The Lord’s Prayer
Our Father, who art in heaven, hallowed be thy name. Thy Kingdom come, Thy Will be done, on earth as it is in heaven. Give us this day our daily bread and forgive us our trespasses, as we forgive those who trespass against us. And lead us not into temptation, but deliver us from evil. Amen
7:45 am
Good Morning!
SPX futures have marched higher, to 7580.30 thus far this morning. It is now in throw-over mode, suggesting a final push above trendline resistance. It has reached day 60, a Trading Cycle, from the March 30 low. This is equivalent to the 61-day decline from the January 28 high to the March 30 low. Trading Cycles have their own timing that often corresponds more to the calendar year than the larger Master Cycles. However, when they match, they may provide more accurate guidance. In this case, the Trading Cycle may have overridden the Master Cycle and may not match in June. Investors are now in full panic mode, trying not to miss out on the rally. Can anything go wrong?
Today’s options chain shows Max pain at 7545.00. Long gamma dwells above 7550.00 while short gamma strengthens beneath 7500.00. Investors are walking away from protective puts in favor of long calls.
ZeroHedge remarks, “Nearly two months of the national average gasoline price exceeding the politically sensitive $4-per-gallon level have left corporate America increasingly worried about consumer health this earnings season. Kraft Heinz’s CEO warned that some households are “literally running out of money,” while UBS analysts caution that even as the AI-linked chip and memory bubble inflates markets to new highs, there are growing “consumer cracks beneath the surface.””
ZeroHedge reports, “US equity futures are higher, continuing their slow motion-gamma squeeze into record territory, as traders waited to see whether America and Iran could finally get the peace deal they have already priced in every single day for the past month.”
The premarket VIX is holding its own as it consolidates above yesterday’s proposed Master Cycle low. This final extension is running out of time. Investors are selling protection where it may be needed the most.
The June 2 options chain shows virtually no short gamma. Long gamma runs from 17.00 to 30.00, suggesting that speculators are not very afraid.
The 10-year Bond Yield may be on its final approach to a Cycle Bottom near the 52-day Moving Average at 43.83. The breakout last week may have changed the outlook for TNX. Before the breakout, the probable downside target would have been the mid-cycle support at 41.94. While that is still possible, the more likely Master Cycle low may be higher, as the strength is more attuned to the upside. A breakout of the new Head & Shoulders formation may occur by mid-June.
ZeroHedge observes, “In the week’s final coupon auction, the US Treasury sold $44 billion in 7 Year notes to stellar demand.
Extending on the strength yesterday’s solid (if tailing) 5 Year auction, today’s 7 Year sale printed at a high yield of 4.290%, up from 4.175% and the highest since Jan 2025. It also stopped through the When Issued 4.291% by 0.1bps, the first stop through since December 2025.”
USD may be easing back to find support at the mid-cycle level at 98.64 as lower bond rates take away some of the attraction to the USD. However, the current Master Cycle has nearly run its course and may reverse higher from that low. In fact, the Cycles Model implies a possible explosive move from a low that may be complete by mid-week.
Bitcoin may be consolidating above its Master Cycle low achieved yesterday. The Cycles Model suggests a possible month-long rally that may reach the Cycle Top near 97413.10. The rally in bitcoin may have more to do with deteriorating economics overseas than any particular attraction domestically.
Crude oil continues its decline toward the Triangle trendline, where it may bounce violently. However, that may not be the end of the decline. The Cycles Model anticipates a final probe beneath the trendline by mid-June.
ZeroHedge maintains, “Just about two months ago, JPMorgan did the math on “How Long Before The World Hits Crude Oil Operational Minimum.” The punchline was that while the market can hold hundreds of millions of barrels, it would still become fragile once working stocks fell too low. Like blood pressure in the human body, the issue is circulation.”
Gold emerged from beneath mid-Cycle support at 4455.24, but the bounce may not last. The Cycles Model suggests a panic surprise may await gold investors this weekend. A low at the Cycle Bottom is possible as central banks unload their gold in favor of oil. What looks like capitulation may be a false flag.
The Agricultural Index is fast approaching its master Cycle low. It is less than2% from the mid-Cycle support which may mark the bottom of this decline in a matter of days. While AI stocks are attracting the masses, a more critical investment is emerging as food prices may skyrocket with the knowledge of a poor harvest season.
ZeroHedge remarks, “Tyson Foods CEO Donnie King is stepping down after five years at the helm of the nation’s largest meatpacker, with the stock having languished under his tenure as the company battled some of the worst cattle-market conditions in a generation.
Jeff Schomburger, a long-time Tyson board member, will become president and CEO on October 4. King, a 43-year Tyson veteran, will remain on the board and help with the transition beginning in July.”
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