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 rose to 7236.40 as investors pile into the froth. But significant institutions have left the market as pensions rebalance, hedge funds sell and commercial traders are neutral. Retail investors have migrated to options, making it a very crowded trade. Mutual funds, on the other hand, are trying to catch up to large tech and energy performance, making these the “dynamic duo” theme going forward. Meanwhile, the Cycles Model calls for a correction, as these themes have been quickly overdone. The saying “sell in May and go away” may apply. The coming correction may offer investors a chance to reload for the final push later this summer.
ZeroHedge reports, “US equity futures are higher, set for a new all time high, as the rally that’s pushed Wall Street to record highs on strong megacap tech earnings continues, after the S&P posted its best monthly increase since November 2020.”
The Premarket VIX dropped to 16.51 this morning as the current Master Cycle extends to new lows. This tells us there may be new lows, as VIX is compressed beneath the old trendlines. The Cycles Model infers that the decline may last another week as the new Master Cycle winds down.
TNX has pulled back from the Cycle Top at 43.90 and may decline further as it consolidates its gains from the trendline low. The pullback may be stopped by Intermediate support at 43.19 before launching a new probe toward the neckline of the Head & Shoulders formation.
TheEpochTimes reports, “America’s mortgage debt continues to escalate, hitting the $13.2 trillion mark, according to an April 30 WalletHub report.
The personal finance website and app indicated that the average U.S. household owes nearly $109,000 in outstanding mortgage balances and that mortgage debt has remained on an upward trend over the past few years.”
USD may be on the verge of a reversal. It tested the April low at 97.63 and stopped above it. This action may signal a resumption of the USD rally. The mid-Cycle resistance at 98.56 offers a clear demarcation, above which a buy signal may be obtained.