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.
8:00 am
Please note: I may be absent from the blog over the next week for personal reasons. Comments, if any, may be brief.
Good Morning!
SPX futures declined to 7451.40 this morning, anticipating the market will be closed today (Juneteenth). Intermediate support at 7436.88 held, allowing SPX to challenge the Cycle Top at 7484.65 after monthly options expiration day. The Space-X IPO and Kevin Warsh’s influence in the Fed have taken some of the wind out of the market’s sail. Despite waning liquidity, equities appear to be the only game in town at this time. The Cycles Model suggests next week’s probe may be higher with a possible target near 7750.00. Should it go higher, a blow-of top may be indicated. High market strength may be expressed over the next week. Alternatively, a decline beneath 7400.00 may be a bearish warning that all is not well.
June monthly options expiration may be held on Monday. While on balance bullish, a large number of call options may be dropping off, leaving the SPX in a more delicate state.
ZeroHedge reports, “Update: the Yo-Yo insanity that is the on again, off again Iran war. Moments after we reported that futures and global risk assets had sold off overnight on a delay to today’s start of peace talks in Switzerland due to Iran’s protest of ongoing violence in Lebanon, moments ago Reuters reported that Israel and Hezbollah have agreed to a ceasefire set to begin at 4 p.m. local time on Friday, citing a senior US official.”
The premarket VIX is consolidating, remaining neutral going into the weekend. The Cycles Model indicates calm ahead, suggesting there is no desire to hedge at this time. The tranquil outlook may allow the VIX to decline beneath the lower Triangle trendline, possibly matching or exceeding the December low over the next two weeks.
The US 10-year Bond Yield futures rose to 44.88 this morning. However, the market is closed today, so I am showing the weekly chart showing the 2.5 year Triangle formation. The Cycles Model indicates that TNX may decline to the lower Triangle trendline near 40.00 by mid-July. It may begin its slope downward as early as this weekend. That infers both stocks and bonds may rise together in the immediate future.
USD futures rose this morning (not affected by the market closure). It has broken above the neckline of the proposed Head & Shoulders formation. The Cycles Model indicates the current Master Cycle has not yet finished, and may do so in strength. The dollar shorts may be covering, with a possible panic ensuing.to ensue.
Bitcoin has becalmed somewhat after yesterday’s rout. However, there may be little comfort for the longs, as the decline may resume, with force, this weekend. The minimum target for this formation may be near 50000.00. However, the larger picture shows a possible bearish Cup-With-Handle formation with a much deeper possible outcome.
Crude oil futures retested yesterday’s low, which held at 73.58. It has since gone higher, confirming the Master Cycle low. Despite the long tail and negative appearance, the Triangle formation is a bullish formation. A possible minimum target may be near 130.00. Further analysis may produce a higher outcome.
ZeroHedge observes, “Oil prices are on track to close lower for the week, with WTI futures down more than 9% versus last Friday’s close after the US and Iran secured an interim peace deal to reopen the Strait of Hormuz.”
Gold futures fell lower this morning, as it may resume its decline. The Cycles Model indicates a possible decrease in price targeting the Cycle Bottom at 3732.42 by mid-July. While gold is a store of value in normal times , oil has a greater immediate need by many countries across the globe.