Trading System Signals on 10-24-2025

The markets response to economic data is interesting. September CPI was released today and was 3.0%, rising from 2.9% in August but less than the expected 3.1% so the stock market saw it as bullish. CPI is still 50% higher than the Feds target inflation rate of 2.0%. Higher inflation numbers make it more difficult to justify rate cuts. To me, it is very counterintuitive to see this as a bullish economic report. The reality is that liquidity simply wants to pile into stocks regardless of the numbers. Trends like this can change very quickly and without warning.

We have seen some good day trade trends in October. Since May, most of the gains in the Nasdaq 100 have been at night. 81% of the total net gain since May 1 has been during the evening session. In 2024, over 100% of the gains were during the night session. We saw this as bearish as the end of 2024 since the only other time the Nasdaq 100 gained more than 10% on the year and all the gains were at night was 2007. We know what happened in 2008.

The sell off at the beginning of this year made sense technically. The recovery since May 1 has been nighttime liquidity once again and we see the same lopsided pattern developing that we saw in 2024 and anticipate a technical correction. We prefer to maintain a long-short, short term algorithmic trading systems approach.

Today was a gap up and chop day. The major stock indexes made it to new highs. We have seen some nice moves in October with some equity peaks this week in the portfolios. Today, was down across the board with a sloppy and choppy session intra-day and the VIX trading down into the 16 handle.

Also, the government shutdown continues.

Hypothetical Trading System Portfolio Signals and Results:

Two System Portfolio NQ = -$1,800

50K Portfolio = -$1,423.50 on Micros, or -$612.50 when mapping Minis to Micros

Stock Index Portfolio 18 = -$8,165

Stock Index Portfolio 37 = -$8,050

Diversified Portfolio 57 = -$8,345

Silver Portfolio = -$1,050