TradingEdge Weekly for Jul 31 - Unleaded Gas bearish setup, Utility-tech divergence, COT positioning extremes, Seasonal sell zones, Treasury yield spike, KOSPI selloff, Hedge fund rebound

by Sentimentrader

2026-07-31

Key points:

Unleaded Gas is in historically rarefied air near 340 levels, facing a bearish seasonal window (July 24 - September 9) that has produced a cumulative -90.7% loss since 2006, with crude backwardation and extreme positioning adding to the bearish case - though price remains above the 70-day EMA, making any short play counter-trend.
Over 95% of utility stocks trade above their 50-day MA while less than 30% of tech stocks do - a gap >65% that's occurred fewer than 30 times in 30 years; historically the S&P 500 rallied 77% of the time over the next 4 months with +3.4% average return.
The COT Regime Gap's 7-week change plunged below -120 as Hedgers Combo hit 0 and Speculators Combo hit 89; short-term returns are poor (33% positive at 2 weeks), but one-year horizons show 67% positive - the real signal is a bumpier path, not necessarily a directional call.
XME faces a seasonal window (July 31 - October 6) with a cumulative -72% loss since 2006, while EEM's unfavorable period (July 30 - August 21) shows a cumulative -39% loss - neither guarantees a decline, but the odds favor finding opportunities elsewhere.
The 10-year Treasury yield reached the 75th percentile of its 3-year range - in the modern era, these spikes reverse lower 57% of the time at 3 months, and the S&P 500 shows a classic 'short-term pain, long-term gain' pattern with a 79% win rate and +11% median return at one year.
After a 297% rally from April 2025 to Jun

Sorry, you don't have access to this report

Upgrade your subscription plan to get access

Go to Dasboard

Key points:

Unleaded Gas is in historically rarefied air near 340 levels, facing a bearish seasonal window (July 24 - September 9) that has produced a cumulative -90.7% loss since 2006, with crude backwardation and extreme positioning adding to the bearish case - though price remains above the 70-day EMA, making any short play counter-trend.

Over 95% of utility stocks trade above their 50-day MA while less than 30% of tech stocks do - a gap >65% that's occurred fewer than 30 times in 30 years; historically the S&P 500 rallied 77% of the time over the next 4 months with +3.4% average return.

The COT Regime Gap's 7-week change plunged below -120 as Hedgers Combo hit 0 and Speculators Combo hit 89; short-term returns are poor (33% positive at 2 weeks), but one-year horizons show 67% positive - the real signal is a bumpier path, not necessarily a directional call.

XME faces a seasonal window (July 31 - October 6) with a cumulative -72% loss since 2006, while EEM's unfavorable period (July 30 - August 21) shows a cumulative -39% loss - neither guarantees a decline, but the odds favor finding opportunities elsewhere.

The 10-year Treasury yield reached the 75th percentile of its 3-year range - in the modern era, these spikes reverse lower 57% of the time at 3 months, and the S&P 500 shows a classic 'short-term pain, long-term gain' pattern with a 79% win rate and +11% median return at one year.

After a 297% rally from April 2025 to Jun