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.
11:33 am
SPX has made its reversal by declining beneath 6050.00, in agreement with the Cycles Model. While a confirmed sell signal may be made beneath the 50-day Moving Average at 5998.00, an aggressive sell may be assumed. It is time to reduce long exposure.
7:45 am
Good Morning!
SPX futures remain flat this morning, awaiting the January BLS Employment Situation Survey. Continuing claims appear little changed, while the anticipated benchmark revisions may have some big surprises. The Cycles Model may allow a new all-time high today, with a reversal to follow. The January 24 high was a bit early for the Master Cycle. Should it elect to make a new high today, it would be on day 260. Retail investors are steamrolling bearish hedge funds and institutions, buying every dip that the market presents in volume not seen before. Of course, the sell signal lies beneath the 50-day Moving Average at 5997.54. There may be a big surprise in either/;both directions.
Today’s options chain shows Max Pain at 6050.00. Long gamma may begin at 6075.00 while short gamma resides beneath 6000.00.
Zerohedge reports, “US equity futures are unchanged, with tech lagging and small caps leading as traders hunker down ahead of a payrolls report that is expected to show 175,000 new workers but will also be dramatically revised. As of 8:00am ET, S&P futures are flat with the index on track for a 0.7% weekly advance; Nasdaq futures are down 0.1%, with Mag 7 mostly lower after AMZN’s earnings disappointment last night (AMZN -2.6%; TSLA -1.5%; NVDA -0.9%); the e-commerce and cloud-computing company gave an outlook that was weaker than expected. Meanwhile, there seems to be no stopping Meta as the social networking giant is on track to extend gains for a record 15th consecutive session. Bond yields are largely flat; USD unchanged. Commodities are mostly higher led by oil (+0.8%). Today, the key macro focus will be NFP (a full scenario analysis from JPM and Goldman can be found here): the Street’s estimate is 175k; a step down from last month’s 256k print. For the unemployment rate the Street expects 4.1%. ”
VIX futures are consolidating near the low. It may have reached its “floor” that may prove to be support for today’s launch. A jolt of trending strength ma appear today as investors may begin hedging again.
The February 12 options chain shows Max Pain at 17.00. While there are few puts, calls are showing investor interest up to 30.00.
USD futures are consolidating above the 50-day Moving Average at 107.61, creating a possible buy signal. While today may appear calm, the Cycle Model suggests a triple dose of new trending strength next week. This buy signal is worth taking seriously.
Investing.com reports, “TOKYO/LONDON (Reuters) -The U.S. dollar edged higher on Friday ahead of key U.S. payroll figures later in the day, after the yen climbed to a nine-week high as market players piled on bets for more interest rate hikes in Japan.”
The Japanese Yen has leaped above the 50-day Moving Average at 64.64 and is now above mid-Cycle support at 65.62. The Cycles Model suggests a rally in the Yen to mid-March. Note the Yen and the USD are both rising. This may put an end to the Yen carry trade.
8:37 am
TNX extended its Master Cycle low this morning, on day 267. It has subsequently reversed, challenging the 50-day Moving Average at 44.80 after the release of the January payrolls report. The Cycles Model suggests TNX may rally through the end of March. Note the potential Head & Shoulders formation.