This is VIXShield — the Sunday Forecast for the week of April twentieth, twenty twenty-six.
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There is a particular kind of Sunday that traders know well. The kind where the week behind you was genuinely surprising — where the market moved in ways that felt almost too clean, too purposeful. And now you're sitting here, coffee in hand, wondering whether next week carries the same energy, or whether the tide is quietly shifting beneath a calm surface.
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This is one of those Sundays.
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The S&P five hundred closed Friday at seven thousand, one hundred and twenty-six. The VIX — the market's fear gauge — settled at seventeen and a half. And somewhere beneath those two numbers is a story worth telling carefully. Because what happened last week, and what may happen in the days ahead, has real implications for how you prepare, how you size, and how you think about risk.
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We're going to walk through all of it together. The market context, the macro calendar, the volatility picture, and what the VIXShield strategy framework is signaling as we head into Monday. So let's take a breath, and begin.
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These signals and insights are for educational purposes only and are not financial advice. Trading involves substantial risk of loss. You can lose more than your initial investment. No live trade execution — signals only. Past performance is not indicative of future results.
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This episode is brought to you by Iron Condor Command — the definitive guide that has helped thousands of traders master defined-risk strategies with confidence.
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Now. Let's talk about what just happened.
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Last week, the S&P five hundred gained three and a half percent. That is not a quiet week. That is the kind of move that reshapes narratives, resets positioning, and forces even the most cautious traders to reconsider their assumptions. The index closed Friday at seven thousand, one hundred and twenty-six — and if you've been following along for any length of time, you know that number represents a significant milestone. A new record high.
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And the VIX? Seventeen and a half. That is a number that tells its own story. Not fearful. Not complacent. Somewhere in the middle — the kind of reading that says the market is cautiously optimistic, not euphorically reckless. It's the kind of VIX level that experienced options traders watch closely, because it sits in a zone where conditions can shift in either direction without much warning.
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The signal pattern over the past five trading sessions was five PLACE signals and zero HOLD signals. For newer listeners, a PLACE signal is the VIXShield framework's way of saying conditions are favorable for deploying a defined-risk options position — specifically, an iron condor. Zero HOLD signals over five days means the system found no reason to step aside. That is a remarkably clean run.
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Now, what was driving all of this? The macro backdrop last week was dominated by one headline above almost all others. Reports emerged of progress in US-Iran peace negotiations — and the market responded with the kind of risk-on surge that only genuine geopolitical relief can produce. Oil prices dropped sharply — by some accounts, more than ten percent over the course of the week. When oil falls that hard, that fast, it tells you something important: the market was pricing in a meaningful reduction in geopolitical risk premium.
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Lower oil prices are, in many ways, an economic stimulus. They ease inflationary pressure. They reduce input costs for businesses. They put more money in consumers' pockets. And they allow the Federal Reserve a little more breathing room in its ongoing balancing act between growth and inflation. So the equity market did exactly what you'd expect it to do — it ran.
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The Nasdaq, according to reports, extended its winning streak to thirteen consecutive days — tying the longest such run in its history. That is a remarkable piece of market trivia. Thirteen days of gains in a row, matching a record that has stood for decades. Whether that streak continues, or whether the law of mean reversion asserts itself, is one of the defining questions heading into this week.
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Meanwhile, on the currency side, the Dollar Index — the DXY — closed Friday at ninety-eight and change. That's a relatively soft dollar reading, which tends to be supportive of risk assets and multinational corporate earnings. Bitcoin closed near seventy-four thousand, four hundred dollars. Ethereum was just above two thousand, two hundred and seventy. The crypto complex was broadly constructive, consistent with the overall risk-on tone.
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So that's the backdrop. A strong week. Record highs. A VIX that stayed calm. Five clean PLACE signals. And a geopolitical catalyst that, at least for now, seems to have genuinely shifted sentiment.
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The question — and it's always the question on a Sunday like this — is what comes next.
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Let's turn to the economic calendar, because this is where preparation becomes practical.
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The week of April twentieth through the twenty-fourth is one of those weeks that options traders circle in advance. And here's why. We are in the heart of earnings season. We are in a period of heightened sensitivity to Federal Reserve communications. And we are in an environment where the macro data — inflation readings, housing data, labor market signals — carries outsized market impact because the Fed is still navigating a delicate path.
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Let me walk you through what to watch, and more importantly, why each piece matters.
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Early in the week, the focus will be on housing data. We typically see existing home sales figures and housing starts data in the third or fourth week of a month, and this week likely falls into that window. Housing has been a persistent pressure point in the inflation story — shelter costs have been among the stickiest components of the Consumer Price Index. Any signal that housing activity is cooling — or alternatively, that it's reaccelerating — will be read through the lens of what it means for the Fed's next move.
