The S&P, the Nasdaq, the Dow and the Russell are the four most compressed instruments in this morning's scan at 99%, 98%, 92% and 87%. Every one of them fails the deviation filter, by a wide margin, so none of them appears as a trade below. McDonald's carries the highest confidence reading in the scan at 9 across two timeframes and the overnight print backs it. Ormat is the only name with institutional convergence live, at 76% strength. Breadth deteriorated on all seven measures overnight, the first clean sweep lower in the sequence. And the bond-equity correlation flipped sides: the index feeds are clean at 0.22 while the single names now read stress at 0.41, the exact inverse of yesterday. The one number is the single S&P level that reopens all four index gates in the same session.
July CPI printed +0.1% on the month and 3.4% on the year, well under the 0.6% and 3.6% the market had braced for. The oil shock that everyone expected to show up in the headline did not show up. The S&P closed 0.25% higher at 7,747.46, back within touching distance of records, and tech led. A committee that had three dissents pushing for a September hike just lost its best argument.
INFLATIONARY PUMP at +4/9 is up a point from yesterday and still scores a long book, but the S&P and Russell feeds read DISTRIBUTION at +3/9 with the risk layer off and the macro bonus at −1 rather than +1. Two feeds disagreeing on the same morning is the caveat, and it sits on the broad-market side. The correlation reading swapped ends overnight: single names now carry 0.41, above the 0.35 line where bonds stop hedging equities, while the index feeds cleared back to a normal 0.22. Yesterday it was the other way round. Size the names accordingly.
The strip runs today because for the first time in the sequence every measure moved the same way, and that way was down. Yesterday four were frozen and two were higher. This morning none of them are.
| Metric | Universe scan | Read |
|---|---|---|
| Divergence flag | ACTIVE | Price rising, participation lagging. Seventh session. |
| A/D net | +6 on 40 advancing | Down from +14 on 44. |
| A/D ratio | 1.18 | Down from 1.47. |
| McClellan | −53.1 | Negative, worse from −51.5. |
| A/D line | +1,488 | Down from +1,544. |
| Summation | +11,414 | Down from +11,474. Seventh day lower. |
| % above 50-day | 54.1% | Down from 59.5%. |
| % above 200-day | 56.8% | Down from 63.5%. |
Structural participation lost 6.7 points in one session, which is the largest single-day drop in the sequence. Enough to keep owning individual names on their own signals. Not enough to argue with a deviation filter that has already locked out all four indices.
| # | Ticker | Dir | Entry (dev · price) | Edge (WR · Conf · Comp) | Size |
|---|---|---|---|---|---|
| 1 | MCD | Long | 🔒 Members | 78% on 500 · Conf 9 (2F) · COILED 76% | Equity Daily · Standard |
| 2 | ORA | Long | 🔒 Members | 100% (3/3) · Conf 7 (2F) · Convergence live 76% | Mid Range · Standard |
| 3 | NXE | Short | 🔒 Members | 75% (4/5) · Conf 7 (2F) · Dev PASS → +1F | High-Vol · Half |
| 4 | CEG | Short | 🔒 Members | 86% (14/14) · Conf 7 (2F) · COILED 92% | Mid Range · Standard |
| 5 | CRSP | Long | 🔒 Members | 85% (20/21) · Conf 8 (2F) · Expanded 51% | High-Vol · Half |
| 6 | MELI | Short | 🔒 Members | 71% (7/10) · Conf 8 (3F) · Signal 2 live, Dev PASS | Mid Range · Half |
| 7 | RIVN | Short | 🔒 Members | 83% on 24/29 · Conf 5 (1F) · COILED 95% | High-Vol · Half |
| 8 | RXRX | Short | 🔒 Members | 84% (19/20) · Conf 6 (2F) · Building 79% | High-Vol · Half |
| 9 | BG | Long | 🔒 Members | 100% (7/8) · Conf 6 (1F) · Building 80% | Mid Range · Standard |
If you watch one: McDonald's. Confidence 9 across two timeframes is the highest reading anywhere in a 21-instrument scan, it is one of only two names carrying a compression coil outside the locked-out indices, and it is the only name in the top three where the overnight print moved with the call rather than against it. Ormat is the runner-up and has the better structural story, since it is the single instrument in the whole scan showing institutional convergence active. But convergence at 76% with a 1-of-2 stability count is a setup still assembling, and its win rate rests on three resolved signals. McDonald's has 500 bars of record behind it. The band, the close it needs, and the price that ends it are below.
Enter your Cantillon Research subscriber email to unlock the complete August 13 brief: the McDonald's band and the close that confirms the highest confidence reading in the scan, the Ormat convergence zone and the level that ends it, the two names carrying a Dev Filter PASS and the one whose overnight print already argues against it, the exact price on all four indices where the filter reopens, the Toyota row whose trigger sits above its own gate, plus the annotated IVT terminal chart for all 21 instruments scanned.
Dev · percentage distance from the institutional VWAP anchor, the volume-weighted price institutions actually paid. Dev Filter · PASS means price is close enough to that anchor that the entry is priced well and the reading adds a confluence factor; OPEN means inside the band with room left; FAIL means too extended for a clean new entry. Gate · the price where the band is exceeded and no new entry qualifies. Conf (XF) · institutional confidence score confirmed across X timeframes. Higher is better, and more timeframes is better at the same score. COILED / Building / Expanded % · volatility compression. COILED is maximum, Building is partial, Expanded means no coil is loaded. Higher means a larger expected move when it releases. None of them state direction, and none of them override the deviation filter. WR (500) · win rate over the most recent 500-bar window, published with the resolved-signal count in brackets. A rate quoted on fewer than ten resolved signals carries almost no information and is marked as such on the row. Convergence · independent institutional models agreeing on the same zone at the same time, reported as a strength percentage. ACTIVE means live now; Diverged means they disagree and the percentage is how far apart. Stability · consecutive confirmations of the current reading, out of two. 0/2 means the reading is fresh and unconfirmed. Signal tiers · S1 is the base crossover; Signal 2 adds two independent confirming factors; Signal 3 adds four; Signal 4 adds six plus regime alignment. Snapback (SD2L) · the oversold reversal signal fired two standard deviations below the anchor. Bar count is how long ago it fired. Swing Type · the multi-bar structural direction. It can disagree with the intraday Bias, and when it does the trade is being taken against the larger trend and is sized down. Fit · the trend and chop filter. GREEN means full size, AMBER halves the position, RED means no new entries. Anchor Hold · how many bars the anchor holds per side before flipping; CHOPPY means it does not hold long enough to carry a swing. Expectancy (R) · average result per signal in units of risk, where a stop is always exactly −1.00R. Composite · the sum of the nine active Cantillon layers, maximum +9. Macro bonus · the regime's tailwind or headwind applied to every trade. Bd-Eq Corr · 60-bar rolling correlation of bond and equity returns; above 0.35 the two are treated as one risk and bonds stop hedging equities. Tiers · High-Volatility strict, Mid-Range (+5pp band), Equity Daily (+10pp band). The tier sets the base position size before any other adjustment.