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
11:55 am
The BKX has fallen beneath its Cycle Top support at 175.00. This may be an aggressive sell signal for those who are informed. Additional support may be found at 169.00 and again at 166.12. A decline beneath these supports may strengthen the sell signal. An aggressive sell signal suggests a reduction of long exposure to the banking sector.
8:10 am
Good Morning!
SPX futures have been consolidating between 6934.00 and and 6967.00 this morning. While not immediately threatening, pressure may be building for a downside break by the weekend. Best to prepare before it happens, as it may be a strong decline. Mutual fund cash is at its lowest, while many investors are leveraged long. This may not be a dip that will be bought. Expect a negative employment surprise as the BLM revises its Birth-Death Model.
Today’s options chain shows Max Pain at 6960.00. Long gamma may emerge above 6975.00 while short gamma resides beneath 6910.00.
ZeroHedge reports, “US equity futures are flat ahead of today’s delayed January payrolls (full preview here) with the market now expecting a weaker print after the Retail Sales miss and weaker high-frequency data.”
The premarket VIX has risen to 18.35 thuse far this morning, advancing from yesterday’s low at the mid-Cycle support at 17.18. The Cycles Model suggests a possible breakout above resistance by early next week, if not sooner.
Next Wednesday’s (February 18) monthly options chain shows monster short gamma between 15.00 and 18.50. Long gamma is strongest between 20.00 and 50.00 with outlier positions to 100.00.
TNX rallied off its morning low at 41.25 , rising to the neckline of the Head & Shoulders formation at 42.05. It has risen above the 52-day Moving Average at 41.73 and is challenging the Intermediate resistance at 41.98. Above these levels is a buy signal.
ZeroHedge remarks, “Eight weeks. $90 billion in Treasury bill purchases. And that’s just the appetizer. There’s $9 trillion in rollovers coming due at today’s rates, plus another $2 trillion in new issuance. That’s $11 trillion the US needs to find buyers for while China dumps Treasuries and Japanese capital flows home.”
USD may have completed its mid-Cycle low, ready for a probe higher. An attempt at overhead resistance starting at 98.03 may be in the works. This may lead to a consolidation before breaking out above resistance. The Cycles Model suggests a breakout may be possible early next week.
Bitcoin continues its descent as it corrects the bounce from its February 6 low. The decline may gain some momentum as the bears “sell the rally.” The Cycles Model suggests the bottom may be in, but this may be a retest.
Silver may have completed its test of Intermediate resistance at 85.56 and may decline to test the low. Silver may remain in a corrective state until it breaks out above the Cycle Top resistance at 88.85. The Cycles Model indicates that the correction may last another week before clarity returns.