It's Now A 'Hair-Trigger'Market | Tom McClellan
Due to uncertain liquidity conditions
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When markets are as volatile as they have been the past several weeks and the macro outlook is as uncertain as the year ahead currently looks, turning to the data & navigating by what it’s telling us is often highly useful.
Which is why we’re fortunate to have one of the best technical analysts in the industry, Tom McClellan, joining us today to share his latest interpretation of the current market action.
Tom observes that the market is becoming more trigger-happy & reactive to news due to uncertain liquidity conditions.
So he cautions investors to expect more volatility from here.
For a whole bunch of charts explaining why, click here or on the video below:
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Adam’s Notes: Tom McClellan (recorded 10.13.25)
EXECUTIVE SUMMARY:
Trigger-Happy Volatility Amid Liquidity Squeeze: Markets are hypersensitive to news like Trump’s tariff threats, amplified by drying liquidity—akin to musical chairs with fewer seats—making cascades (e.g., Friday’s 2.5% S&P drop via crypto margin calls) more likely; Fed’s $1T/month support in 2020 absorbed shocks, but current illiquidity heightens vulnerability.
Seasonal Inflection with Divergences: Mid-October marks the end of bearish seasonality and start of the “best six months” (Nov-Apr), but bearish divergences in McClellan Oscillator (oversold bounce), Summation Index (liquidity warning), NYSE A/D line, and high-yield bonds signal potential trouble; rehabitable but concerning, echoing 2021-22 bear market prelude.
