April 2, 2024

10:22 am

SPX has fallen beneath its Diagonal Trendline at 5220.00, giving a sell signal.  It has also challenged its Short-term support at 5189.00.   A further confirmation lies beneath Intermediate support at 5129.32.  Of critical concern is the 1987 trendline near 4900.00, beneath which lies the possibility of a greater decline.


8:15 am

Good Morning!

NDX futures have declined to 18132.60 thus far this morning as the uptrend weakens.  Critical support lies at the trendline and Intermediate support at 18019.69, beneath which lies a sell signal.  Further confirmation lies beneath the 50-day Moving Average at 17822.27.  Once the reversal is confirmed, the Cycles Model suggests a potential decline lasting until mid-May.  Of critical importance to the uptrend is the 1987 trendline which lies just beneath 14000.00.

Today’s options chain shows Maximum Investor Pain at 18275.00.  Long gamma may begin at 18300.00 while short gamma may proceed beneath 18250.00.

RealInvestmentAdvice comments, “During running bull markets, much commentary is written on why this time is different and why investors should not worry about market corrections. One such piece was written recently by Fisher Investments. To wit:

“After the S&P 500’s 26% return last year and this year’s strong start, many investors are worried – understandably – that this bull run is getting ahead of itself. “‘”


SPX futures have slipped beneath the Cycle Top support at 5231.00 for the first time since February when it also rose above the 1987 trendline.  This may justify an aggressive sell signal, although a trendline sell signal lies just beneath 5200.00 where SPX is closing in.    Intermediate support lies at 5120.97, giving further confirmation to the sell signal.  Confirmation of the larger uptrendlies at the 1987 trendline at 4900.00.

Today’s op-ex shows Max Pain at 5245.00.  Long gamma may begin at 5250.00 while short gamma may reside beneath 5225.00.

ZeroHedge reports, “US equity futures are sliding as bond yields spike to 4.36%, the highest level since November, and the price of Brent crude rises to a new five-month high above $89 driven mostly by supply/demand dynamics but a geopolitical fear premium over the brewing Israel-Iran conflict begins to build, and as fears that the Fed may not cut rates in June start to percolate. The rest of the commodities complex is also pushing higher with strength in metals notable as Ags come from sale and gold jumps right back to all time highs despite the recent strength in the dollar.  As of 7:50am, S&P and Nasdaq futures drop 0.4%, as health insurance stocks tumbled after regulators didn’t boost payments for private Medicare plans like the industry had come to expect; Mag7 names are mixed with Semis up small despite NVDA sliding. In Europe, most markets are mostly higher after reopening after the Easter holiday with only Spain in the red: energy, AI, and semis the best performing segments with additional support from banks, as regional curves bear steepen. The risk-on tone in APAC where HK showed significant outperformance. The yield curve is steeper, and the Bloomberg dollar index dropped. Bitcoin slumped after several sharp sell orders hit futures during Asian trading. Today’s macro data focus is on JOLTS and 3x Fedspeakers.”


VIX futures have risen to 14.54, giving a buy signal.  The Cycles Model suggest growing strength, especially on weekends through mid-May.  This may be due to authorities hiding bad news until the weekends, hoping that it will blow over by Monday.  The unusually low stretch of volatility may be about to end.

Tomorrow’s op-ex shows Max Pain at 14.00  Short gamma may reside at 13.00-13.50 while long gamma starts at 15.00 with outliers at 18.00 and 40.00.


TNX has broken above its February high, confirming the buy signal given last Thursday.  The Cycles Model suggests the rally may extend to the week of April 15.  A natural target may be the Cycle Top at 48.28…or higher.  Our lawmakers don’t know how to control their spending. 


Gold futurtes hit a nominal new high this morning at 2287.35 on day 246 of the current Master Cycle.  Gold may be in its final probe to all-time highs before a major correction.  Thus far there is no weakening of the uptrend.  Once the decline manifests, the nearest suport at which a signal may be given is the Cycle Top at 2167.62, approximately 5% beneath its current high.   Be aware that a change in trend may happen rather quickly.




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