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.
8:15 am
Good Morning!
SPX futures declined to 5995.40, remaining above the 50-day Moving Average at 5988.00. Today may be the final day of reckoning in the Cycles structure. It is day 258 of the Master Cycle, but the top may have already been made on January 24, leaving equities to flounder in wide-ranging but sideways formation above the 50-day Moving Average. Today is a Cyclical Pivot day, inferring that equities may now follow the course laid out by the Cycles Model. That is, a decline to the end of March. The Pivot (down) may begin at any time this morning.
Today’s options chain shows Max Pain at 6040.00. Long gamma may begin above 6055.00 while short gamma lie beneath 6000.00.
ZeroHedge reports, “US equity futures slumped, dragged by tech following disappointing earnings from two tech giants (AMD, GOOG) and concerns that an escalation of the Trade War 2.0 will lead to negative revenue impacts for MegaCap Tech (AAPL, Mag7). Further, USPS suspends mail deliveries from China/HK as small parcels that were previously exempt from tariffs are coming under the new Executive Order; impacts about 4mm parcels per day (AMZN; Shein; Temu). As of 8:00am ET, S&P futures were down 0.4%, suggesting Wall Street’s rebound may be short-lived, while Nasdaq 100 futures dropped 0.8% as Google parent Alphabet and AMD plunged in US pre-market trading after disappointing results, and dragged the entire Mag7 lower (GOOGL -7%, AMZN -1%, AAPL -2%, MSFT -0.3%, META -0.4%, NVDA +0.4% and TSLA -1%). Bond yields slide again, dropping 6bps to 4.46%, and down some 14bps from Tuesday’s highs as rates react to the negative growth impact rather than the expected inflationary impact. The USD is weaker again and commodities mixed as goal soars to a new record high approaching $2900 while energy is sold, and Ags particularly Softs move higher. Today’s macro data focus is on ADP, Mtge Apps, and ISM-Srvcs though the Trade Balance details may pique the Market’s interest. US companies reporting results on Wednesday include Uber, Disney, Ford and Qualcomm.”
VIX futures rose to 17.75 and is consolidating inside Tuesday’s trading range. The Cycles Model suggests today may be a day of trending strength, suggesting a possible breakout. This may be followed by yet another trending strength day on Friday. The August 5 high at 65.73 makes an interesting target…
Today is options expiration for the VIX. The longs have gained some momentum, although there is no serious interest in the VIX above 30.00. Today’s expiration may release some of the hold that the shorts may have on the VIX.
TNX extended its decline toward the trendline at 44.00 on day 265 of the Master Cycle. This move forms an irregular correction, beginning under the trendline and ending above the trendline. In addition, there is a probable Head & Shoulders formation above the January 13 high telling us that yields have much further to go.
Bitcoin slipped beneath its 50-day Moving Average at 98823.51, putting it on a sell signal. Momentum may be building for a violent, but short-lived decline over the next two weeks.
USD futures are challenging the 50-day Moving Average at 107.60. This may mark the end of the correction as the trend continues higher.
Gold futures rallied to a new high at 2901.41 this morning. This may be the end of the line, as the Master Cycle is on day 261 and round number resistance may take hold. Stay alert as gold tumbles beneath the Cycle Top support at 2875.00 for an aggressive sell signal.
The Agriculture Index has burst above the declining trendline as food inflation takes center stage. The Cycles Model shows an inversion as it breaks out above the Cycle Top resistance at 404.25. A decline beneath that level signals a potential correction back toward the trendline near 380.00. The Cycles Model suggests the correction may last perhaps three weeks. This may allow accumulation of agricultural commodities during that time.
ZeroHedge remarks, “The latest wholesale data from Urner Barry shows egg prices continuing to soar to new record highs amid an ongoing and devastating avian influenza outbreak straining the nation’s egg-producing hen capacity. For ZeroHedge readers, it might be time to consider buying—or even building—a backyard chicken coop ahead of spring, as the nationwide egg shortage is poised to worsen.
Monday’s print of the Urner Barry Egg Index EBP shows prices jumped to $6.44 per dozen, a new record high and more than $1 above from two weeks ago when we informed readers about the “blue-sky breakout” in wholesale prices. ”