Today’s Market Update: Election Day, Crypto Support, and a New Question for the Magnet Strategy
We are heading into Election Day with markets trying to price several things at once: political gridlock, weaker growth, falling yields, continued pressure in crypto, and the possibility that we are finally reaching some of the retracement levels we have been waiting for.
On the political side, markets appear to be pricing a strong chance of Democrats taking the House and possibly the Senate.
My expectation remains that the immediate market impact of that would probably be gridlock.
Congress would become much less able to pass new policy, tariffs could face more resistance, and the administration would have fewer opportunities to make large unilateral changes without a fight.
That is generally something Wall Street likes.
It does not mean government suddenly becomes functional. I actually expect more shutdowns, investigations, subpoenas, legal fights and constitutional confrontations.
But from a market perspective, gridlock can reduce policy risk, which is one reason I still think we could see another meaningful equity rally.
The Dollar Still Looks Weak
The DXY continues to behave roughly as expected.
Despite repeated calls for a major dollar breakout, it has not run away. I still see the larger near-term trajectory as lower before the eventual recession-driven flight-to-safety move higher.
Oil also sold off again on another round of Iran-deal headlines.
I remain skeptical of those headlines, but the market continues reacting to them.
Gold and Silver Are Bouncing — But I’m Still Not Buying
Gold and silver are finally bouncing after becoming deeply oversold.
But I do not see that as evidence that the larger correction is finished.
Gold has sold off relentlessly, broken below the 365-day moving average, and reached a significant support area. A bounce from here makes perfect technical sense.
Silver is even more oversold, with RSI below 30 and price hitting major historical support.
But my long-term accumulation targets remain much lower.
For silver, I am increasingly interested closer to roughly $37–$40.
For gold, I still want something closer to a full return to sender before I become aggressive.
TLT and Treasuries Continue to Work
I remain very comfortable with my Treasury positioning.
The TLT buy area was roughly $76–$78, and we are now around $81.
I could see TLT moving toward $83–$84, but I still do not think the larger breakout has begun. I expect another pullback before the eventual recession trade.
The bigger win so far has been moving out of three- and six-month Treasuries and into the 5- and 10-year when yields were above 5%.
Those positions have appreciated while still paying attractive yields.
Bitcoin: I’m Still Accumulating
My crypto plan has not changed.
Bitcoin remains the strongest of the major coins, and Bitcoin dominance is still above 60%.
I currently have one long position from approximately $77,200, originally entered near the 365-day moving average.
My next planned buy is around the 50-week moving average, which is converging with the 50% Fibonacci retracement near $75K.
Below that, my final major buy area remains around $73K, near the rising 200-day moving average.
The Golden Pocket is around $72K.
I still expect total crypto market cap to complete its 50% retracement around roughly $2.54 trillion, and from there I think a rebound becomes increasingly likely.
If Bitcoin completes that retracement, I could easily see a bounce back toward approximately $81K.
At that point, I may even take profits on some longs and potentially short the move again if I still believe the larger retracement is unfinished.
Ethereum and Solana Are Weaker
Ethereum has already retraced much further than Bitcoin and is sitting near its 50% retracement.
Solana remains the weakest chart.
It has broken through several major support levels and is now near the bottom of its Golden Pocket.
The important line for Solana is the 200-day moving average.
If Solana begins closing below that level repeatedly—not just wicking through it—that would become much more bearish.
For now, that is not my base case.
The Magnet Strategy’s First Time-Based Exit
The most interesting development in the Crypto Magnet strategy was its first time-based exit.
The BTC short entered around $77,058 and had a normal price stop much higher.
But the strategy also had a maximum three-day holding period.
When that 72-hour window expired, the system automatically closed the trade around $78,057, creating a loss.
The frustrating part is that Bitcoin later fell below the original entry and the trade would have become profitable had we simply allowed it to remain open.
That raises an important question:
Are our time-based exits too restrictive?
Most Magnet trades complete very quickly—often the same day or within one or two days—so this is the first time we have really seen the time stop become relevant.
We do not have enough data yet to change anything.
But when we do our next optimization review, I want to test whether removing time-based exits entirely, or extending the window beyond three days, improves the historical and forward results.
Bottom Line
The overall framework remains intact.
I still expect political gridlock to be relatively supportive for equities, the dollar remains on the expected near-term path, and my Treasury positioning continues to work.
Gold and silver are bouncing from oversold conditions, but I still think better long-term accumulation prices are ahead.
In crypto, I am continuing to accumulate into support rather than panic into weakness.
Bitcoin remains stronger than Ethereum and Solana, and my next major buy areas remain approximately $75K and $73K.
Meanwhile, the Magnet strategy has given us another useful piece of forward data.
Its first time-based exit may have cost us a winning trade.
That does not mean the rule is wrong.
But it gives us something specific to test when we begin the next optimization pass.
