# This Market Is Disconnected... **Date:** 2026-08-14 **Source:** [YouTube](https://www.youtube.com/watch?v=wvgNdHglQLY) ## Main Thesis The market is exhibiting a significant disconnect where equity indices are at all-time highs, yet underlying inflation risks are growing, exemplified by diesel prices making new highs while WTI crude remains sideways. While the current money flow remains bullish, there are numerous warnings, including rising margin debt and seasonal weakness, suggesting the market is ignoring potential dangers. ## Charts & Technical Analysis ### 1. Diesel vs WTI Crude Oil (None) **Bias:** BEARISH **Pattern:** Divergence The host, Thomas, highlights a major disconnect where forward contracts for diesel are making new highs while WTI crude oil is going sideways. He notes this is a visual representation of geopolitical damage and suggests it could lead to inflation shocks related to food, agriculture, and transportation, which Wall Street is not paying enough attention to. ### 2. FINRA Margin Debt (None) **Bias:** BEARISH FINRA margin debt is at new levels, which is typical for a market boom, but it is accelerating at a faster rate this time. This is presented as a sign of increasing risk and part of a larger debt problem. ### 3. Australian Property Market (None) **Bias:** BEARISH **Pattern:** Decline **Historical Comparison:** Lead-up to 'The Big Short' The Australian property market is declining, which is significant as it tends to be one of the last property markets to fall. This is seen as a potential global risk, with the host mentioning Michael Burry and 'The Big Short' as a relevant comparison. ### 4. AAII Sentiment Survey (None) **Bias:** NEUTRAL The survey shows that 38% of people are still bearish. This supports the 'wall of worry' thesis, allowing the market to continue climbing. However, if the number of bears drops in the coming weeks, it could expose the market to sentiment-driven risk. ### 5. Nasdaq % Stocks > 200-day MA (None) **Bias:** NEUTRAL **Key Levels:** 74% current level, 84% extreme level Currently, 74% of Nasdaq stocks are above their 200-day moving average, which is considered healthy. If this metric reaches extreme levels like 84%, it could signal the market has gone too far and needs to be considered alongside the negative seasonality of September and October. ### 6. Semiconductors (None) **Bias:** NEUTRAL **Pattern:** Kangaroo style recovery After falling over 20% into a technical bear market, semiconductors are experiencing a 'kangaroo style' recovery (up, down, all around). They have underperformed the broader market's move to new all-time highs. ### 7. Nvidia (NVDA) (None) **Bias:** BEARISH Michael Burry is shorting Nvidia again, viewing a recent $500 billion deal as an example of the dangers in the AI rally. The host tends to agree with Burry's sentiment but emphasizes that timing is everything and the market does not yet show weakness. ### 8. Private Equity Sector (None) **Bias:** BULLISH **Pattern:** Breakout/Rally Previously a hated sector, private equity is now moving up, driven by the narrative from the Nvidia deal. Specific examples mentioned include Blue Owl, Blackstone (rose 4.2%), and KKR (rose 3.8%). ### 9. Biotech Sector (None) **Bias:** BULLISH Biotech is highlighted as an important risk-on sector to watch. If it starts to give up its gains, it could signal a broader problem for risk-on sentiment in the market. ### 10. US Treasuries (None) **Bias:** NEUTRAL **Pattern:** Stabilizing **Historical Comparison:** Stabilizing at 2004 lows Treasuries are stabilizing at levels seen in 2004. There are volume clusters at the lows, particularly in the 7 to 10-year Treasury bonds, but no real signs of concern are coming from the bond market yet. ### 11. Crude Oil (from CTA perspective) (None) **Bias:** NEUTRAL According to Commodity Trade Advisor (CTA) positioning, crude oil is getting closer to an extreme oversold level than an extreme overbought one, suggesting it is getting lower. ### 12. Blue Owl (OWL) (None) **Bias:** BULLISH **Pattern:** Higher highs, higher lows The stock is rallying in a 'dull series of higher highs, higher lows'. This is presented as an example of the private equity narrative gaining steam. ### 13. JP Morgan (JPM) (None) **Bias:** BULLISH **Pattern:** Higher highs, higher lows Described as 'dull and bullish', the stock continues to make higher highs and higher lows, suggesting there is not much concern in the debt markets. ### 14. US Dollar (None) **Bias:** BEARISH COT reports and speculation show an extremely high number of bulls on the dollar. This contrarian indicator suggests the dollar could be about to 'go bear busting soon', though price action will be the ultimate determinant. ### 15. Energy Stocks (XLE) (None) **Bias:** BULLISH **Pattern:** Flag Energy stocks are improving, possibly due to the high price of diesel. The chart is potentially forming a flag pattern, which could lead to a breakout to new highs. ### 16. Gold (None) **Bias:** NEUTRAL **Pattern:** Pullback **Key Levels:** 4500 