Yesterday, Thursday, March 26, 2026, the markets reminded us exactly why "patience is a position." The S&P 500 suffered a sharp -1.74% drop, closing at 6,477.17. As shown in the chart provided, the index is now undergoing a high-stakes retest of its recent lows.

📉 Active Option Trade Tracker

Our decision to sit in 100% cash is paying off handsomely. We are avoiding the "chopping block" of this volatile retest while preserving our perfect record for the year.

• US 500 Strategy (IG): Up +9.20% YTD.
• XSP/SPY Challenge (IBKR): Up +7.27% YTD.
• S&P 500 Index: Down -5.37% YTD (based on yesterday's close).

The Big Question: Will this level hold? Technically, the only silver lining from yesterday’s session is that a new low was not created—yet. However, the S&P 500 remains firmly in a short-term downtrend and, crucially, is still trading below its 200-day moving average (green line on your chart). Until the index can reclaim that level, the path of least resistance remains lower.

🏛️ The Yield Headwind: Why Stocks with Higher Yields

A major factor behind yesterday's sell-off was the jump in the US 10-Year Bond Yield, which hit an eight-month high of 4.42%.

Why are higher yields "kryptonite" for stocks?

1. The "Risk-Free" Competitor: When government bonds pay over 4.4%, they become an attractive, "safe" alternative to stocks. Investors often move money out of the volatile equity market and into the safety of fixed income.
2. Valuation Math: Professional analysts use the 10-year yield as the "discount rate" for future earnings. When yields rise, the "present value" of a company's future profits drops—this hits high-growth tech stocks like NVDA particularly hard.
3. Borrowing Costs: Higher yields lead to more expensive mortgages, car loans, and business credit, which slows down the overall economy.

📋 Market Sentiment & Geopolitics

The primary driver of the current "wait and see" mood is the shifting timeline in the Middle East.

• Deadline Extension: President Trump has extended the deadline for potential strikes on Iran’s energy infrastructure by another 10 days. While this provides a temporary breather, it also extends the period of peak uncertainty.
• The "Wait" Strategy: We remain not a fan of buying any stocks for the long-term portfolio right now. We want to see the "geopolitical tax" (and those bond yields) come down before we start buying.

📅 Market Review for Thursday, March 26, 2026

Overview: Yesterday was a classic "de-risking" session. The VIX spiked toward 29, reflecting growing anxiety that the "retest" of the lows might fail if the 10-year yield continues to climb.

📈 Major Indices & Commodities

• S&P 500: Fell -1.74%, closing at 6,477.17.
• Nasdaq Composite: Dropped -2.10%, finishing at 21,215.11.
• Dow Jones Industrial Average: Slumped -1.35%, closing at 44,972.33.
• US 10-Year Yield: Rose to 4.42% (Highest since July 2025).

Next Step: We will remain patient. It will be next week at the earliest before we consider placing an April trade.

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Happy Investing

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