Kevin Steuer argues the market backdrop has shifted into a more volatile, risk-off regime driven mainly by oil, Middle East conflict, and the knock-on effects for inflation, rates, and liquidity. He stays cautious on broad equities and Bitcoin, prefers trend-following with tight risk management, remains constructive on gold and AI-related infrastructure, and says his system is showing more yellow/red than green right now.
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This was a market-focused interview with David Lin and technical trader Kevin Steuer, centered on how to trade a likely rise in volatility. Lin opened by framing the day’s action: oil spiked sharply, stocks reversed intraday, Bitcoin firmed, and gold was softer. Steuer said the main volatility drivers are oil, the Middle East conflict, and the broader implications for inflation, rate cuts, and politics, and he thinks volatility could persist into the summer. On equities, he described the S&P 500 as short-term neutral but bearish overall in his system, with weak support and more downside risk than upside. He said a move toward roughly 6500 is possible and that a larger washout would likely require escalation in Iran plus confirmation from other stress indicators such as the VIX staying above 30, elevated move index readings, and dollar strength. …
Near term, this is a risk-on/risk-off tape dominated by oil and Iran headlines; I’d treat rallies as fragile until volatility measures cool and the geopolitical premium fades.
Over the next few weeks, the base case is a choppy, selective market where only clean trend setups work. A durable upside reset would need lower oil volatility, calmer credit/liquidity conditions, and less escalation risk.
The structural view is that AI accelerates dispersion: some labor-heavy businesses lose margin power while infrastructure, minerals, and hard assets stay bid. Gold and AI can coexist as portfolio hedges on different sides of the same regime shift.
Oil, Middle East conflict, inflation expectations, and rate-cut uncertainty are the main sources of current market volatility.
He explicitly names these as the biggest drivers of volatility right now.
The S&P 500 has lost momentum and has more downside risk than upside in the near term.
He says it is bearish overall, short-term neutral, and lacks support.
A larger market selloff would likely require Iran escalation plus confirmation from volatility and liquidity indicators.
He lists VIX, 10-year yield, MOVE index, and dollar thresholds as the conditions for a major downside move.
What are the biggest drivers of volatility right now in your opinion?
Kevin says the price of oil is one driver, along with the conflict in the Middle East and its broader implications for inflation, rate cuts, and midterms. He notes a lot of uncertainty and expects volatility into the summer.
Can we pull up an S&P 500 chart and start there? The S&P has been trading sideways, peaked in early January and has been rolling over since mid-January — can you confirm it's in the beginning of a larger downtrend?
Kevin shares his screen showing his confluence system. He says the S&P has lost momentum, is short-term neutral with a negative trend and bearish overall. He notes there's not much support underneath and more risk to the downside than upside, with resistance levels at sevens and eights and support at twos and fours.
What does 'not great' mean — a bigger downtrend?
Kevin says he could see a move down to around 650 on the S&P but doesn't think there will be a massive sell-off unless Iran escalates. He watches the VIX (staying over 30), the 10-year, the move index, and the dollar — if all those thresholds hit, that could trigger a liquidity crisis or margin calls leading to big sell-offs.
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