False Breakout? Or Is A Wave Of New Market Highs Ahead? | Michael Lebowitz

Adam Taggart | Thoughtful Money® Aug 8, 2026

Summary

Real rates are reasserting themselves as the dominant driver of gold prices after a stretch when the historical link weakened, says Lebowitz.

He expects the S&P to retest the breakout before either resuming the uptrend or sliding back into the trading range.

Lebowitz argues bond yields will drift lower once oil volatility fades, with real yields near 3% anchoring the floor.

The collapse of the levered Situational Awareness fund illustrates how quickly a momentum-driven, leveraged book can blow up.

Top takeaway Reads the July payrolls report as a '5 sigma' surprise disappointment of roughly -23k jobs and argues this makes a Fed hike less likely, noting September meeting hike odds have already fallen from 80-85% to about 40%.
Highlights a sharp precious-metals rally — silver up more than 4% on at least two mornings and gold up about $170 an ounce on one recent morning — as evidence that the historical real-rate sensitivity is back in the driver's seat for gold.
Calls the S&P's move above its Bollinger Bands a possible 'false breakout' similar to the late-June downside fakeout, with the 200-day moving average on SPY around 710 sitting roughly 7-8% below spot as last-ditch support.
Uses the collapse of the heavily-leveraged 'Situational Awareness Fund' to argue 'leverage kills' and that 'the market knows more than you,' urging investors to stick to fundamentals when price action looks hard to explain.

Top takeaway Calls the labor market 'meh' for the better part of a year and warns the unemployment-rate drop to 4.1% is a participation-rate artifact, flagging wage growth of just 0.1% as a real problem given that 70% of GDP is personal consumption.
Argues bond yields have become stretched on deficit and supply fears (term premium) rather than on inflation expectations — pointing out 30-year TIPS are offering roughly 3% real yield versus flat-to-negative CAPE-based equity real returns — and expects calmer heads to eventually prevail.
Sees the S&P 500 breakout as a healthier market because chip-momentum excess and the leveraged Situational Awareness Fund have been washed out, but warns the move above the Bollinger Bands could be a false breakout like the late-June downside fakeout.
Frames GDX-vs-GLD (not GDX-vs-S&P) as the right pair-trade lens for miners and says a durable gold/gold-miner trend change hinges on real yields truly reasserting their historical negative correlation with gold, beyond just a one-week reaction to a soft payrolls print.

Top takeaway Adam summarizes that Lacy has reversed his long-held deflation stance and now argues secular inflation is the biggest risk over an arc of years rather than the next quarter.
Michael is writing a piece walking through Lacy's macro regime-change thesis; he concedes the policy backdrop looks like deglobalization but points to evidence that global trade growth has actually picked up since Trump took office.

Top takeaway Adam previews that Darius argues the Fed is doing a 'hike flex' this year to back the bond market off, which would set him up to be more dovish heading into 2027; Michael agrees the Fed may hike not because it should but to satisfy the bond market.