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.
3:30 pm
SPX may have completed its last fractal, or very nearly so. Prepare for an imminent reversal. An aggressive sell signal may be activated beneath 6100.00.
8:00 am
Good Morning!
SPX futures rose to 6138.40 this morning, then eased back beneath yesterday’s high at 6129.63, a new all-time high. Note that yesterday was day 271 of the current Master Cycle. Usually the Master Cycles end within two weeks of day 258. Should SPX go higher today, it will have extended 14 days. Yesterday I mentioned that SPX may make a final probe to 6160.00. However, time is running out. A sell signal may be made beneath the 50-day Moving Average at 6002.00.
Today’s options chain shows Max Pain at 6115.00. Long gamma may begin at 6150.00, while short gamma may start at 6050.00.
ZeroHedge reports, “US equity futures are lower ahead of today’s FOMC minutes, with global markets also sinking and bonds extended their slide after President Trump’s latest tariff threats stoked concern about a widening trade war; hawkish UK inflation prints which sent bond yields higher did not help. As of 8:00am S&P futures are -0.3% lower after the index topped its January record on Tuesday, while Nasdaq futures traded steady after Trump raised the specter of 25% tariffs on Autos and Pharma, both coming after April 1. The Trump Admin will also keep Biden-era rules on M&A. A slew of earnings reports also dented sentiment, with Arista Networks, Occidental Petroleum, Celanese and Bumble all dropping in premarket trading after results. Super Micro Computer rallied, however, after issuing an aggressive long-term revenue outlook. Pre-mkt, Mag7 names are mixed with Semis seeing some profit-taking. The yield curve is twisting steeper as the USD appreciates. Commodities are stronger despite the USD move; Brent trades above $76 while gold is at an all time high around $2940. Today’s macro data focus will be on Housing data and the Fed Minutes.”
VIX futures rose to 15.62, within the existing trading range. The 50-day Moving Average is at 16.36. A buy signal awaits above that level. As an alternate, the mid-Cycle resistance at 16.53 may also be used as a buy signal. The release of the FOMC minutes may be a catalyst for a spike in hedging. In addition a debt ceiling standoff looms in mid-March. The perceived “stability” cannot last.
Today is the monthly options expiration for the VIX. Max Pain lies near 20.00. Short gamma lies between 15.00 and 19.00. Long gamma is populated from 20.00 to 85.00.
TNX futures rose to 45.78 this morning, while the cash market lags. Intermediate resistance lies at 45.95. Once clear of that, the Cycle Top at 48.15 may be in sight. Trending strength is at work today and may intensify next week as congress plays chicken with the debt ceiling in March.
Bitcoin may have broken it trendline with a possible three weeks left in the Cycle. This may be considered a sell signal, especially since it is beneath the 50-day Moving Average at 98941.00. Once the trendline is broken, the next support may be the mid-Cycle level at 82300.00.
Gold futures are trading beneath the February 11 high at 2968.50, but is being supported at the Cycle Top at 2912.40. Once a breakdown occurs, we may see gold plummet to its trendline at 2730.00. or lower. The uptrend may be complete, but the decline is not yet underway. Should gold close beneath 2912.00, on may wish to lighten up one’s gold holdings. The Cycles Model suggests that, once underway, the decline may last through the end of March. Analysts continue to flog gold as an inflation hedge. However, there may be a closer link to political instability, instead. Should the political arena calm down, especially in war zones, we may see a dramatic drop in the price of gold.