7:30 am
Good Morning! Are you praying? Today is Nineveh 40 days minus 1.
SPX futures are flat this morning, with only a 10-point trading range overnight near 5300.00. The Master Cycle high may have been made yesterday, on day 258 (0n time). While many pundits think that the SPX has more rally left in it, other forces are at work to frustrate those hopes. Worldwide, stock markets have begun their declines last week with the rest poised for reversals this week.
In today’s morning options chain, Maximum pain appears at 5300.00. Long gamma rules above 5325.00 while short gamma becomes strong beneath 5250.00. The afternoon options expiry shows long gamma down to 5150.00 While this is conducive to the SPX going higher, dealers may wish to see the Max Pain level at 5150.00 for the least payout.
ZeroHedge reports, “US equity futures are flat to end a torrid week which saw all indexes hit a fresh all-time high while the terminally anachronistic Dow Jones briefly topped 40,000. Pre-market, MegaCap Tech are mixed: AMZN +20bp, MSFT +20bp, META -22bp, GOOGL -18bp. WMT is down 27bps pre-mkt, after its +7.0% rally post-earnings yesterday. As of 7:00am S&P and Nasdaq futures are unchanged while bond yields are largely flat. Commodities are mixed: oil is lower; metals/ags are higher. Overnight, China reported mixed April macro data (IP beat, Retail Sales miss) and also announced a new rescue plan to support housing; as a result base metals rallied (Copper +2.0%; Iron Ore +1.4%). Today, key macro focus will be on comments from the Fed’s Christopher Waller, Neel Kashkari and Mary Daly for further clues about the path for interest rates as well as the data from the leading index due at 10:00am (est -0.3%).”
VIX futures made a new morning low at 12.26. Today is day 274 in the very stretched Master Cycle. The VIX is a small index and is heavily influenced by the larger markets. Over the past 4 years VIX has had multiple readings in the 270s. VIX has become incredibly quiet. Hedging is heavy in both directions. A reset may be dramatic.
The May 22 options chain shows Max pain at 15.50. Short gamma is incredibly strong between 12.00 and 15.00. Long gamma begins at 16.00 and shows strength to 60.00.
USD futures have risen above the 50-day Moving Average at 104.59. It may pull back in a consolidation, but note that it is on a buy signal. It made its Master Cycle low on Wednesday and the Cycles Model suggests a rally to mid-June.
TNX futures are climbing this morning to a high of 44.02 thus far. The 50-day Moving Average is at 44.10, where a confirmed buy signal awaits. Yesterday’s low at 43.18 appears to have ended the Master Cycle on day 258. TNX has the potential to rally to early July, almost two months.
https://www.investing.com/currencies/us-dollar-index