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.
10:34 am
BKX has reached its 50%retracement value at 128.59 this morning. It may overshoot to the Intermediate resistance at 129.48 before reversing. The Fed has been paying particular attention to the health of the banks. However, should interest rates (10-year) continue to rise, it may add stress to banks’ balance sheets.
8:30 am
Good Morning!
SPX futures are flat this morning. While the SPX is in the reversal window mentioned yesterday, it may linger on a flat line a few more days. It appears to be caught between the mid-Cycle resistance at 5780.45 and the 200-day Moving Average at 5754.41. The 50% retracement is at 5827.31, which may be tested in a final probe ending the Cycle. Diminished liquidity and the buy-back blackout leaves equities in a neutral position. Investors are looking for alternatives to the US equities market. Frankly, the US market has done as well as its has because overseas investors are fleeing to the US due to the poor political outlook in Europe, among other places.
Today’s options chain shows Max Pain at 5765.00 Long gamma appears above 5795.00 while short gamma strengthens beneath 5725.00.
ZeroHedge reports, “US equity futures are flat, reversing earlier losses while global markets were mixed (Europe down, Asia up) as investors awaited more clarity on US tariff plans and the economic outlook before Donald Trump’s April 2 “Liberation Day” deadline to impose a fresh reciprocal tariffs. As of 8:00am ET, S&P futures were up 0.1% following modest gains on the indexes on Tuesday, while Nasdaq futures were flat as Tesla and Nvidia shares edged lower, pressuring the Mag 7. Europe’s Stoxx 600 index dropped 0.5%. Bond yields are 1-3bp higher and USD is higher. Commodities are mostly higher led by oil and base metals. Copper futures in New York surged to a record high (up 1% now after easing off records) as traders priced in the possibility of hefty import tariffs that may come within several weeks. Headlines were mostly quiet since market close yesterday. Today’s economic calendar includes Feb durable goods orders at 8:30am; Fed speaker slate includes Kashkari (10am) and Musalem (1:10pm).”
VIX futures are higher this morning, but lingering near the mid-Cycle support/resistance at 17.63. It may touch the trendline at 16.51 before a reversal takes place.
The April 2 options expiration shows Max Pain at 18.00. While short gamma is much diminished, long gamma shows interest at 24.00.
TNX is challenging Intermediate resistance and the descending trendline ar 43.58 this morning. DOGE is “lifting rocks” to see what is hidden from public view and finding funds being paid out with no authorization. Reducing the deficit is becoming more difficult due to off-the-books outlays.
ZeroHedge observes, “In 1974, Congress created the Legal Services Corporation to connect lower-income Americans involved in civil disputes with free legal help. The law that established the agency stipulated that authorization for its funding would expire in 1980, when lawmakers were required to vote on whether to keep it alive.
They never did. Still, Congress has funded LSC every year since. In fiscal 2025, its 51st year, LSC’s 135 employees will spend 95% of its now $560 million annual budget paying legal groups to represent Americans in cases such as eviction, domestic violence, and disputes over government benefits, according to Ron Flagg, the agency’s president since 2020.”
USD continues to rise off its March 18th Master Cycle low. The Cycles Model suggests trending strength may surge higher as the Cycles Model suggests multiple significant events occurring over the next week.
Gold futures are higher this morning, as the price rises to challenge the existing high. Round number resistance at 3100.00 may be a likely target, but a surge to the trendline near 3200.00 cannot be eliminated over the next week. Gold reacts to political uncertainty and there is plenty to go around. While physical gold demand remains strong, the US Dollar is showing signs of resurgence that may stifle gold’s attraction.