The Practical Investor

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.

11:10 am

SPX made an attempt to rise above the neckline at 6650.00, but the resistance was overwhelming, causing it to falter at the Fibonacci 38.2% retracement.  The decline may gather strength as it plummets toward (or below) its intended target this weekend.  Reality may finally be setting in.

ZeroHedge remarks, “Rearranging the Chairs

Tuesday was another down day for most markets as the US weekly ADP jobs report suggested the labor backdrop is weakening and housing starts sagged. As the FT puts it, ‘Oracle’s astonishing $300bn OpenAI deal is now valued at minus $60bn.’”

7:50 am

Good Morning!

SPX futures are back-testing the Head & Shoulders neckline near 6650.00 as I write this morning.  SPX broke through the neckline (thin ice) yesterday and the immediate reaction is to attempt to regain “higher ground.”  But the deed was done.  The Cycles Model calls for deteriorating conditions for the SPX up to monthly options expiration on Friday, resulting in a possible panic decline.  While smart money has been hedging, retail, commercials and hedge funds still find themselves uncomfortably long.  Even with the Head & Shoulders formation, most analysts still see the decline as a “minor” correction, due to the strength and persistence of the previous rally

Today’s options chain shows Max Pain at 6655.00.  Long gamma may prevail above 6680.00 while short gamma strengthens beneath 6635.00.  Beneath 6600 lies a “gamma trap” for speculators.

ZeroHedge reports, “After 4 days of steep declines, futures are finally higher ahead of Nvidia earnings, with AI bulls hoping for strong numbers to provide respite from the market selloff.”

VIX futures have “:stepped back” from yesterday’s high as it digests its gains.  VIX rose above 25.00 yesterday, attracting the attention of analysts and prognosticators, parsing out the meaning of this move.  The Cycles Model indicates a buildup of momentum going into and beyond equities options expiration.  Today’s VIX options expiration shows a “call wall” at 25.00, indicating increased volatility above that level.

TNX is consolidating after testing the 52-day Moving Average at 40.81 yesterday.  It may be ready to break out above the sideways formation as strength in the new trend builds this week.  The next resistance is the mid-Cycle level at 42.58, which could conceivably be reached by the weekend.

USD futures are testing the 200-0day Moving Average at 99.92 this morning, making life difficult for dollar shorts.  The Cycles Model indicates the massive short holdings may burst through resistance as shorts run for cover this weekend.

Bitcoin may have made an early Master Cycle low yesterday.   The normal routine would be to rise up to test the Head & Shoulders neckline at 98932.00, clearing out the weaker hands (shorts) before its final thrust to the implied target.  However, the declining fractal may not be complete.  There is a possibility of a new low near 86000.00 possible this week.

BKX is on a bounce that may take it back to the 52-day Moving Average at 149.91.  It appears that attempts are being made to keep BKX from selling off this week.  The Cycles Model infers that the powers-that-be may succeed temporarily, but the Cycle is getting very top heavy, while Wall Street denies any emergency.  While it is difficult to short the banks, indications are that a disaster may strike by mid-December.

ZeroHedge observes, “The alarms are getting even louder each week.  It has become exceedingly clear that the U.S. economy has entered a crisis that is similar to what we experienced in 2008 and 2009, and a lot of people are really starting to freak out.  For those that cannot see the stunning parallels between the Great Recession and what we are going through now, I don’t know what to say to them. ”

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.

11:19 am

SPX has crashed through the neckline of the Head & Shoulders formation at 6650.00 with attendant consequences.  Round number support at 6600.00 may temporarily send SPX back to the neckline to relieve the oversold condition.  The next level of support may be the September 2 low at 6350.00.  While there may be a bounce near there, the final target may be the April 7 low at 4835.00.

7:45 am

Good Morning!

SPX futures reached a morning low at 6616.30, well beneath the 52-day Moving Average at 6699.30 and on a confirmed sell signal.  It has also crossed the neckline of the Head & Shoulders formation at 6650.00, possibly triggering that formation.  The next possible bounce level is round number support at 6600.00, which may not last.  The reason?  Trending strength is growing and may turn the decline into a panic as monthly options expiration approaches on Friday.  Liquidity is still at a premium and the repo market may be stressed as a decline may put added demands on private lending institutions (banks).

Lance Roberts of RealInvestmentAdvice offers, “Last week, we discussed the importance of “math” as it relates to valuations and noted the importance of understanding “full market cycles.” To wit:

“The math on forward return expectations, given current valuation levels, does not hold up.  The assumption that valuations can fall without the price of the markets being negatively impacted is also grossly flawed. Historical data, as illustrated in the following chart, suggest that valuations do not decline without a significant impact on investment returns. Additionally, it is worth noting that “full market cycles,” which encompass both secular bull and bear periods, recur throughout history.””

