Welcome to June—and to Monthly Quad 2. This macro regime is defined by accelerating growth and accelerating inflation—a bullish setup for growth stocks, momentum trades, Bitcoin, and other risk-on assets.
Quad 2 is historically one of the most favorable backdrops for pro-growth positioning—but only if you trust the signals and follow the process.
Let’s kick off the week with clarity on what actually matters—and how to position for it.
Here’s what to watch today and in the week ahead:
1. May CPI – Reflation LIKELY TO Kick In
Wednesday’s CPI report launches a critical stretch of economic data, including ISM Services and Non-Farm Payrolls. Our baseline remains that May marks the start of a reflationary trend into the back half of the year, with CPI expected to tick up from +2.31% to +2.36% year-over-year.
Quad 2 remains the dominant regime both in the U.S. and globally.
2. Labor DATA
Friday’s jobs report gives the first clear look at labor demand following Liberation Day distortions. There’s still no recessionary signal on the separations side, and the slowdown in hiring continues to look orderly.
The market has repriced Fed expectations from 4 rate cuts to just 2. That shift has legs—if inflation accelerates and labor holds. Neither supports a dovish reversal.
3. Flows – Dip-Buying Still Has Support
Markets enter the week Neutral Gamma, with the S&P 500 holding Bullish TREND and the VIX (volatility) in Bearish TREND. That’s a favorable backdrop for risk assets.
Systematic strategies—like CTAs—remain net long, and as recent high-volatility days roll off the models, buying power could increase. Unless volatility spikes again, red days should continue to find support.
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