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 rose to test the 52-day Moving Average at 7607.17 this morning without ectending the decline in the overnight session. A rise above the 52-day offers a buy signal for the SPX. NDX appears to be in a similar position, beneath its 52-day Moving Average at 29191.00. All eyes are on the Fed this morning with the consensus of a possible .25% rate hike.
ZeroHedge reports, “Futures are higher into Fed Day where consensus is for a 25bp hike, the first since July 2023, with unknown levels of communication, and the question is what the dot plot shows (see preview here). S&P 500 futures are up by 0.3%, finding relief after days of selling as traders wait Kevin Warsh to deliver an expected interest-rate hike that will help ease fears that inflation may spiral.”
The premarket VIX held fast at yesterday’s low at 16.79. The Cycles Model allows three more weeks of decline toward the bottom trendline of the Ending Diagonal (wedge) formation. The target appears to be near 12.50, but it may probe lower, approaching the Cycle Bottom.
The US 10-year Bond Yield has slipped back beneath 50.00 this morning after making a marginal new high yesterday. The bond market awaits the FOMC news release to see how serious Warsh is about containing inflation.
The US Dollar paused at its high, awaiting the outcome of the FOMC news release. While there is the possibility of testing supports at 99.40 and 99.22, the trend is still higher. The weekend may bring a surge in trending strength to the USD.
Crude oil futures have pulled back as it tests suport, possibly near 101.00. The Cycles Model implies the uptrend may resume by the weekend in strength. The Cycle Top resistance at 112.11 may be the next target. Keep in mind that there may be a month left in the rally, suggesting the February high may be the next target after a brief correction.
ZeroHedge remarks, “Diesel futures and refining spreads climbed to record highs as worsening supply disruptions in the Gulf and Russia tightened availability of the industrial fuel that powers the global economy.”
Gold has bounced from its 52-day Moving Average this morning, ending the prior Master Cycle and beginning a new one. The new Mster Cycle may last a month in a corrective rally. Short term resistance may be found near the Intermediate level at 4376.00 while longer term resistance lies at the mid-Cycle level at 4554.70.
The Ag Index may be rising from its swing low. While it may venture lower, the bounce may qualify as a double reversal Cycle low, as it may happen in a two-week span. The irony is that food rices may resume a substantial rise to the Thanksgiving holiday.
ZeroHedge remarks, “Following last month’s ugly decline (“see the consumer is getting crushed because of Trump”), August’s retail sales is expected to rebound strongly…”
Bitcoin has resumed its decline, challenging Intermediate support at 75638.00. The Short term outlook may be neutral, but be aware that the 52-day Moving Average is at 71582.00 and rising. The aggressive sell signal remains pendig a decline beneath the 52-day Moving Average.