The market has every reason to dip this week. But make no mistake…

Even when momentum ebbs and the market endures a late summer reset, every dip will turn into a massive buying opportunity. 

For now, stocks, commodities, cryptocurrencies, even the junkiest corporate bonds on the street have their sights set on new highs. The slightest sign of red continues to attract fresh buying frenzies.

Wall Street is throwing caution to the wind in pursuit of the juiciest returns. Speculative growth themes are continuing to work. And alt-coins are finally joining the crypto rally.

Keep in mind, stocks haven’t dropped significantly since the April tariff scare. And most investors and traders have short memories. They’re operating under a “stocks only go up” framework – the perfect recipe for a painful correction.

As you can imagine, the herd will flip its lid when the market moves lower. You’ll need to keep your head on straight in order to survive and profit during the chaos.

Here’s how you’ll come out of the inevitable reset with your sanity (and trading account!) intact.

Forget the Fed

You can ignore Powell's presser tomorrow afternoon.

Everyone knows the Fed will hold rates where they are, and the same old data-dependent song and dance will remain the same. Instead, you’ll want to listen for Trump’s reaction as the president turns up the heat.

Did you notice the slight push Trump snuck in while he was slapping Powell on the back during a routine visit to the Federal Reserve last week? (Awkward!)

Never mind that the two went tit for tat over budget numbers in front of the media. Or that Trump emphatically answered, “I’d fire him!” when asked how he would handle a project manager who comes in over budget.

Perhaps the most telling moment of the entire interaction came a minute before the slap/push when the president slyly lured Powell into removing his hard hat.

The gloves are off. Trump’s second-term triumphs have emboldened his scrutiny of Fed Chairman Powell.

Whether we’re talking about tariffs or interest rates, Trump's words pack a punch. But markets prefer stability.

Another round of threats aimed at the Fed Chair could send markets into a tizzy, so track The Donald and beware of increased volatility.

Track Wall Street’s Bets

Yes, individual investors have undoubtedly thrust themselves upon the equity markets as the retail trade carves out a slice of paradise resembling the dot-com madness.

But when it comes to the bond market, the largest market in the world, Wall Street professionals hold court. And boy are they getting rowdy!

Top money managers are piling on corporate debt, but not your run-of-the-mill B-rated bonds. They’re reaching for the junkiest of the junky. Triple "CCC-rated" bonds are all the rage as investors demand higher returns.

Full disclosure: I have no interest in buying any form of corporate debt.

However, I’m tracking the High-Yield Corporate Bond ETF (HYG) for a potential breakout.

HYG is churning below its September 2024 highs. For almost a year, sellers have kept the high-yield bond ETF in check at the 80-81 zone. And it remains a logical level for prices to turn lower.

I wouldn’t be the least bit surprised to witness another bout of selling pressure in these risky assets later this week. On the other hand, I believe HYG will eventually rip their faces off. 

Imagine what stocks and other risk assets are doing when (not if) HYG is printing a fresh three-year. They won’t be catching lower, that’s for certain.

You could witness an HYG ripper this Friday after the Jobs numbers hit, or perhaps a few months down the road this Halloween.

Bottom line: don’t overlook risky debt. Considering bond market capitalization dwarfs equities globally and domestically, a junk bond breakout could fly stocks to the moon!

Focus on Ethereum

Ethereum, Bitcoin’s little brother, had been a no-show all year until last month.

Following a sluggish start to the 2025 crypto rally, ETH has tacked on a cool 75% gain as of late June.

As exciting as it may be to see ETH up and moving again, it must clear its respective 2024 peak of approximately 4,000 before joining Bitcoin at record levels.

Unfortunately, an overwhelming amount of overhead supply continues to suppress prices at those former highs. It will continue to keep a lid on Ethereum in the coming weeks, especially if the stock market averages turn lower.

However, the lack of broad participation among cryptocurrencies, most notably ETH, suggests this crypto bull hasn’t even started.

Starting with tomorrow’s FOMC announcement, the next two weeks to two months could be rocky. Trump is throwing down, as he’s wont to do, and key risk assets are hitting a wall as momentum wanes.

Nevertheless, the S&P 500 will likely reach 6,900. The riskiest bonds on the market will continue to attract investors. And Bitcoin will rip to 172K, taking the entire crypto-verse with it — even ETH.

Perhaps we’ll finally witness the long-awaited correction this week, or maybe we don’t.

Either way, it’s time to get in the right mindset so you don’t lose your head when it inevitably arrives.

For now, remember that Trump's words ultimately impact the market more than Powell’s.

You’ll also want to keep an eye on junk bonds. An HYG breakout will flash a green light for stocks, commodities, and crypto.

And finally, track Ethereum. It’s all systems go when ETH hits 4,000-plus.