Today’s options chain shows Max Pain at 6700.00.  Long gamma may begin at 6735.00 while sort gamma rules beneath 6670.00.

ZeroHedge reports, “US equity futures are sharply lower again – but off session lows – after the S&P 500 and Nasdaq closed below their 50-day moving averages for the first time since April; both tech and small caps are lagging as the market tries to find a level as the bond market continues to reduce the probability of a further Fed easing.”

VIX futures reached a new high at 23.91 this morning on a buy signal as trending strength builds toward options expiration.  There is little commentary on the VIX as it appears to be in a two month consolidation.  However, common recognition of a VIX bull market may arise above 25.00.

The November 19 monthly options expiration shows Max Pain at 21.00 in the VIX.  There are massive holdings of short gamma between 15.00 and 20.00 while long gamma may begin at 22.00.  Institutional positions are  noted at every 5 points starting at 25.00 with a presence to 100.00.

TNX is finishing its correction in a decline, possibly to Intermediate support at 40.70 this week as equities investors may be rotating out of stocks and into treasuries.  It may not prove to be a safe haven as the rally may resume with vigor early next week.

The USD Index is hovering near mid-Cycle support/resistance at 97.48 this morning.  It is also building trending strength this week with a possible target near the Cycle Top at 103.38 by the end of November.  The current Master Cycle may extend to the first week of December.

Bitcoin plunged briefly beneath 90000.00 this morning as the decline may be nearing a temporary respite.  It may be due for a bounce with a possible week-long snap-back to test the Cycle Bottom and the Head & Shoulders neckline at 98932.00.

Gold futures may be consolidating near the 4000.00 level.  Should it remain above its October 28 low at 3886.69, it may resume its rally until mid-December, as war tensions may rise.  A failure to rally may induce another stage of the decline to a minimum target at 3750.00.

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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.

7:30 am

Good Morning!

SPX futures rose to the trendline at 6780.00 over the weekend, then gave it all back this morning.  It is currently consolidating near Friday’s close.  The reason for Friday’s wild swing may have been negative gamma, which becomes a factor beneath 6730.00 today.  Keep in mind that the 52-day Moving Average lies at 6694.00, beneath which sentiment turns very bearish.  The Cycles Model suggests a rise in volatility toward monthly options expiration on Friday.  Puts and calls are running neck-and-neck in what may be an explosive trading day.

Today’s options chain shows Max Pain at 6760.00.  Long gamma dominates above 6800.00 while short gamma becomes strong beneath 6730.00.

ZeroHedge reports, “US equity futures are slightly higher led by Tech, but well off overnight highs, while stocks around global markets slide. As of 8:00am ET, S&P and Nasdaq futures are up 0.1%, having previously been as much as 0.6% higher, after both gauges closed above their 50-day moving averages on Friday, a key support level.”

VIX futures are consolidating above the mid-Cycle support at 19.70 this morning.  VIX is on a confirmed buy signal.  The Cycles Model shows increasing volatility up to equities options expiration on Friday and lingering into next week.

The November 19 options chain shows Max Pain at 21.00.  Short gamma is very heavy between 15.00 and 20.00.  Long gamma begins at 22.00 and reveals institutional presence up to 100.00.

TNX is behaving correctively and may may revisit critical support in a Trading Cycle low near 40.70 in the next day or two.  Subsequently, trending strength may build as the month of November winds up.  Bond volatility may erupt in early December as the current Master Cyclewinds up by mid-month.

USD futures have risen above the mid-Cycle support/resistance at 99.44 with the 200-day Moving Average just above it.  USD is coming out of a possible Trading Cycle low with increasing strength of conviction.  A breakout above the 200-day may follow with the Cycle Top acting as possible resistance by the month end.

Bitcoin may be bouncing from Sunday’s low at 93006.00.  Should that be the case, a probe to the neckline at 98932.00 may follow.  The Cycle Bottom lies just above the neckline as a secondary resistance, which may terminate the current Master Cycle in about a week’s time.  A further month of decline may follow.

BKX remains under the 52-day Moving Average and on a sell signal.  This proxy for liquidity has been supported, but may not last as liquidity needs will grow into the year-end.  Approximately 5 weeks of decline are built into the Cycles Model.

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.

10:15 am

SPX has gapped down at the open and bounced at a potential Head & Shoulders neckline,  testing the 52-day Moving Average at 6705.00.  Should resistance hold, SPX may then resume its decline beneath the neckline with knock-on consequences.  A secondary resistance may be the trendline at 6775.00.

10:30 am

NDX is also bouncing from a potential Head & Shoulders formation.  Stay alert for a decline beneath the trendline at 24535.00.  The down-sloped neckline may be more bearish.

