9:00 am 2 Chronicles 7:14
“If my people, which are called by my name, shall humble themselves, and pray, and seek face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sins, and will heal their land.”
Good Morning! I am recovering from the flu and running late. Please excuse me.
SPX futures have come down to a morning low of 5513.00. Intermediate support lies at 5475.00, so we may see a further pullback. Once SPX completes its pullback, overhead resistance liews at the Cycle Top at 5702.12. Yesterday I estimated the running target for this rally at 5780.00. Usually the Cycle Top resistance may prevail in ending this trend. The Cycles Model suggests about a week to 10 days may be left to make a top.
Today’s options chain suggests Maximum Investor Pain at 5530.00. Long gamma may begin at 5550.00 while short gamma may start beneath 5500.00.
ZeroHedge reports, “US equity futures erased earlier gains and were trading with modest losses as dollar, oil and yields all slumped entering the US session. As of 7:45am, S&P futures traded down 0.1% around 5,562 as consistent selling pressure emerged around the European open, even as Asian stocks had another solid session. Nasdaq futures were unchanged, with megacap tech mostly higher led by NVDA +56bp, and AMZN +60bp. Bond yields and USD are both lower; 2-, 5-, 10-yr yields are 2bp, 5bp, 10bp lower, pulled down by a sharp drop in oil as the Harris oil trading desk resumes shorting. Other commodities were mixed with base metals higher. Today, the key macro focus will be U of Mich Sentiment and housing data (Housing Starts and Building Permits).”
VIX futures challenged the 50-day Moving Average at 15.67 this morning before pulling back beneath it. Should it close above that level, a buy signal may be confirmed. From this point on, the VIX may be the only index in which to buy the dip. While the Master Cycle low may have occurred early, it may set into motion a rising VIX phenomenon until the end of September. The Cycles Model suggest a surge of trending strength may begin this weekend.
TNX is in pullback mode after testing the trading channel trendline at 39.50. It is on a buy signal (sell UST) and may continue rising during the next 3-4 weeks. Fireworks may develop as trending strength multiplies near the end of August. Next week’s Treasury auctions may better inform us as to the the direction of TNX.