Video summary
The Tom O'Brien Show opens with a significant analysis of the recent economic data, specifically focusing on a surprisingly hot Consumer Price Index (CPI) print that has heavily influenced market expectations for the Federal Reserve. The core monthly CPI for August came in at 3%, far exceeding the anticipated 0.2%, which has shifted the probability of an interest rate hike on September 16th to approximately 86%. Despite this hawkish data and rising yields pushing the ten-year Treasury note close to 5%, equity markets have shown resilience, with the S&P up nearly 9% and gold trading around $4,392 after an initial spike. The host notes a divergence in market behavior where equities are not selling off despite the inflationary pressure, while the dollar index struggles to find a bid even as yields accelerate, suggesting that the Federal Reserve may eventually need to intervene with tools to manage currency volatility if yields continue their upward trajectory.
In the commodities sector, the show highlights distinct volume patterns between equity indices and physical metals during this short trading week. The GDX semiconductor index experienced a pullback on lighter volume compared to the heavy selling seen in prior weeks, indicating that no one is actively trying to dump equities at these levels. Conversely, the metals market has seen decent volume averaging around 200,000 contracts per day, with gold and silver showing some pickup after recent declines. Copper also made headlines by reaching an all-time high of $6.89 before pulling back slightly, a move attributed to profit-taking following its rapid ascent from $74 to over $100 in just 38 days. The host points out that while copper stocks like Freeport and Southern Copper are reacting to these price movements, the broader market sentiment remains risk-on, evidenced by the VIX dropping to near lows despite the looming rate hike.
Beyond the technical analysis of markets, the broadcast takes a reflective turn as the host commemorates the 25th anniversary of the September 11 attacks, sharing a personal memory of walking through the halls of Villanova University during that tragic time in 2001. He emphasizes the preciousness of life and the importance of living in the present moment, noting how quickly time seems to fly as one ages. This philosophical interlude serves as a reminder to enjoy every day and own the present rather than dwelling on the past or worrying excessively about the future. The host concludes by encouraging viewers to spend their weekend wisely and safely before returning for more market insights on Monday morning, wrapping up a session that balanced hard economic data with a poignant message about time and life.
Read the full video transcript
The following is a presentation of TFN.
The Tom O'Brien Show is produced every
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>> Now Tom O'Brien.
>> Good Friday afternoon everybody. Tommy
O'Brien coming to you live from TFN.
Thanks for kicking off the final hour of
the trading week with me on the Tom
O'Brien Show. Boom. We kick things off.
Quite a CPI Friday. So, we get a print
this morning and the market a little bit
of a story of sell the rumor, buy the
news, as in we get a CPI print, folks.
Why not we kick it off with a headline?
Okay, that yeah, you get a hot CPI. The
Fed meets in 5 days. And the number that
was most important was the core monthly
CPI this morning. And that number which
excludes food and energy came in at 3%
for the month. The expectation was 0.2%.
Okay? And that's for the month of
August. And that's a hot number. And
right now you're talking about a Fed
where they're talking about talking
about they're pricing in right now the
expectations for a hike. Yeah. How about
it? Remember we were saying earlier in
the week that we were at about a 50/50
and by Friday morning this was going to
be heavily tilted in one way or the
other. It's a hike, folks. 86%
probability right now priced into swaps
that the Fed's going to hike September
16th. So that's the backdrop, but pretty
remarkably
you jump over to yields. Now things have
reverberated, but you do go a little bit
lower price, higher yield, but this
market gave it back initially. Now we
have crude complicating the scenario
right now. Okay, crude hits 104 last
night. You come into that 830 number at
99. We're back above 100 right now, but
you got a yield right now in the 10ear.
Let's pull it up exactly. I think we're
pushing about 4.93.
What are we at? No, 4.97. No, four. We
just ticked to 4.98.
We might hit 5% by the time I get off
the air, folks. Your 10ear sit at 4.98
right now. You jump over the dollar
index 9911. All things considered, still
can't catch any type of a remarkable
bid. Okay, with what's happening with
yields right now, the dollar should be
much stronger.
But no one wants dollars right now. Even
in the face of a 5% tenure, you jump
over to gold.
Initially on a hot CPI print, you hit
gold spike to lows of 4333.
You trade up more than $100 to 440, but
it's given back some of those gains.
Gold trading at 4392. You got the GDX,
GDX positive today. Up by 70 pennies,
but taken on the chin yesterday. A lot
of this got priced in yesterday, folks.
Market digesting that CPI print. S&Ps up
9/10%. We're coming back talking
equities, folks. Be right back.
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Welcome back, folks. We take a look at
the metals GDX right now. So, GDX, I
mean, check out the pullback. Now, we
have a short trading week. Okay, markets
closed on Monday, but if we're going to
get a pullback, that's the type of
volume I want to see on the pullback.
Okay, no one is selling the equities
right now, folks. Now, you dip down to
9562. We're at 9678. But look at the
volume. 60 million shares on the GDX,
you're at 120 million and 130 million
and 150 million in prior weeks.
Okay? Even if you extrapolate that out
to five trading days, not even close to
the type of volume. So, you trade higher
on quality volume, you pull back on
lighter volume. Now, the metals, a
little bit of a different story,
okay? Okay, cuz we had some volume on
the last couple weeks and you're going
to have a little volume this week too in
terms of you take a look at these four
days, you're talking about 180 today,
200 yesterday,
214 and 160. So you're almost averaging
200,000. So you're going to come in at
760 800,000 on the week on gold
and that's over four trading days coming
into 9:15. And so it's decent volume on
this pullback on the metals, but not on
the equities. And we'll see if that
divergence continues. You jump over to
silver.
