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 may be having a strong up day today. If so, a bounce may extend to Intermediate resistance and the trendline at 160.46. The Middle East news seems to be dominant, so investors are looking for what may be trending positively, or at least not declining. Should BKX rise above the mid-Cycle resistance at 154.40, then the trendline may come into view as the next resistance. Apollo and Ares are two private credit funds that have gated investor liquidations. There will be more liquidations as rising interest rates are eroding returns on private credit. Somehow, this doesn’t reflect on bank loan quality, yet.
7:50 am
Good Morning!
SPX closed right at short-term support/resistance at 6581.00 yesterday. The overnight session futures rose to 6605.00, then dropped to 6531.90 this morning. It remains hovering beneath that resistance this morning. This activity supports a resumption of the decline, or possibly a sideways consolidation. Commentators insist that SPX remains rangebound. However, the bottom of the 4-month “range” is the neckline at 6710.00. Poor analysis is causing confusion as there seems to be no consensus in terms. They may wish to dust off the venerable “Technical Analysis of Stock Trends” for reference. In the meantime, the Cycles Mode may offer another week of serious decline before a significant bounce. Calling the bottom this week may be an exercise in futility.
Today’s options chain shows short gamma beneath 6600.00, a warning sign that the bears may still be in control of the options market.
ZeroHedge reports, “Futures are lower but well off session lows, as overnight headlines induced another bout of aggressive choppiness: those headlines include strikes on Iranian gas facilities, Saudi and UAE considering entering the war, Iranian lawmaker ruling out US negotiations, and then reports of Iran / Egypt discussions on the region pointing toward mediation.”
The premarket VIX remains above the 52-Day Moving Average at 23.93 this morning after completing its correction. It is also above its Cycle Top at 23.93, offering a buy signal for those who trade the VIX. Should the VIX rise above the neckline at 25.30, it may follow through to its intended target by the end of the current Master Cycle.
The US 10-year Bond Yield is pushing higher after testing the Cycle Top resistance at 44.12. The downtrend line is broken. A breakout above the Cycle Top may rise to 44.50-45.00 in the next week before a pullback. TNX is on a long Master Cycle that may challenge the October 2023 high at 49.97 by June.
1:30 pm
ZeroHedge reports, “With both foreign and domestic investors dumping gold (and anything else not nailed down) to fund oil, at its brand sparkling new price of $170 (in Asia), we were wondering how long before the lack of disposable cash hits US debt. We got the answer today at just after 1pm when we got the results of today’s $69 billion 2Year bond auction. In a nutshell, it was terrible.”
The USD bounced near its 200-day Moving Average at 98.45 and may continue higher. The Cycles Model suggests a possible resumption of the rally until mid-April.
Bitcoin may have completed a near 50% retracement of last week’s decline yesterday and may be poised for a more serious decline. The Cycles Model reveals a possible panic developing toward the end of the week. A decline beneath the 52-day Moving Average at 69075 may confirm that outlook.
Crude oil is consolidating in the mid-range of yesterday’s 17% move in one day. The consolidation may continue for the next week, perhaps a triangle formation, before declining further. Activity on this decline may pick up in early April (boots on the ground?), as the decline may test the Intermediate support at 76.02, then the 52-day Moving Average at 70.76, or possibly lower. However, pressure is building for a blowout to follow.
Gold’s panic decline may be over, with a bounce forming. It bounced to 4482.74 in the overnight session and may consolidate for the next week after Monday’s record decline. The outlook for April is murky, but negative. Supports may be found at 4000.00, 3800.00 and 3600.00. Possibly lower. Once the correction is complete, gold may resume its rally for another two years.
Silver remains somewhat range-bound after Thursday’s panic. There may be another 2 weeks of decline left in the current Master Cycle with the mid-Cycle offering support for a possible bounce at 58.50. Beyond that, support for a bottom may be found near 45.00 by mid-April.