7:45 am

Good Morning!

SPX futures have gapped down beneath the 52-day Moving Average at 6690.50, plummeting to 6664.00 thus far.  SPX is on a confirmed sell signal since crossing the 7-month trendline yesterday.  Thus far, the decline has been orderly.  However, a decline beneath the November 7 low at 6631.44 opens the volatility spigots.  Wall Street must defend that level.  Should the breakdown occur, the minimum target may be near 6350.00.  Retail investors are heavily long while street gamma is negative.  A dangerous combination.  The Cycles Model warns that trending strength may grow into Friday’s monthly options expiration.

Today’s options chain shows Max Pain at 6775.00.  Long gamma strengthens above 6800.00.  Short gamma dominates beneath 6750.00, with heavy reinforcements every 25 points lower.

ZeroHedge reports, “It’s ugly out there. Futs are sharply lower on doubts about whether the Fed will cut interest rates again in December, as fear deepens about stretched AI valuations and the debt used to fund them.”

VIX futures vaulted to 22.63, short of a breakout above the November 7 high.  Upside momentum appears to strengthen this week as panic may set in.  The Cycles Model implies a continued rise in volatility to late December.

The November 19 options chain shows Max Pain at 20.00.  Short gamma is heavily laden from 15.00 to 19.50.  Long gamma begins at 22..00 and strengthens at 25.00 with institutional presence every 25 points above.

TNX has declined beneath the 52-day Moving Average at 40.79, on its way to a Trading Cycle low early next week.  It remains relatively calm until monthly options expiration on Friday.  From that point on, volatility may erupt into the first half of December.

ZeroHedge reports, “After yesterday’s mediocre, tailing 10Y auction, and with yields pushing higher today, prospects for the week’s final coupon auction, today’s $25BN in 30Y bonds, were not too exciting. Which is a good thing because the just concluded final refunding auction was quite disappointing.”

USD is testing Intermediate support at 98.98 as it descends into a Trading Cycle low early next week.  The 52-day Moving Average at 98.52 is a likely target, but may go lower.  Subsequently, a new surge higher, with growing strength, may emerge and continue to the first week of December.

Bitcoin has broken down beneath the Head & Shoulders neckline at 98932.00 with considerable force.  The formation has been activated.  However, a bounce may arise, testing the neckline before trending lower.  Bitcoin may be another proxy for market liquidity as there is nothing backing it but the sentiment of investors with extra cash or people wishing to seamlessly cross national boundaries.  China may have outlawed the use of bitcoin and many European countries are considering banning it, which may be cutting off cross-boundary liquidity.

BKX has broken through the 52-day Moving Average at 150.07 this morning, placing it on a sell signal.  The banking index has been heavily defended until November 12, stretching out the Master Cycle in double overtime.  That support may give out at the end of November with a quadropoly indicated panic Cycle developing in December.

Gold futures declined to 4033.09, challenging the Cycle Top at 4133.00 and Intermediate support at 4045.88, making a Trading Cycle low that may be complete this weekend.  Keep in mind that the retracement may go to the 52-day Moving Average at 3914.67 before reversing higher.  These washouts may test the gumption of gold investors as they may be unable to withstand the shakeout.

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.

12:30 am

SPX has ;reached the trendline and Intermediate support at 6754.30 and may be ready to bounce.  A partial retracement may develop throughout the afternoon, although selling pressure remains.  The next bounce may be the 52-day Moving Average at 6699.00.  SPX may be on an aggressive sell signal which may be confirmed beneath 6700.00.  The tumble in equity markets is being led by the Nasdaq, specifically the Mega-Caps.

7:50 am

Good Morning!

Note:  We are facing a planned power outage this morning.  The morning report may be abbreviated.

SPX futures declined to 6828.60 after reaching its potential retracement limit.  The Retracement shows a 9-point fractal, which suggests completion.  Nearest support lies at 6744.51, where a sell signal may be acted upon.  The government shutdown took 43 days and is likely to be repeated in January with more damaging results.

ZeroHedge reports, “Futures are slightly lower as the market sells the news that the US government has finally reopened, and as traders now seek to identify a near-term catalyst before NVDA’s Nov 19 earnings release while the data vacuum is likely to persist for at least several days.”

VIX futures rose above the 52-day and trendline to 18.06 this morning.  The uptrend is not broken, allowing trending strength to grow over the next week.  A strong panic Cycle may develop around monthly options expiration next week.

ZeroHedge remarks, “We’ll begin with the famous quote from economist John Maynard Keynes: “The market can stay irrational longer than you can stay solvent.”

It’s a reminder that even the smartest traders in the room, the ones who’ve built entire careers calling bubbles and shorting tops, can be steamrolled when markets detach from reality.”

