Tuesday settle 4,030.20 | 4,057.10 | +0.67% | 5:53 AM ET |
| US 10-yearTreasury yield · Monday 4.88% | 4.98% | — | Tue close |
| NvidiaMonday close 178.67 | 168.89 | −5.47% | Tue close |
| MicronMonday close 733.15 | 725.11 | −1.10% | Tue close |
| CoreWeaveMonday close 48.98 | 48.73 | −0.51% | Tue close |
Rows with a clock time are overnight reads measured against Tuesday's session settlements. Cash index, Treasury and single-stock rows are Tuesday's closes; the premarket indications for the single names are described in Section 9.
Sentiment & Flow Gauges
| Gauge | Reading | Read |
|---|---|---|
| VIXMonday close 19.92 | 19.46 | EASING The fear gauge slipped back under 20 even on a down day for stocks. |
| Cboe put/callTotal · equity-only · prior session | 0.95 · 0.77 | BALANCED Index and SPX-family hedging ran heavier than single-stock hedging, at 1.02 and 1.11. |
| Fear & Greed5:34 AM ET | 33.86 | FEAR Close to a week ago at 34.17 and well below the 43.51 of a month ago. |
| AAII bearish shareWeek of Nov 4 · latest survey | 48.4% | BEARS LEAD Bulls were 34.1%; the next survey prints Thursday and is the first to capture this week's swings. |
| S&P 500 new highs / lows52-week · prior session | 28 / 3 | BROAD Highs kept leading lows even as the index fell. |
| S&P 500 above 200-dayprior session | 62.7% | HEALTHY Long-term participation held its Monday level. |
| S&P 500 up / down volumeprior session | 41% up | MIXED Sellers had the edge in volume without a washout. |
| High-yield spreadICE BofA HY OAS · Nov 9 | 3.34% · −9bp w/w | STABLE Credit stayed calm through the equity correction and the rate scare. |
Flow Read
Tuesday's decline was narrow in the way that matters: the index lost ground on its largest names while new highs still outnumbered new lows and the share of members above their 200-day average held. None of the four breadth conditions fired. That pattern reads as an index problem concentrated in a few heavyweights rather than a market-wide liquidation, which is also why the Nvidia and CoreWeave tape matters more this morning than the inflation print did.
Yesterday's Calls Graded
Calendar & Scenario Map
| Time ET | Event | Consensus | Prior |
|---|---|---|---|
| Wed | Veterans Day: no U.S. data releases or Fed speakers; the bond market is closed, stocks and equity futures trade | — | — |
| Thu 8:30 | Weekly jobless claims | — | 189K |
| Thu 9:00 | Cleveland Fed President Hammack speaks | — | — |
| Thu 10:00 | Existing home sales, October | — | 4.0M |
| Thu 10:00 | Fed Governor Barr speaks on artificial intelligence | — | — |
| Thu | Treasury bill settlement, with bills in net issuance | — | — |
| Thu 12:00 | Weekly petroleum status report, moved for the holiday | — | — |
| Thu 1:00 PM | 30-year Treasury bond auction, $25B | — | — |
| Thu 1:10 PM | San Francisco Fed President Daly speaks | — | — |
| Thu 2:00 PM | Monthly Treasury balance, October | — | −$27B |
| Thu 4:30 PM | Fed balance sheet (H.4.1) | — | — |
| Thu after close | Cisco and Applied Materials report | — | — |
| Thu 6:30 PM | New York Fed President Williams speaks | — | — |
| Fri 8:30 | Producer price index, October | — | 1.3% |
| Fri 8:30 | Core PPI (ex food and energy), October, month over month | — | 0.7% |
| Fri 8:30 | PPI, October, year over year | — | 6.3% |
| Fri 12:00 | San Francisco Fed President Daly speaks | — | — |
Prior figures are shown where the calendar carries them; consensus is left blank where no first-hand estimate was available.
Pivot Points & Gamma Map
| Gamma level | SPX | ES Dec · +23.32 | Role in today's tape |
|---|---|---|---|
| Gamma flip | 7,907.42 | 7,931 | The regime boundary, 386.49 points above cash and above the call wall itself. Below it dealer hedging travels with price; that is not a line one session reaches. |
| Call wall | 7,700.00 | 7,723 | Ceiling, 179.07 points above cash. The largest call open interest above the market in the November 20 chain sits at the same strike, 31,353 contracts. |
| Max pain | 7,545.00 | 7,568 | Today's expiration magnet, 24.07 points above cash. A live reading that shifts with open interest; near the money it marks a zone, not a point. |
| Put wall | 7,500.00 | 7,523 | Floor, 20.93 points under cash, with 39,865 puts at the strike, the largest put open interest below the market in the November 20 chain. In negative gamma a break under the floor has tended to accelerate rather than stall. |
Other weight in the November 20 chain: the 7,400 put shelf at 24,378 contracts, 7,600 with 21,781 puts and 14,130 calls, and put open interest that is still heavy at 7,300, 15,604 contracts, where the strike window used here ends, so the lower shelf may extend further down. Cannon's ES Dec levels put the pivot at 7,546.75, first resistance at 7,600.50 and first support at 7,494.75.
The near-dated chain tells today's story. In the ES weekly that expires this afternoon, the largest call open interest above the market is 3,127 contracts at 7,700, the same strike as the monthly call wall, and the largest put open interest below it is 4,089 contracts at 7,400, with 2,874 at 7,375. With ES trading near 7,605, both near-dated walls sit about a hundred points away, which leaves the session's pin to Cannon's resistance ladder rather than to the options.
