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Q1 Finale: Navigating Inflation Data and AI Exhaustion · The SPY Trader

• 0:00
  Good morning , everyone !
• 0:02
  I am your host , Barnaby Bull , and you are tuning in to Spy Trader .
• 0:06
  It is exactly 6 a.m.
• 0:08
  here in the Pacific time zone on Sunday , March 22nd , 2026 .
• 0:13
  I hope you have your favorite mug ready because we have a very busy week to look forward to as we enter the final full trading week of the first quarter .
• 0:22
  Right now , the market mood is best described as cautious optimism .
• 0:27
  We are seeing a resilient labor market , but the Federal Reserve is staying very focused on the data before they make any more moves with interest rates .
• 0:36
  Looking at the big news items for the week of March 23rd through the 27th , all eyes are on Friday .
• 0:43
  That is when we get the Core PCE price index report .
• 0:47
  This is the Fed’s preferred inflation gauge , and it is the big test for the last mile of inflation .
• 0:54
  We saw some stickiness in the services sector earlier this month , so if that PCE number comes in higher than the expected 0.2 percent , we might see a selloff in longterm Treasuries .
• 1:06
  That would put a lot of pressure on the iShares 20 plus Year Treasury Bond ETF , which traders know as TLT .
• 1:13
  In the tech world , the focus is shifting .
• 1:16
  We are moving from just buying chips to looking at how software is actually being used .
• 1:22
  While NVIDIA and Microsoft are still the big names in the Invesco QQQ Trust , we are starting to see some signs of AI exhaustion .
• 1:30
  Investors are looking for a real return on investment from these software firms .
• 1:35
  If the techheavy QQQ can not break through its current high point , we might see money move into more traditional value sectors .
• 1:43
  Another area to watch is Healthcare .
• 1:45
  We are expecting some new data on oral weightloss pills from some smaller biotech companies early this week .
• 1:53
  This will likely cause some movement in the Health Care Select Sector SPDR Fund , or XLV .
• 1:59
  Healthcare has actually been doing better than the S&P 500 lately as people look for growth that feels a bit safer .
• 2:07
  On the other hand , Real Estate is still feeling the heat .
• 2:10
  The Vanguard Real Estate ETF , known as VNQ , is struggling because those rate cuts are taking longer to arrive than people hoped .
• 2:20
  With the 10year Treasury yield near 4.2 percent , VNQ is expected to keep struggling unless the inflation data on Friday gives us a nice , cool surprise .
• 2:31
  As we analyze the week ahead , keep in mind that this is the end of the quarter .
• 2:36
  You might see some window dressing , which is when big fund managers buy up the quarter's winners to make their portfolios look better for their reports .
• 2:45
  This usually helps top performers like AI and big drug companies .
• 2:50
  For our trading recommendations this week , I suggest a barbell strategy to stay balanced .
• 2:56
  For your core exposure , sticking with the Vanguard Total Stock Market ETF , or VTI , is a smart allweather move .
• 3:05
  The U.S.
• 3:06
  economy is still robust , and VTI gives you the diversity to catch that endofquarter rally while protecting you if one specific sector takes a hit .
• 3:16
  If you want a more defensive play , take a look at the Health Care Select Sector SPDR Fund or UnitedHealth Group , ticker UNH .
• 3:25
  Healthcare offers a nice margin of safety if that inflation data on Friday comes in hot .
• 3:30
  UNH specifically has been looking strong on the charts lately .
• 3:34
  Don't forget to hedge your bets with a little gold .
• 3:37
  The SPDR Gold Shares , or GLD , have been hitting new highs this month as central banks around the world buy more of it .
• 3:46
  With global tensions still unresolved , GLD is a great way to protect yourself from unexpected risks .
• 3:52
  Finally , a word of caution on bonds .
• 3:55
  It is probably best to avoid the longterm bonds in TLT until we see the inflation numbers on Friday .
• 4:02
  If you need some bond exposure , stick to the Vanguard Total Bond Market ETF , or BND , which is less sensitive to the interest rate spikes we might see if inflation surprises us .
• 4:15
  To wrap it all up , keep your growth positions in the QQQ but balance them out with defensive spots in XLV and GLD .
• 4:23
  This way , you are ready for whatever the Friday afternoon data brings .
• 4:28
  Thanks for listening to Spy Trader .
• 4:31
  I am Barnaby Bull , and I will see you next time .
• 4:34
  Happy trading !