Yields fell yesterday on positive Q3 GDP data showing US economy grew at 4.3% rate in Q3, accelerating from 3.8% in Q2. Growth primarily driven by consumption thanks to accelerated demand for goods and services. Net exports rose as imports continued declining (attributed to tariffs) while exports grew—goods exports rose 7.4% while goods imports fell 7.5%. Government spending added to mix with defense spending and shutdown-related buyouts of federal workers affecting numbers, though shutdown likely drag in next quarter. Interestingly, defense spending at highest in 1 year while non-defense spending continues dropping. Prices came in at 2.8% annual growth based on PCE. Critical warning: While good news for US economy, stark inequality driving these numbers is evident as lower income sections of American society continue struggling with weak labor market. Evidenced by net disposable income rising by 0% this quarter. Key question: How are people buying goods driving consumption? Only two answers: credit or savings. If people dipping into savings to consume, picture painted is not pretty. With lower interest rates and improved liquidity conditions, acceleration expected in Q1 2026. However, benefits must trickle down to lower income strata for growth to sustain.
Key Levels: Support at 6,785.10 | Resistance at 6,987.0
Investor Takeaway: Rebound keeps prices firmly between bottom and middle prong of hourly pitchfork; RSI at 65 below MA line with flat MACD momentum—strong GDP masks dangerous consumption funded by savings depletion.
