Yo Pit Crazies!

Turns out the best thing Congress did during the shutdown was absolutely nothing… and the market loved them for it.

SPY just jumped to a two-week high, and traders are grinning like they found money in their old jeans. 

The NASDAQ was booming, oil stocks made a nice comeback, and suddenly everyone’s dusting off their Santa hats for the potential rally from Thanksgiving to Christmas.

But here’s what really happened during those 40 days of political theater: While senators haggled and pointed fingers, the shutdown exposed exactly how much government money was flowing to places most people had no clue about.

No new laws, no fresh congressional spending sprees, and markets ate it up like candy.

This “crisis” everyone panicked about? Markets are celebrating it like Christmas morning.

Eight senators finally crossed the line this weekend, voting for the continuing resolution. 

The result? No ACA subsidies, no SNAP benefits for illegal immigrants, basically nothing on the Democratic wish list except an agreement to maybe discuss ACA subsidies later.

A shootout at the OK Corral this was not.

Meanwhile, SPY climbed about 20 points from Friday’s lows, proving that sometimes the best government is the one that stays out of the way. 

Trading was bullish across the board, and you could feel the optimism building for what’s coming next.

 What Bugs Me About This Rally

There was one troubling sign that caught my attention: gold continuing its climb back toward yearly highs.

Why the gold love? Trump’s floating the idea of $2,000 stimulus checks funded by tariff revenue. Now, I think this might be a clever Supreme Court play: once you send Americans $2,000 checks, good luck asking for them back when the Court reviews tariff rules.

Smart politics? Maybe. But it’s also inflationary as hell, and the last thing the US needs right now is more money printing when we should be focused on not spending money we don’t have.

Here’s what I really want to see for this rally to reach dizzying heights: VIX needs to drop to two-week lows. It’s heading in the right direction, down about four points from Friday’s highs, but it’s not quite there yet.

To be honest, I’m a little surprised we didn’t see a lower VIX number today. Heck, we didn’t even hit a one-week low.

That tells me traders are still hedging hard. Markets are up, everyone’s happy, but they’re expecting higher volatility in the near term. Which is… surprising, considering how well things are moving.

The trend I want to see more of, especially for our rally to hit those moonshot levels, is volatility dropping while SPY keeps climbing. We’re getting there, but VIX is being stubborn about giving up its anti-SPY role.

Essentially, we’re waiting for Congress to finish their job, officially reopen the government, and disappear on recess so they can’t mess anything up. Then we’ll see what they actually plan to do in 2026.

For now, though, if you want to capitalize on these NASDAQ moonshots that have been lighting up screens all year, Hans is going live Tuesday to break down exactly how he catches them.

Because while Congress was busy doing nothing, some traders were busy doing everything right.

To your investing success,

AG