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Mid-week brings what is often the most closely watched data point of any given week when it falls — initial jobless claims. Released every Thursday morning, this is the labor market's weekly pulse check. The labor market has been the Fed's primary justification for maintaining a cautious stance on rate cuts. If claims tick higher, it could accelerate rate-cut expectations. If they remain low, it keeps the Fed in a holding pattern. Either way, the number moves markets.
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Also mid-week, keep your eye on any scheduled Federal Reserve speeches. We are in an elevated rate-sensitivity environment — meaning market participants are parsing every word from Fed officials with unusual intensity. Any hint of a shift in tone — either toward more accommodation or toward renewed hawkishness — can produce outsized moves in both rates and equities. If a Fed governor or regional Fed president is scheduled to speak this week, treat that as a potential volatility event.
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And then there's the Treasury auction calendar. This is something that doesn't always get attention in mainstream financial media, but it matters enormously for equity markets. When the Treasury auctions large volumes of debt — particularly in longer maturities like the ten-year or thirty-year — the demand for those auctions signals where institutional money is flowing. Weak demand pushes yields higher, which tends to pressure equity valuations. Strong demand does the opposite. This week, watch for any scheduled note or bond auctions, particularly in the middle of the week. The bond market is, in many ways, the equity market's landlord.
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Now, the elephant in the room this week is earnings. And I want to spend a moment here, because earnings season is not just about individual stock moves. It is about the aggregate signal those results send to the broader market.
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We are in the thick of first-quarter twenty twenty-six earnings reports. By the end of this week, a significant portion of the S&P five hundred's market capitalization will have reported. The question the market is asking is simple but consequential: did corporate America actually deliver on the optimism that drove markets to record highs? Or are the cracks beginning to show?
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Several major financial institutions and large-cap technology names typically report in this window. Without naming specific companies — because earnings calendars can shift and we want to be precise rather than speculative — the pattern to watch is this: how are companies guiding for the rest of the year? The actual earnings number for the quarter is almost secondary to what management teams say about the outlook. In an environment of geopolitical uncertainty and shifting trade dynamics, forward guidance is everything.
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If guidance is strong — if companies are raising their full-year outlooks — the market's record-high reading becomes more defensible, and the VIX may stay calm or drift lower. If guidance disappoints — if companies are pulling back on forecasts, citing tariff uncertainty or demand softness — expect the VIX to respond. Possibly quickly.
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And that brings us to the volatility picture, which is where this podcast lives.
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Let's talk about the VIX term structure, because right now it is telling a very specific story — and that story has direct implications for how we think about options strategy this week.
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As of Sunday, the VIX spot reading is seventeen and forty-eight hundredths — essentially unchanged from Friday's close. But the more interesting number is the VXV, which measures implied volatility over a ninety-day horizon. The VXV is sitting at twenty and a half. That gap — roughly three points between the near-term VIX and the longer-term VXV — puts the term structure in what we call strong contango.
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For newer listeners, let me explain what contango means in this context. Contango simply means that longer-dated volatility is priced higher than near-term volatility. Think of it this way: the market is saying, "Right now, things feel relatively calm — but we expect more uncertainty over the next few months than we do over the next thirty days." It is the normal, baseline state of volatility markets when fear is absent. And a three-point spread between VIX and VXV is a meaningful contango reading — not extreme, but solidly in positive territory.
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Why does this matter for strategy? Because strong contango is, historically, one of the more favorable environments for defined-risk options strategies like iron condors. When the term structure is in contango, the implied volatility that you are selling — the premium embedded in options prices — tends to decay in your favor over time. The market is pricing in uncertainty that, if it doesn't materialize, becomes your profit.
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That said, contango is not a guarantee. It is a condition. A favorable wind, not a tailwind you can count on in a storm.
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Here is the nuance worth sitting with this Sunday. We have a VIX at seventeen and a half. That number sits in what the VIXShield framework would describe as a moderate regime — not the sub-fifteen "calm" zone, and not the above-twenty "elevated" zone. It's the middle ground. And the middle ground requires a particular kind of discipline.
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When VIX is in the mid-to-upper teens, the market is telling you that it's not fearful — but it hasn't fully relaxed either. There is latent uncertainty being priced. And with a strong week of gains behind us, a Nasdaq streak at historic lengths, and a macro calendar packed with potential catalysts, the conditions exist for the VIX to move in either direction.
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If the earnings reports come in strong and the economic data is benign, we could see VIX drift toward fifteen or below. That would be a further relaxation of the volatility premium. If, on the other hand, a major earnings miss spooks the market, or a Fed speaker says something unexpected, or the geopolitical situation shifts — VIX could move back toward twenty or above with relatively little warning.
