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.
7:50 am
Good Morning!
SPX futures ar hovering between 6299.00 and 6317.00 this morning, in anticipation of $2.8 trillion of notional options expiring today. Currently the sentiment is pretty evenly divided between puts and calls with 6300.00 in dead center. The Cycles Model does not anticipate any big moves in either direction. However, the wild card may be the high percentage of 0DTE players awaiting on the sidelines. Calls fall off precipitously above 6350.00, while the puts may be the land mine. There is a worry about a major shift in gamma exposure.
Today’s morning options chain shows Max Pain at 6300.00. Long gamma resides from 6315.00 to 6350.00. Short gamma starts at 6260.00 with a long tail lower.
ZeroHedge reports, “US equity futures are flat even as the global equity rally extended into Europe, following Friday’s gains in Asia and Thursday’s record close on Wall Street. As of 8:00am, S&P futures are unchanged while Nasdaq 100 futures rise 0.1% after NFLX had a solid report, but market reactions were muted amid high expectations. Europe’s Stoxx 600 initially rose 0.4% but has since erased gains, with Energy stocks outperforming and tracking a two-day advance in oil prices as Brent crude futures climb 1.2% to above $70 per barrel. Pre-market in the US, megacap tech sees NVDA up modestly (+0.4%), followed by AAPL and GOOGL. Consumer Staples and Financials are outperforming. The dollar and 2Y rates dropped after Fed Governor Christopher Waller repeated his recent view that the Fed should cut 25bps this month. Yields are lower and USD is weaker; 2-, 5-, 10-, and 30-year yields are down by 1-2bps. Commodities are mixed, with Oil and Precious Metals higher, while Base Metals are flat. The combined value of cryptoassets soared beyond $4 trillion for the first time, fueled by a surge in Ethereum and momentum from a legislative push to regulate the sector. Looking at today’s calendar, the US economic data slate includes June housing starts (8:30am) and July preliminary University of Michigan sentiment (10am). Fed speaker slate includes only Waller, and Fed officials’ external communications blackout ahead of their July 30 decision starts Saturday”
VIX futures declined to 16.41, testing its “floor.” The Master Cycle low occurred on July 10 and there is little reason to extend beyond today, if at all. The Cycles Model anticipates a rally in the VIX lasting to late August. Trending strength appears next week. Today is a good day to accumulate shares.
TNX is drifting lower, with the possibility of reaching the 50-da Moving Average at 44.06 today. There is a volatility ticking time bomb waiting today. A distinct possibility may be a phase reversal, which may allow the TNX to go much higher. Should it do so, TNX may be on the ascendancy through mid-September.
USD futures are pulling back to test Intermediate support at 98.09 or the trendline at or just below 98.00. The Cycles Model also calls for a powerful move by day’s end, which may allow the USD to launch higher over the next three weeks.
Bitcoin futures are moving higher. The current trend may last another two weeks, according to the Cycles Model. Bitcoin is one of the most favored investments in times of stress. In Europe, the drums of war are beating louder, while the Bank of Japan is in crisis mode this weekend. There is little wonder that Bitcoin is going higher.