Institutional Positioning
Yardeni's Tuesday note is titled "Fed Likely To Hike By 50bps In December." He reminded clients that in late October he warned the Fed could surprise with a quarter-point hike, and that if it passed because the midterm elections were too close, he expected a half-point move in December. On his own feed he wrote that the Fed "held rates steady in October despite robust growth, strong labor markets, and inflation above target," and that two members wanted a hike anyway.
The rate call is the change; his equity view is not. His standing S&P 500 target for the end of 2026 remains 7,900, which puts him among the strategists who see a hawkish Fed and a higher index as compatible.
Lee took the other side of the rate argument on Tuesday night. His firm's video note says that despite higher October core inflation, "a Fed hike in Dec is arguably still a mistake given higher rates = more housing shortage = inflationary." On his own feed he endorsed the view that the overshoot came from transportation services and energy rather than a broad acceleration, adding to his call from Monday that the bottom is in. He gave no new index level.
Desk Shift Tracker
| Voice | Stance | What moved |
|---|---|---|
| Ed YardeniYardeni Research | HAWKISH FED | Now expects a half-point hike in December; equity target unchanged. |
| Tom LeeFundstrat | CONSTRUCTIVE | Calls a December hike a mistake and reads the CPI overshoot as energy-driven. |
| Mark NewtonFundstrat | CAUTIOUS | Sees "no exhaustion, no capitulation" yet, and suspects a push to new lows could mark opportunity into mid-November. |
| David KellerSierra Alpha Research | CAUTIOUS | Welcomed the fear gauge back under 20 but flagged the S&P 500 still under his critical 7,600 level, with Nvidia breaking down. |
| Keith ParkerUBS | CONSTRUCTIVE | Kept his year-ahead targets and argued the de-rating sets up stronger returns, preferring semiconductors over hardware. |
| Sherry PaulMorgan Stanley Private Wealth | DEFENSIVE | "Right now, I think stay in large caps." |
| James TaylorTaylor Group, Wells Fargo Advisors | CONSTRUCTIVE | Not worried about Nvidia long term despite the governance story. |
Macro Pressure Map
| Driver | Reading | Read |
|---|---|---|
| Net liquidityFed balance sheet − TGA − RRP · Wednesday levels · updates Thu | $5.81T · ▲ $82B w/w | ADDING Unchanged since last week's release; the next reading lands Thursday at 4:30 PM. |
| InflationOctober CPI · month over month | 0.4% · core 0.3% | STICKY Shelter rose 0.3% and accounted for more than 30% of the monthly increase; energy and food both firmed. |
| Treasury supply10-year auction · high yield | 5.020% | HEAVY The auction cleared above where the 10-year closed; the 30-year follows Thursday at 1:00 PM. |
| GoldDec · Tuesday session · overnight in the Scoreboard | −2.67% Tue | REBOUNDING Gold took the rate scare hardest on Tuesday and is recovering a part of it overnight. |
Portfolio Positioning
| Name | The story |
|---|---|
| CoreWeave | Third-quarter revenue of $3,661M, a net loss of $709M, adjusted EBITDA of $2,256M and a backlog of about $132.5B. The company raised its full-year revenue guide to $13.0B to $13.3B and set capital spending at $37B to $39B. Chief executive Michael Intrator called it "a breakout quarter." The stock indicates about 14% above Tuesday's close. |
| Nvidia | The stock fell 5.47% on Tuesday to 168.89, a second straight drop as the board investigates its chief executive, Jensen Huang. It indicates about 5% higher this morning, riding CoreWeave's numbers rather than any resolution of the governance story. |
| Micron | Micron closed down 1.10% at 725.11 and trades higher premarket as memory names take CoreWeave's capacity build as a demand signal. |
| Anthropic | The company launched its IPO roadshow for 825,000,000 Class A shares at $70.00 to $78.00, to list on the Nasdaq Global Select Market under ANT. Plexo Capital's Lo Toney said he is "very bullish on Anthropic." No pricing date has been set by the company. |
Fed Watch
The federal funds target sits at 3.75% to 4.00% after the Fed held in October, and Tuesday moved the December debate from whether to hike to how much. Waller, speaking in London, said "further tightening of monetary policy will be needed, sooner rather than later," that he is "leaning toward supporting an increase in our policy rate of 25 basis points" in December, and that "a 50 basis point hike in the policy rate should be considered." He said he is "particularly concerned about the breadth of price increases."
Logan went further on the path: "the FOMC needs to implement at least two more 25-basis-point rate increases," after which she would pause. Philadelphia Fed President Anna Paulson said policy "needs to be somewhat restrictive" and that "there is likely more work to do." Vice Chair Bowman also spoke on inflation and risks on Tuesday. Today is quiet; Thursday brings Hammack at 9:00, Barr at 10:00, Daly at 1:10 PM and Williams at 6:30 PM, and Daly speaks again Friday after producer prices.
What the Consensus Is Missing
The rate story stops trading today; the AI story does not
With the bond market shut, the overnight bid is being priced without a live Treasury market to argue with it. Tuesday's backup in yields has not been tested by a second session, and Thursday brings the bond market back at the same moment as a 30-year auction and the Fed's busiest speaker day of the week.
The doves are now arguing against a hike, not for a cut
The most constructive voice on the Fed this week is calling a December hike a mistake. The debate inside the Fed has narrowed to a quarter point or a half, and nobody on the record is making the case for holding, which leaves the market's relief rallies dependent on earnings and AI spending rather than on rates.
Breadth is better than the index
Tuesday's loss came with highs still leading lows and long-term participation intact. A market that is weak at the top and steady underneath is the opposite of the late-cycle pattern bears are looking for, and it means the index's next move rides heavily on whether the largest chip names hold today's bounce.
eli@cannontrading.com · cannontrading.com
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