Net Liquidity Tightens, Stops Tighten
November 16, 2025 Update
MACRO
From a macro perspective, although the latest M2 data showed an increase in the monetary base of the U.S. economy, net liquidity has actually tightened over the past few weeks. This typically hurts risk assets like stocks and cryptocurrencies in the short term.
Financial conditions are still healthy, but it’s better to keep an eye on net liquidity.
If the positive trend resumes, we should see a rebound in stock prices.
The U.S. government shutdown ended last week and economic data releases will resume.
Inflation is the key number to watch and it should stay around or below 3%.
The latest estimate for Q4 GDP growth is around 2%, which supports the case for future rate cuts.
I’m still in the optimistic camp for equities over the medium term.
Valuations remain a headwind, especially for AI and tech-related names.
That said, we are not in a bubble—at least not yet.
INDEXES
The S&P 500 closed the week roughly flat, but a lot happened under the surface.
Tech and growth stocks were hit hard, and there was more damage than the index level suggests.
Index read — S&P 500 (weekly chart)
Stage: Stage 2 (advancing), late/maturing.
Price vs MAs: Last ~6,731 sits right on the rising 10-week (~6,734), well above the 20-week (~6,519) and 30-week (~6,282). Trend rails are still up.
Momentum: Weekly MACD is positive but flattening; histogram is fading. RSI ~63—still strong, but cooling.
Volume/character: Another whippy week. No decisive accumulation bar; selling pressure remains elevated on down days.
Risk line: A weekly close below the 20-week would signal a character change toward Stage 3 risk. The 30-week is the bull-trend “line in the sand.”
The Fear & Greed Index is in extreme fear territory, which often can be a good time to start buying again.
Breadth keeps deteriorating.
And last but not least, volatility is hovering around 20. Ideally, we’d like to see it back below 15.
As mentioned many times, pullbacks are absolutely normal and to be expected.
What I can do is stay prepared and use stop-loss levels to protect my capital.
Bottom line
The bull trend is intact on the weekly timeframe, but the market is acting like late Stage 2, approaching Stage 3.
Until breadth improves and volatility eases, I’ll:
Favor selective longs in Healthcare and Energy (the only sectors acting well).
Avoid chasing extended growth stocks.
Let the 10/20/30-week “rails” dictate my risk.
PORTFOLIOS
Also this week, I will be watching and waiting.
I adjusted my stop-loss levels; details below.
10X MOMENTUM PORTFOLIO
I was stopped out of my MVST position for a -25% loss (ouch).
Everything else still looks fine.
All remaining positions are in the green, except ASND, which is flat. Below is the updated scorecard.
10X UNDERPRICED GROWTH PORTFOLIO
Here I was stopped out of INVZ for a -25% loss and DLO for a -13.7% loss.
I am now mostly back in cash.
I’m not buying anything new just yet. Stop-loss levels are updated and in place.
Let’s see what next week brings.
Best of luck to you all!
Important: This post is not investment advice.
Please consult a licensed financial adviser before making any investment decision.