resistance, 4700 resistance Gold is pulling back after a very strong period where it made a new high. It has shown a couple of weak rejections and a lower low on small timeframes. Potential next equilibrium nodes are mentioned at 4,500 or 4,700. A potential support level was mentioned but the number was garbled in the transcript. ### 17. Silver (None) **Bias:** NEUTRAL Silver is in a similar situation to gold. The host mentioned potential support and resistance levels of '6150' and '70', but these figures are clearly mis-transcribed and not valid price levels for silver. ### 18. Copper (None) **Bias:** BULLISH Copper is described as 'still okay' and holding up after making a higher high the other day. This is seen as a positive sign for underlying global growth. ### 19. Semiconductors (SMH) (None) **Bias:** NEUTRAL **Key Levels:** 600 resistance The SMH ETF is grinding higher and is near a resistance level around 600, based on call option positioning. The host notes that after a large drop, markets like this need time to create structure. ### 20. Software Sector (Adobe/CRM) (None) **Bias:** BEARISH **Pattern:** Lower lows, lower highs While the broader software sector is rallying, there are stragglers like Adobe (ADBE) and CRM. These stocks are still making a series of lower lows and lower highs, though they did see a recent pickup of about 4% and are approaching resistance. ### 21. Chinese Markets (None) **Bias:** BEARISH **Pattern:** Rejection from resistance Chinese markets hit a supply level (resistance) and have since fallen. The host notes that to stop a 'freight train down', market structure is needed, and it's still early days to call a proper recovery. ### 22. SpaceX (None) **Bias:** NEUTRAL **Pattern:** Short squeeze SpaceX rallied back to its IPO price following a short squeeze. The short float was very high at 36-38%. The host suggests it could become a major options trading stock, potentially taking over from Tesla. ### 23. QQQ (Queues) (None) **Bias:** BULLISH **Pattern:** Higher highs, higher lows **Key Levels:** 730 resistance The QQQ is in an uptrend of higher highs and higher lows and is currently right around a core resistance level of 730. ### 24. S&P 500 (ES Futures) (None) **Bias:** BULLISH **Pattern:** Sideways consolidation / Pullback in time **Key Levels:** 7800 resistance The S&P 500 did a classic sideways move at core resistance of 7800. The futures market showed a series of higher highs and lows within a tight range, which the host interprets as a 'pullback in time' that resets indicators and traps shorts before a potential squeeze higher. ### 25. Bitcoin (BTC) (None) **Bias:** NEUTRAL **Pattern:** Coiling / Range-bound **Key Levels:** 62000 support, 67000 resistance Bitcoin is range-bound, trading below 67k and above 62k. This coiling action suggests an explosive move could be coming soon. There may be SEC news in the next 24 hours. ## Regime / Cycle Analysis The analysis points to a potential late-cycle environment where risks are being ignored. A key historical analog discussed is the comparison of the current AI boom (proxied by ChatGPT) to the Netscape/dot-com era, which suggests the possibility of a multi-year bull market. The host also discusses seasonality, noting the typical weakness of the September-October period, especially in a mid-term election year, which contrasts with the bullish pivot that often occurs around the election day itself. Intermarket analysis is crucial, focusing on the diesel/WTI disconnect, the role of copper as a growth indicator, and biotech as a risk-on barometer. ## Key Calls & Predictions - Warning that the sharp rise in diesel prices, disconnected from WTI, poses a significant inflation risk that the market is currently ignoring. - Pay close attention to the bond market ('bonds, bonds, bonds'); a 'freak out' there would be a major warning sign for equities. - Watch the biotech sector as a key risk-on indicator; if it starts to fail, it could signal a broader market problem. - Be aware of seasonal weakness in September-October, as historical data shows it's not a positive period for markets. - Bitcoin is 'coiling' between $62k and $67k and could experience an 'explosive' move soon. - Despite underlying risks, the prevailing money flow direction remains bullish for now, and shorting the S&P 500 during its recent sideways consolidation was not a high-probability trade. ## All Instruments Mentioned Diesel, WTI, XLE, Oil services, FINRA margin debt, Australian property market, US property market, Canadian property market, New Zealand property market, Fear and Greed Index, AAII Sentiment Survey, Nasdaq, S&P 500, Reddit, Semiconductors, Nvidia, Private Equity, Blue Owl, Blackstone, KKR, Biotech, Treasuries, 7 to 10-year Treasury bonds, Crude Oil, Gold, Credit Default Swaps, Oracle, High Yield Junk bonds, JP Morgan, US Dollar, Copper, SMH, Cospi, Software, Microsoft, Adobe, CRM, Cybersecurity, Chinese markets, SpaceX, Tesla, QQQ, S&P futures, Bitcoin --- *Generated by FX Evolution Monitor on 2026-08-14 23:00:55*