Yeah, not quite as pronounced the last
couple weeks. Light volume,
excuse me.
Yeah, look at the volume in platinum as
well. So, a little bit of a pickup in
some of the metals.
jump over to copper after reaching
all-time highs. A little bit of pullback
in copper and yeah, that's something to
watch as well as copper hits an all-time
high at 689.
And on a short trading week, copper
trades lower with 260,000 contracts and
that's because of yesterday. Look at
that move, man. Copper ripping lower
with volume.
Jump over some of the copper stocks.
Southern crop are off about half a
percent right now. Freeport flat
and yeah. So, Mr. Walsh,
as you come into next Wednesday,
tensions rising as he faces the pan,
man. He's in the pan. He's heating up.
And we'll see what he comes with on
Wednesday. But right now, you know, this
market would be shocked if he didn't
hike.
And he's kind of led the way with some
of that expectations. Even Waller
putting out there with inflation data.
And now we get a hot inflation print.
And yields in focus, man.
As you look at yields,
we don't have the volume this week. It's
going to be a big one, though.
And the more decisive fact is that
we're trying to break away from an area
that's been an area of support going
back to 2024, 2025, even the brief
bounce we got in July.
And yeah, on 911 folks, 25 years, man,
time is crazy, right? 25 years. Was
talking about this morning, I remember
exactly where I was. I was in a certain
hall of Villanova and I had to walk
through the 9/11
2001. I graduated Villanova in 2002 was
my senior year and I was walking through
the hallways for a class that I had
between about 9 and 10:00. And you know,
you remember the people that died that
day,
the survivors and first responders,
right? The people cleaning that site up,
57,000 members having had a certified
cancer diagnosis. You know, you got some
of the news, and I haven't gone through
the documents, but in terms of
trying to hide the air quality and and
all of that, but you remember those
people and life is precious, folks.
enjoy every day and and yeah, that that
talk about transforming things.
25 years, man. Time just keeps flying. I
was literally watching the seconds tick
off on my Thinker Swim platform
yesterday. And I tell you folks, I feel
like literally the way that I watch a
clock move is speeding up. The way I
watch seconds tick off the clock. I was
saying to myself, is this Thinker Swim
clock like catching up from a delay? No,
that is how fast seconds move. And uh
hey, I digress. But coming into a
weekend, folks, you know, enjoy your
time, right? My dad would say,
"Yesterday's gone. Tomorrow's not here.
What are you doing right now, right?
Whatever you want in life, folks,
think about it. Step into it. Own it."
And and that's the truth. And you know,
the more days you live, the more you
know that's the truth. Enjoy every day
out there, folks, because boy, 25 years,
like a heartbeat. I feel like going back
to college, senior year at Villanova,
baby.
It's a couple lifetimes ago. It feels
like. All right, we jump over the
dollar. So, here's a weekly of the
dollar. You look at the action we've had
since the war kicked up. Okay, and
there's where the war started. Dollar
came into the war about 98.
Look at how hard it's been for the
dollar to find a sustained bid when you
compare that chart to this chart, which
is yields just accelerating higher,
right? You got a brief bid back in May.
And yields aren't just going to go up
forever, folks. Okay? Yes, that is the
trade right now. And it's not stopping
just yet. And it seems like we're
destined to hit 5% on the 10-year, but
Treasury's got some tools in their
disposal. they've been shown that they
want to use. And at some point, we're
going to catch a little volatility here.
And when we do,
when you get a break in yields
eventually, that could be when you
finally get a move lower in the dollar
cuz the dollar cannot trade higher right
now. Even though yields just keep
persisting. So, what happens when yields
don't persist, right? What happens when
crude's not trading from
$70 to $100 in 60 days? Not trading from
$74 to $100 in 38 days, right?
Pressure's all men to the upside right
now. And even with that pressure,
even with yields pushing 5%, right?
Dollar can't find a bid and gold still
pushing 4,400 right now. Now, gold
started the war though
in a little goldilock scenario, man.
Gold started that war at 52.89, folks.
52.89.
Okay. Yeah. So, we're down about $900
since the start of the war. Yields up
almost a full percentage point.
But longer term, this dollar can't find
a bid.
And no matter what happens with yields,
okay, dollar can't find a bid. And I
imagine that you're going to see
Treasury going in on a constant updating
schedule to try and up the ante,
especially if we start pushing where we
are right now because they were already
coming in, right? Treasury Secretary is
no fool. He was looking at the lower
boundary line. Well, it's pretty
remarkable with the history he has,
right? going after central banks with
manipulations of currencies that he's
now a central banker making the case
that he's bigger than the market. I
don't think he's bigger than the market,
but you know what always happens? They
can move the market in the short term.
And we're going to see how much he can
move that market in the short term and
at what expense to the dollar he's
willing to go. You jump over the VIX and
how about it folks? 1585. We hit a low
in the VIX of 1558. And yeah, you take a
look at that VIX man saying we are risk
on even with the hike coming down the
line on Wednesday.
GDX, look at that run GDX has had,
folks, from 70 to 96.
Okay, you're talking about a move of
nearly 38%. Meanwhile, gold's only up
nearly 10% over that same period of
time. Folks, thanks for tuning in. Have
a great night. Have a safe night. Enjoy
the weekend, folks. Spend your time
wisely. Enjoy it. We'll see you Monday
morning, folks. Thanks so much. Have a
great one.