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 continued to rise to 7780.60 this morning, possibly on its way to 7800.00, where there may be short-term resistance. Thereafter, the equities Cycle remains uneventful to the end of the month. Whether it maks a new all-time high in September may be questionable. However, the Cycle picks up activity in October. The Short squeeze may be over and retail buying may be fading as the market may be waiting for new money to arrive. The target remains near 7970.00 to above 8000.00.
ZeroHedge reports, “Futures are flat, having recoverd a modest drop after the European open, following yesterday’s strong, positive performance despite energy prices and yields being lower for a second consecutive day.”
The premarket VIX is consolidating beneath the Triangle trendline near 15.00. The Cycles Model calls for a sideways-to-lower glidepath over the next week. The lower trendline of the short-term trading channel lies near 13.00 and may decline to 12.50 in the next couple of weeks.
The US 10-year Bond Yield broke beneath its consolidation zone nd declined to 10.23 this morning. It may bounce temporarily at the Cycle Top at 49.05. However, the decline may resume later this week with growing downside momentum. The decline may have two more weeks to go with a possible target near the 52-day Moving Average at 47.27 or the trendline near 47.00.
The US Dollar Index may be losing some of its upside momentum after making a high at 100.67 this morning. A retest of the 52-day Moving Average at 99.92 may be in order for the rest of the week. Trending strength may not arrive until early October.
Crude oil declined to 89.16 thid morning, setting up a potential bounce at Intermediate support at 88.92. Should the bounce occur, the uptrend may regain its strength by the weekend. A Head & Shoulders formation may have emerged in the past week that may clarify the direction of crude oil over the next six months.
ZeroHedge observes, “UBS analysts warned that the global diesel squeeze could get worse as two major suppliers potentially pull barrels from an already strained petroleum products market. Russia may extend diesel export restrictions through October, while chatter in Washington about a US fuel export ban continues to grow.”
Gold bounced at the 52-day Moving Average at 4284.00 this morning. This action may reinforce the potential for gold to move higher. Trending strength may come into play later this week, sending gold to test the mid-Cycle resistance at 4552.31. Should it exceed that level, a higher rally may result.
The Ag Index challenged the Cycle top at 429.27 this morning before pulling back. Once above it, a buy signal may be made with the neckline of the Head & Shoulders formation in sight. The current master Cycle is a long one, lasting to the end of November. The likelihood of making that target is substantial.
ZeroHedge observes, “As Donald Trump’s war on Iran nears the seven-month mark, the economic damage is reverberating all over the world, and all across the United States. Among the Americans who are feeling the most pain from a war their federal legislators never declared are the nation’s farmers, who are growing increasingly desperate under the weight of rising costs for diesel, fertilizer and equipment.”
ZeroHedge notes, “The shift happened gradually, then all at once.
By late 2024, analysts at Langley and Fort Meade who had spent careers tracking terrorist cells and nuclear programs found themselves redirected to spreadsheets showing fertilizer shipments, satellite passes over Ukrainian wheat fields, and soil moisture readings from the Sahel. Nobody had issued a memo announcing the change.”
BKX, the Banking Index, may be continuing its decline to the mid-Cycle support at 172.97 this week. Should it hold, a brief bounce may be generated. A lack of support at that level may allow the BKX to decline to its Ending Diagonal trendline near 163.00. With little fanfare, liquidity is draining out of the economy.
Bitcoin has pulled back from yesterday’s high at 87336.00 and may be consolidating above its Cycle Top support at 84993.00. While Bitcoin may go higher, a decline beneath the Cycle Top may produce an aggressive sell signal. A further decline beneath the trendline at 80600.00 may confirm the sell.