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”
11:15 am
The minimum target for the SPX Head & Shoulders formation has been met, but there may be more downside to go. A bounce is not out of the question, but this weekend is fraught with peril in the Middle East and private credit.
3:45 pm
We may see a bounce near 6350.00, but the decline may not be over today.
7:40 am
Good Morning!
SPX futures consolidated near 6500.00 in the overnight market, then began to decline to 6444.00, short of the Head & Shoulders minimum target. Beneath it lies the Cycle Bottom at 6246.17. The gradual erosion is starting to accelerate. It appears likely that the decline may terminate close to the 1987 trendline, near 6200.00. From that point, we may see a consolidation lasting several weeks, as shorts are being covered. The bear market is not over, but may have a short rest.
Today’s options chain shows Max Pain at 6550.00. Long gamma begins above 6575.00 while short gamma becomes strong beneath 6525.00. there are substantial put walls at 6400.00 and 6300.00.
ZeroHedge reports, “Futures are sharply lower, erasing modest overnight gains and trading near session lows as Brent crude futures are back above $110 a barrel after erasing an earlier fall and knocking broader risk sentiment off course in the process.”
The premarket VIX rose to 29.84 this morning as patience wears thin on the war in the Middle East drags on. Losses are starting to alarm investors looking for a way to alleviate the pain. However, Wall Street advisors are cautioning against hedging, as the envision a bottom nearby.
The April 1 options chain shoes Max Pain near 25.00. Short gamma is building beneath 24.00 while long gamma becomes very strong above 28.00.
The US 10-year Bond Yield gapped up to 44.66 this morning, above the “Cycle Top resistance at 44.20. 45.00 is in sight today, but a pullback may be in order. With that there is a potential of adjusting the neckline of the head & Shoulders higher. We may allow the subsequent correction to allow guidance, as there may be 1-2 weeks of back-filling.
USD is moving cautiously higher, as it prepares a potential breakout over the weekend. It may reach 101.50-102.00 by early next week before a consolidation lasting about two weeks.
Bitcoin fell substantially this morning and may end lower by the end of the day. Today the Cycles model shows a double dose of (down)trending strength. The February low may afford some support for a bounce. Soaring oil costs must be met to keep economies afloat, causing liquidation of bitcoin.
Silver declined to 67.50 this morning, in a possible resumption of the decline. There may be 1-2 more weeks in the decline with 45.00-50.00 as a possible support.
Gold is consolidating in place this morning, with up to 2 weeks of decline left. A possible target may be 3800.00.