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
Good Morning!
SPX futures declined to 7655.50 overnight, then rose above 7700.00 this morning. It crossed above Intermediate suupport/resistance at 7688.00 and has reiterated its buy signal. The Cycles Model has the SPX rising to the week of October 12, but with little conviction thus far. The Cycle Top resistance rests at 7995.00 and the upper Diagonal trendline lies above 8050.00. In August I had calculated the upper boundary of the top in the SPX near 8100.00. That may remain a legitimate view.
ZeroHedge reports, “US equity futures have reversed earlier losses and trade in the green, near session highs, as bond yields drop across the curve, following a decline in oil which has also hit the dollar, despite lack of any tangible news out of Iran and as traders brace for the week’s first labor data following a neverending firehose of artificial-intelligence news and events.”
The premarket VIX slipped lower this morning, but remained above the lower Triangle trendline near 15.50. The fractal construct allows the VIX to dexcend to the lower trading channel trendline beneath 13.00. The Cycles Model still makes an allowance for a distinctive tail beneath the Triangle formation.
The US 10-year Bond Yield has pulled back from yesterday’s high and may be due fpr a decline to the neckline of the Head & Shoulders formation. Bond shorts are very crowded. The decline in yields may take some negative pressure from equities. The Cycles Model allows the pullback to reach the neckline of the Head & Shoulders formation during the week of October 5.
ZeroHedge comments, “If you wanted a textbook example of a central bank trapped between a geopolitical rock and a stagflationary hard place, welcome to September 2026. To wit: the ongoing standoff in the Strait of Hormuz is tearing through the global energy market, and the resulting inflation shock is vaporizing the bond market.”
The US Dollar continues its climb towad the head & Shoulders neckline at 101.80. However, momentume is being lost. Should a reversal take place, the decline may reach the 52-day Moving Average in the next two weeks.
Crude Oil is testing the Intermediate support at 90.87 this morning. Should it gain a foothold today, it may resume its uptrend toward the neckline of the Heaad & Shoulders formation. The Cycles Model indicates a possible dramatic increase in trending strength in October, indicating that the Head & Shoulders may be activated during that time.
ZeroHedge observes, “Iran is said to have struck a Very Large Crude Carrier in the Strait of Hormuz late on Monday, signaling what will likely be the resumption of strikes on foreign vessels seeking to navigate the Strait of Hormuz, after last week’s diplomatic talks at the UN failed to produce a breakthrough.”
Gold may be bouncing at round number support, relieving the oversold condition. It may bounce higher, testing the 52-day Moving Average at 4302.95. The Cycles Model indicates a probable further decline which may last to mid-October. However, the Cycles Model offers that, if its exceeds the 52*day Moving Average, there may be a long-shot possibility that gold may go considerably higher.
The Ag Index remains hovering above its double reversal low at 416.53. The significance of that low is that it nearly matches the February 19, 2025 high. In other words, it may be “proving” its breakout above that significant high. Should that level hold, the Ag Index may have entered the next phase of its rally. The Cycles Model indicates that the month of October may prove very strong, especially above the neckline of the proposed head & Shoulders formation.
ZeroHesdge observes, “A heightened wave of federal immigration enforcement in southwest Kansas has sent a shockwave through the U.S. beef supply chain, causing severe processing plant slowdowns, stranding thousands of cattle at feedlots, and threatening to drive up consumer meat prices.”
Bitcoin continues its sideways consolidation. The trendline through the middle of the chart is beginning to act like a neckline for a possible Head & Shoulders formation. Should that be the case, the formation may have already been activates with a possible completion by the end of October. It may act as an escape mechanism for failing economies such as Japan and the European Union.