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
7:45 am
Good Morning!
SPX futures made a marginal new high at 7177.20 this morning. It is in the final stage of the rally, if not already done. Corporate buybacks are opening up while hedge funds had their largest selling day in seven months on Friday. Note the red volume bar on Friday. The rally seems relentless, but the pace is slowing. A sell signal may be generated by a decline beneath the Cycle Top support/resistance line at 7130.00.
Today’s options chain shows Max pain (least payout by the dealers) at 7125.00. Long gamma prevails above 7130.00 while short gamma owns the majority beneath 7100.00.
ZeroHedge reports, “Risk sentiment improved overnight on another Axios report that Iran has given the US a new proposal to reopen the Strait of Hormuz with more detailed nuclear talks expected later.”
The premarket VIX is consolidating inside a narrow trading range after finding support at the mid-Cycle level on Friday. The Cycles Model indicated that trending strength may be on the comeback this week.
Wednesday’s options chain shows no short gamma. Long gamma begins above 18.00 and us well populated to 35.00.
The US 10-year Bond Yield may be using Intermediate support to support its rally. A boost above 43.50 may result in a probe to the neckline of the Head & Shoulders formation. The Cycles Model suggests such a boost may be imminent. The Cycles Model infers that the current Cycle may last until early June.
USD has pulled back rom its 52-day Moving Average at 98.83 on Friday and is currently beneath its mid-Cycle support/resistance at 98.55. It may consolidate for a while beneath the mid-Cycle line. However, a boost above it may reinstate the buy signal.
Bitcoin made another attempt at the former neckline before resuming its reversal. Activity this week may be muted. However, volatility may rise and a drop beneath 75000.00 may an appropriate exit point as the Cycle Model suggests a decline may ensue through mid-May.
Crude oil rose to 97.10 this morning, above the Cycle Top at 96.58, then eased back, remaining above the Cycle Top support. Should it remain above it, trending strength may emerge with a possible buying panic by mid-week.
ZeroHedge observes, “After a weekend of stalemate malaise, Iran reportedly offers new proposal for opening ship traffic, while postponing the thorny nuclear issue.”
Gold is being compressed by the Intermediate resistance at 4745.79 again this morning. The price of gold may continue to decline as long as it remains beneath resistance. The Cycles Model suggests a turn may be forthcoming, but prices may need to go lower. A panic may be brewing.