Mid-Week Macro (7/2/2025)

The stock market continues to trend higher, with the S&P 500 closing today at 6227, which is an ATH. The dollar (DXY) has been soft, closing today at 96.4. That has helped gold ($3346) and silver ($36.33) to remain strong. The 10-Year bond has also been soft, closing at 4.26%.

Wall Street has been having a party since mid-April. How much longer will it last? My guess is not much longer. I’m expecting July to be a shocker, as Trump unleashes shock #2. I’m expecting him to enter into a trade war with Japan and Europe. He already started one with Canada, where he broke off negotiations last week.

I think the correction begins in July and will take about 9 months to reach the bottom in the S&P 500, at around 3500. Let’s see how July unfolds. If Trump can release his Tariff Tantrum in July and get away with it, I’ll be surprised. Those who think he will be Mr Taco (Trump always chickens out) are in for a surprise. Instead, he will be Mr TT (Tariff Tantrum).

Because of my bearish outlook for the stock market in July, I think this current run in silver and the HUI is a bull trap. I’m expecting silver to retrace to sub $34 and perhaps all the way to $31. Gold should see a $31xx handle, but $32xx might hold. The HUI is likely heading to 350, and perhaps a bit lower.