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.
8:15 am
Good Morning!
SPX futures have been hovering beneaath 7700.00 this morning, suggesting a brief test of the low, possibly to 7680.00 this morning. That action would give the current Fractal a 21-day profile, allowing SPX another possible 21 days left to make its final ATH. 8000.00 may be in view, but it may be a struggle to get there. Breadth is declining, with investors chasing the latest hiccup, with no rational theme.
ZeroHedge reports, “Futures are flat but off their lows as Tech gets a boost from a huge Hynix buyback, which erased ~8% decline to trade up as much as 2% and reversed a 5.8% drop in the Nikkei; the ADRs are +5.6% pre-mkt boosting both Memory and Korea ETFs.”
The premarket VIX is consolidating above the Triangle formation as it organizes a move toward the Ending Diagonal trendline near 20.00. Investors are going long and buying protection at the same time. The Cycles Model maintains that confidence will rise toward the end of the month as the SPX refuses tocorrect. They will then discard their hedges as the SPX approaches 8000.00.
The US 10-year Bond Yield plummeted to a low of 46.33 this morning in a complex correction that may decline to the 52-day Moving Average at 45.70 by the end of the month. The breakout failed by a mere tick. Long bonds may get a brief reprieve. The weekly chart shows a possible Cup with Handle formation with a possible target near 60.00. The rise in Treasury yields may eventually make the interest payments unsustainable.
USD is extending its Master Cycle beneath the mid-Cycle support at 99.13. The extension puts the Master Cycle into overtime, suggesting an imminent reversal. A rise above the mmid-Cycle level may offer a buy signal.
Crude oil is consolidating just beneath the declining Triangle trendline near 86.50. A breakout may extend the rally and serve as a pullback support. Otherwise, a dip to Intermediate support at 80.25 may offer a platform for a surge of strength next week.
ZeroHedge observes, “Brent at $90.94 looks almost civilized. Jeff Currie thinks that is exactly the problem: everyone is staring at crude while the real energy shock is already showing up in the fuels people actually buy.”
Gold is approaching its mid-Cycle resistance at 4531.39 where a possible reversal awaits. With Bessent’s QE attempt, the complex Triangle formation morphed into a simple zigzag formatiion that is nearing its end. The rally remains corrective, with a significant decline to follow.
ZeroHedge remarks, “The reason for today’s rally is Secretary of the Treasury Scott Bessent said that the US would be buying back more bonds further out on the curve.”
The Ag Index continues its ascent after the breakout above the neckline of the head & Shoulders formation. While the rally may not be complete, GKX has become extended with a potential rising of a pullback to the neckline. There are only a couple of weeks left in the current Master Cycle, leading to a neutral stance for the time to the pullback.