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Commitment of Traders for NDX & RUT

Commercials are short the Nasdaq 100 and long the Russell 2000.

On the Nasdaq, the hedgers’ net short is near the bottom of the chart, and the 6-month COT index is at 0. Speculators are the ones long.

On the Russell, it is the other way around: commercials are heavily long, speculators are heavily short, and both COT indexes are up near 100.

The Nasdaq is the crowded long. Small caps are the crowded short.

Could we get a rotation again, with small caps outperforming tech? Worth paying attention.

Altcoins: A Harsh Reality

If all of this is really going to fall off a cliff, even altcoins aren't likely to perform. And this could be why and is more likely why

Everyone sees alts as being in a bear market all this time

They weren't

The waves 1 and 3 were SOOOOO strong gains wise in alts. wave 5 truncated

This is why often when wave 3 extends, wave 1 and 5 match in percentage

That's also why in a diagonal, you can get a blow off top. Wave 3 in a diagonal doesn't have to be the longest and strongest

Wave 1 and 5 usually are

When its 5, if can be a blow off as 5 overshoots the trend line of 3 and 5

Any wave can extend

If this is the pattern, it means alts were in a secular bull market still, but because waves 1 and 3 did so well, wave 5 was too filled with sellers

This usually happens when the conditions turn majorly bearish. The riskiest assets fail first.

That's why alts did this. Then Bitcoin went into a bear market before stocks.

Now other things are following. Everything soon will be.

And if i

ETH Cycle Price Targets

• ETH generated a 1.3-year cycle upside target in the 3800-3900 range.
• Support for this cycle target within the next month is the corresponding FLD in the 2000 area.
• If ETH pulls back toward early Nov'26, as time cycles indicate, it can find support at that FLD without invalidating the upside target.
• Notice from the EW chart posted earlier, that the 61.8% Fibonacci retracement of the move since the June low is at about 1953, which strengthens the case for the 1.3Y cycle FLD providing support.

Topping Pattern: Yields -> Stocks -> Commodities

At the 2000 and 2007 tops, yields peaked first, stocks second, commodities third.

The logic: higher rates slow the economy, stocks feel it next, commodities last.

Today, the 10-yr yield is still making new highs. Will the pattern repeat?

Short Positioning in Russell 2000

According to what I’ve seen, IWM had $3.3B of weekly outflows, its second-largest of 2026,

Stock Market Seasonality - Part 2

· October has a bad reputation because many corrections and bear markets ended in October.

· Since 1945, a pullback of 5% or more has ended in October 33 times, more than any other month. March and September are next, at 23 each.

· Since 1950, 6 of 12 bear markets bottomed in October.

· But oftentimes corrections end in September or in early October, and the market performance in October is not that bad on average.

· Since 1950, the S&P 500 has gained about 0.8% to 1% in a typical October, and finished higher a bit more than half the time. 

· Notably, in midterm years, October is the best of the calendar. Per Stock Trader’s Almanac, the gains are about +3.0% for the S&P and +3.2% for the Dow. November is close behind, about +2.7%, and up more often.

· There is also a difference in October’s performance in bull and bear markets, as the chart below shows.

· Last but not least, November-April is the favorable period for stock market returns.

Stock Market Seasonality - Part 1

· October marks the end of the seasonally unfavorable May-October period, often referred to as “Sell in May and Go Away.”

· The chart below shows how the Dow Jones Industrial Average compares to the average of the last 25 years.

· This seasonality pattern worked well this year for DJI, small-caps, and the equal-weight S&P 500, but not so much for the cap-weighted S&P 500 and the NASDAQ 100, which are dominated by several mega-caps, including the Magnificent 7 stocks.

NDX Technical analysis:

· NDX popped up on Friday above the Keltner channel with a bearish candle.

· Was it a spinning top or inverse hammer? A close call, probably the former.

· NDX should eventually visit the mid and bottom Keltner channels.

· Notice short- and long-term negative divergences in RSI and the Bullish Percentage Index; the latter looks really bad.

HACK/SOXX 195m BB squeeze

Everyone remains focused on semis but I continue to think that cybersecurity is about to dramatically outperform. This ratio has continuously failed to make a lower low as the 0.2046 level holds as support. This looks like a strong base building here, ready for the big breakout potentially.

Now that the authorities are issuing subpoeanas and regulatory inquiries into OpenAI et al, there is likely to be increasing scrutiny on cybersecurity protocol for autonomous AI agent implementation. That is a massive tailwind for cybersecurity from a fundamental persepctive. And the technicals support that interpretation too imho.

HACK is on the verge of breaking above the ATR EMA multiple DTL finally. Patience will be rewarded here.

NDX has shown relative strength compared to SPX, DJI, and RUT.

Its internals have been stabilizing and even improving over the past two weeks.

Does that mean the green path A is more likely? Not necessarily, in my opinion.

DIS EW Update

• Approaching the target region, ideally 99 +/-