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That asymmetry — the possibility of a move in either direction — is exactly why the VIXShield framework uses a rules-based approach rather than an opinion-based one. Opinions about where VIX is going are plentiful. Rules that respond to where VIX actually goes are rare and valuable.
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Let's talk about earnings and event risks in a bit more depth, because this week deserves specific attention.
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We mentioned the Nasdaq's thirteen-day winning streak. Streaks like that are psychologically significant in ways that go beyond the mathematics. They create a self-reinforcing narrative — "the market is strong, therefore I should be in the market" — and that narrative can sustain itself right up until the moment it doesn't. The longer a streak runs, the more participants have bought into the story. And the more participants who have bought in, the more potential sellers exist if the story cracks.
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This is not a prediction that the streak ends this week. It is simply a recognition that when markets are at record highs on the back of a thirteen-day run, the risk-reward profile of being caught flat-footed is asymmetric. The market doesn't need a catastrophe to pull back. It just needs a reason to pause.
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And earnings season provides plenty of reasons to pause — or to surge. The dynamic this week is particularly interesting because we are seeing results from companies that span the entire economic spectrum. Technology companies that benefited from AI investment cycles. Financial companies navigating interest rate dynamics. Consumer companies facing the dual pressures of inflation and softening demand. Industrial companies dealing with supply chain and tariff uncertainty.
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Each of those sectors tells a different piece of the economic story. And the aggregate of what they report this week will do more to shape the market's view of the second half of twenty twenty-six than almost any single data point.
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One more event risk worth naming: the geopolitical backdrop. Last week's US-Iran peace talk headlines were a genuine catalyst. But geopolitical situations are, by their nature, fragile. A breakdown in talks, a new provocation, an unexpected development — any of these could reverse the risk-on sentiment that drove last week's gains. Oil prices, which fell sharply last week, would be one of the first signals to watch. If oil begins to recover, it may indicate that the geopolitical risk premium is coming back into the market.
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Keep an eye on oil. It will tell you things before the equity market does.
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Now let's move into the strategic heart of this episode — how the VIXShield framework actually applies to the conditions we're describing.
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For those new to VIXShield, here is the conceptual foundation. The strategy is built around iron condors — a defined-risk options structure where you simultaneously sell both an out-of-the-money call spread and an out-of-the-money put spread on the same underlying index. The goal is to collect premium from both sides and profit if the market stays within a defined range. Your maximum gain is the premium collected. Your maximum loss is capped by the width of the spreads. It is a strategy built for environments of moderate, stable volatility — and it is a strategy that requires discipline in execution.
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The VIXShield framework adds several layers of intelligence on top of that basic structure. Let me walk through them in the context of this week.
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The first layer is the Expected Daily Range, or EDR. This is a calculation that uses the current VIX level to estimate how much the market is expected to move on any given day. At a VIX of seventeen and a half, the EDR is telling you something specific: the market is pricing in a daily move of roughly one and a tenth percent. That is the market's own estimate of its short-term volatility. When you're placing iron condor strikes, the EDR helps you determine how far out of the money those strikes should be — giving your trade room to breathe without being so wide that you sacrifice meaningful premium.
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Here is the key relationship to understand. As VIX rises, the EDR expands — meaning the market expects larger daily moves, and your strikes need to be placed further out to maintain the same probability of success. As VIX falls, the EDR contracts, and you can place strikes closer in while maintaining similar risk parameters. At seventeen and a half, we're in a moderate zone — not so tight that every small move threatens the trade, not so wide that the premium collected becomes negligible.
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The second layer is the VIX Trend Rules — the filter that determines whether conditions are actually favorable for entering a new position. These rules look at the direction and momentum of VIX, not just its current level. A VIX that is at seventeen and a half but rising is a very different signal than a VIX at seventeen and a half that is stable or declining.
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Right now, the VIX came down over the course of a strong week. That is a constructive signal — it suggests that as the market moved higher, fear was being reduced, not accumulated. When VIX falls during a market rally, it confirms the rally rather than contradicting it. That is a healthier setup than a market that rises while volatility also rises — which would suggest the move is driven more by forced buying than by genuine conviction.
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The VIX Trend Rules would, in this environment, be looking for continued stability or a modest continuation of the downward trend as a green light for new entries. If VIX begins to tick higher on Monday — particularly if it moves back toward nineteen or twenty — the rules would begin to tighten, signaling more caution about new positions.
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The third layer is ALVH — the Adjusted Level of Volatility and Historical context. This component of the framework looks at whether current volatility levels are unusual relative to recent history. A VIX of seventeen and a half in a market that has been running in the mid-twenties for months is very different from a VIX of seventeen and a half in a market that has been consistently below fifteen. Context matters.
