TradingEdge Weekly for Jul 24 - Seasonal weakness zones, Lithium-gold signal, CDX credit warning, GLD capitulation, sentiment cycle, Hang Seng breadth, energy confirmation

Key points:

• Platinum, Aussie Dollar, German EWG, UK EWU, and Biotech IBB all face historically bearish seasonal windows.
• When the LIT Optix 10-day MA crosses below 19 for the first time in six months, LIT has an 80% win rate at 2-3 months, but surprisingly GLD shows 90-100% win rates.
• The CDX Index crossed above its 50-day moving average, ending a 66-day streak of credit calm - historically, $10,000 invested only when CDX was below its 50-day MA grew to $42,125 vs. $21,194 when above, with half the drawdown.
• GLD has plunged 28% from its January 2026 high and broken below all moving averages, but the Optix indicator is flashing extreme pessimism readings that have historically produced high win rates - as long as the $360 support level holds.
• The Smart/Dumb Money Confidence Spread cycled from +0.30 to -0.33 - only 32 such cycles since 1999.
• Over 95% of Hang Seng constituents surged above their 10-day MA - the highest participation in over a year - and the 50-day breadth just crossed 55% from sub-10% levels; historically, this setup shows 82% win rate over 4 months with only 4 failures.
• XLE's inner trend spread crossed above 50 while crude remains in backwardation (>1.05 term structure) - the combined signal shows 71% win rate at 4-6 months.

House view:

• Stocks:
  • Short-term