Yahoo Finance

Well, US stocks close higher to end of volatile week with the S&P 500 posting its best week since 2023. Yahoo finances Jared Blickry joins us now with the trading day takeaways. Jared.

Thank you, Josh. Uh, you're going to have to forgive me if I put best in scare quotes there. We have had some historic market moves this week, and we're going to talk a lot about volatility, but I just want to go down some of the market moves that we saw. I'll start with the bond market. So, we had the biggest increase in yields. This is a 10-year yield since 2001 this week. And then if you look at the 30-year biggest since 1982. So, that's basically before any investor here was really doing their thing. So, we've just had to deal with a lot of new information, and then yes, we had some historic drops and we also had some historic gains. What I found really interesting in the S&P 500 is that the last four days, either uh, 85% of all the issues have been going up, or they've been going down. And so, first we went down, then we went up, then we went down, then we went up again. And so you're wondering why uh, we feel a little bit shellshocked here and are not celebrating this best week and however many years, that is why, my friend.

Yeah.

Massive.

Yeah.

Mhm.

Mhm.

So, volatility was up this week, Jared? Or would it depend how I look at it?

Exactly. It depends how you look at it. Because the VIX and I can chart this, the VIX actually dropped, it jumped up to 60, and then it had a net decline from the previous week. Uh, that's implied volatility. However, what I was just talking about is actual volatility. This is a five-day price action in the S&P 500, this is realized volatility. So, just to round out the discussion here, let me take a look at the VIX, and you can see over the last five days, we started out at 60, ended up at 37, but that is still pretty elevated historically speaking. Also have a couple more charts want to show you real quickly here. Uh, this is going back to 1980, and this is um, so, this is a four-week trading range and right now, we are about seven and a half percent. So, that means over the last four weeks, the weekly range has averaged seven and a half percent. You're going to see as I draw this line across, we've been here before, but it's not exactly an extreme. We saw a bigger extreme in the pandemic, in the global financial crisis, 87 crash, and so, we are not at the tipping point yet for this full-blown bear market. And I extended the analysis even further. This goes back to the Great Depression and this is plotting only those moves over 3% and under 3% to cut out the noise in the middle there. And you can see in the Great Depression, we had a lot of volatile days. Then we kind of cooled off for a few decades, then in the 1980s when we had uh, the recent, the first bull market in quite a long time, we saw a bunch of volatility there, then the dot-com boom and bust, then we saw the global financial crisis, then the pandemic. And here is where we are right now. We had this huge upside day, that was when the S&P was up, what? 8%, something like that, Nasdaq up 12%, we haven't had these huge down days uh, that match the pandemic, but my thesis is, if we move below 4,800 in the S&P 500, we're going to get some more of those.

Mhm.

Finally, any uncertainty hedges to talk about?

Oh! Guess what? Gold. Gold now up to about $2,500 an ounce. Let's just chart, let's chart it so we can get the actual prices. Um, gold got uh, sold off. It was kind of like a baby with the bathwater situation. So, it had a nasty few days, but it has roared back. The last three days it has been up 2% each of those days, it is up 10% this week, 10.2%. And let me put a one-year chart on, so you can see. Gold has just been a pretty steady provider of returns over the last year and it has really accelerated. It just had its best week since the pandemic, that is the second-best week this century. So, all eyes on gold right now.

Yeah.

Yeah.

Mhm.

Finally, we're into the weekend. Bitcoin?

Oh! Yeah, we got to check out Bitcoin as well. Bitcoin not soaring as much as gold, but it also didn't do as badly as stocks when we were getting those huge selloff days. So, let's just part uh, chart the price action in Bitcoin, this is over the last year and it's interesting. You can see that we kind of had this top in here, we fell off, and we've been uh, kind of trying to find a bottom here, but we didn't go that far, we didn't go as far as I thought we would. We're camping out above 80,000, I said 70 to 72,000 is my price target down here, we hit about 74, 75. So, we could see some more downside in Bitcoin if we get that huge selloff in equities, but for the most part, Bitcoin has been held holding up better than a lot of other risk markets.