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Right now, the ALVH reading would be noting that we've had a meaningful compression in volatility over the course of this rally. That compression is consistent with the strong contango in the term structure — the market has released near-term fear while still pricing in some longer-term uncertainty. The ALVH signal in this environment would likely be constructive, but with a note of caution about how much further volatility can compress before we reach a zone where the risk of a snapback becomes elevated.
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Think of it this way. Volatility compression is like a spring being wound tighter and tighter. The tighter it gets, the more energy is stored. At some point, that energy releases — and when it does, it tends to release quickly. The ALVH framework helps identify when the spring is getting wound to a point where the risk-reward of adding new positions begins to shift.
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So what does all of this mean for Monday's signal? Without being predictive — because the framework responds to data, not forecasts — here is the scenario tree worth thinking through.
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Scenario one: VIX remains stable or drifts lower through early Monday trading. Earnings results from weekend reporters are constructive. The macro data that comes out early in the week is benign. In this scenario, the term structure remains in strong contango, the VIX Trend Rules remain constructive, and the ALVH reading stays favorable. The EDR remains in the moderate range. This is the environment where the framework would most clearly support a PLACE signal — conditions aligned, premium available, defined risk manageable.
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Scenario two: VIX moves higher on Monday morning — let's say back toward nineteen or twenty — in response to a disappointing earnings report or an unexpected macro development. The term structure may begin to flatten as near-term volatility rises toward the longer-term implied level. In this scenario, the VIX Trend Rules would begin to apply a filter — not necessarily saying "no position," but saying "wait and watch." The EDR would expand, meaning strike placement needs to be adjusted. Position sizing, which we'll talk about in a moment, would also need to reflect the higher uncertainty. This is a scenario where patience is the strategy.
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Scenario three: VIX spikes sharply — above twenty-two or twenty-five — driven by a genuine shock. A geopolitical escalation. A major earnings miss from a market-leading company. An unexpected Fed communication. In this scenario, the ALVH activation logic would flag elevated risk conditions. The framework would likely shift to a HOLD posture — meaning no new positions, protect existing ones, and wait for the volatility picture to stabilize before re-engaging. This is the scenario where the discipline of having rules pays for itself. Because in a spike, the temptation is to do something — to react, to hedge, to trade the fear. The rules say: wait.
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These three scenarios are not predictions. They are a map. And having a map before the week begins is the difference between reacting and responding.
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Let's close the strategic section with a note on iron condor sizing in this specific environment. At a VIX of seventeen and a half, with the market at record highs and a packed earnings calendar ahead, this is not a week to be oversized. The premium available is meaningful — implied volatility at this level provides reasonable compensation for the risk you're taking — but the potential for a sudden move is also real.
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A useful mental model for this week: think of your position size as a dial that goes from zero to ten. In a quiet, low-VIX, low-event-risk week, you might be comfortable at a seven or eight. In a high-VIX, high-uncertainty week, you'd be at a two or three. This week — record highs, earnings season, moderate VIX, geopolitical backdrop — feels like a four or five. Enough exposure to participate in the premium decay if conditions stay calm. Not so much that a single bad day creates a meaningful drawdown.
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Theta — the daily time decay that options sellers collect — is your friend in a stable environment. But theta is patient. It works slowly and consistently. Risk events are not patient. They work suddenly and violently. The goal of position sizing is to make sure that when a risk event arrives — and eventually, one always does — your account can absorb it and still be standing to collect theta the following week.
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Now, a few specific risk management reminders for the week ahead.
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First, know your adjustment triggers before Monday opens. If you have an existing position, identify in advance the price levels or VIX levels at which you would adjust or close. Don't make those decisions in the heat of a fast-moving market. Make them now, while it's quiet, while you can think clearly.
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Second, watch the bond market. The ten-year Treasury yield is one of the most important leading indicators for equity volatility right now. If yields spike — meaning bond prices fall — it tends to create headwinds for equity valuations, particularly in growth and technology names. A significant move in yields this week would be an early warning signal worth heeding.
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Third, pay attention to how the market opens Monday morning. The overnight futures session and the first thirty minutes of cash trading will tell you a great deal about how participants are positioned and how they're interpreting the weekend news flow. A gap higher on strong earnings or positive geopolitical news is a different environment than a flat or slightly lower open. Let the market tell you what it wants to do before you act.
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Fourth, and perhaps most importantly for iron condor traders specifically — be aware of the gamma risk that builds as we move through the week. Gamma is the rate at which an option's sensitivity to price changes accelerates as expiration approaches. In plain terms: options become more volatile relative to the underlying as expiration gets closer. If you're holding short-dated positions and the market makes a large move late in the week, the impact on your position can be disproportionate. Managing that risk — either by closing positions before they get too close to expiration in a volatile environment, or by choosing expirations that give you more time — is a key discipline this week.
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Fifth, keep an eye on the geopolitical headlines. We said it earlier, and it bears