USD futures continue to decline as it retraces to support at the Intermediate level at 98.95.  The 52-day Moving Average is at 98.50 as an alternate target.  The retracement may be finished by the weekend.

TNX is consolidating beneath the 52-day Moving Average at 40.95.  It is making a Trading Cycle (minor) low before moving higher by next week.  Money may be moving out of stocks to treasuries as a traditional safe haven.  However it may not last, as the Cycles Model sugests higher 10-year rates to mid-December.

Bitcoin has resumed its decline toward the Head & Shoulders neckline.  Its anticipated low may occur in the last week of November.  Should it bounce at the neckline, we may see another bounce.  However, once beneath the neckline, any bounce may be a test of the neckline.

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.

7:40 am

Good Morning!

SPX futures rose to 6876.80 this morning, nearing a natural limit on retracements.  Comparison of past declines and recoveries may not be helpful for multiple reasons.  First is the rule of alternation.  All of the prior declines that were compared to resulted in a full recovery.  There is an alternative.  Second, the market may rhyme, but it does not repeat.  Third, five and a half years of dips, then recoveries have produced a Pavlovian reaction in investors.  The market doesn’t always recover, which may leave the majority on the wrong side.  This is a time to be skeptical, since retracements may rise up to (but not above) the prior high, trapping the buy-the-dip crowd should an unexpected reversal prior to a full recovery occur.  The Cycles Model leaves us with a potential double reversal that may go higher, but the fractal thus far leaves room for a reversal.

Today’s options chain shows Max Pain at 6830.00.  Long gamma may prevail above 6850.00 while short gamma rules beneath 6800.00.

ZeroHedge reports, “US futures are higher as the US takes another step to reopen with a House vote (expected to pass early evening on Wednesday, with Trump’s approval. As of 8:15am, S&P futures are 0.4% higher with the mood buoyed by expectations of an imminent end to the government shutdown and a Fed rate cut next month.”

VIX futures declined to a morning low at 17.10 before a bounce, testing the 52-day Moving Average.    VIX may have established its uptrend, albeit sluggishly.  Today’s action may be a Trading Cycle low, with trending strength on a rebound next week.  Today is weekly options expiration with Max Pain near 20.00.

The November 19 options chain shows Max Pain at 20.00.  Short gamma shows puts are heavily laden between 15.00 and 18.00.  Calls are coming alive at 22.00 and show heavy institutional involvement from 25.00 to 100.00.

TNX has dipped beneath its 52-day Moving Average at 40.85.  The Cycles Model shows a potential trading Cycle low this weekend, with recovery as the month progresses.  This may indicate a preference for Treasuries over equities, as the traditional search for a safe haven may develop.  The Cycles Model suggests a decline to the Cycle Bottom at 39.72 over the next week or so.

USD futures are consolidating at the mid-Cycle support at 99.61.  USD is in a correction that may revisit the 52-day Moving Average at 98.49 in the next week.  The Cycles Model indicates the rally may resume to the end of November.

Bitcoin may be consolidating after a steep decline.  The cycles Model indicates a potential resumption of the decline by early next week.  The current Master Cycle ends in two weeks.  The question is, will the decline venture beneath the Head & Shoulders neckline or stay above with another bounce?

Gold futures are consolidating above the Cycle Top support at 4109.13 this morning.  Trending strength may return next week with the rally resuming to mid-December.

The Ag index may be due for a short-term correction down to the 52-day Moving Average at 357.68.  Should it bounce at that level, the Cycles Model infers a resumption of the rally with strength next week.  The current Master Cycle may last to late December.

TheEpochTimes comments, “President Trump is boldly facing the problem of high meat prices but also dealing with the financial strains on farmers themselves. The issue is reconciling the two. Lower prices are great for consumers but also add to the financial problems of small farmers. Gradually, Trump has come to the conclusion that the real bottleneck is with meatpackers themselves, which is one of the oldest corporate monopolies in U.S. history.”

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.

7:50 am

Good Morning!

After having overshot its 61.8% Fibonacci retracement level at 6810.41 SPX futures may now be testing that level.  Yesterday’s rally appeared to be mostly short-covering, which may now be exhausted.  Intermediate support and the trendline lie at 6731.13 while the 52-day Moving Average lies at 6670.00.  The top view is that the decline may resume today, followed by the violation of the aforementioned supports.  Should that happen, the next phase of the decline may last a month or more.  Meanwhile, Wall Street labels the past two weeks as a “wobble” that can be ignored, calling for a Santa Rally to the end of the year.  Whether a wobble or something more bearish, watch the trendline for support or failure.

Today’s options chain shows Max Pain at 6810.00.  Long gamma may rise above 6830.00 while short gamma resides beneath 6780.00.

ZeroHedge reports, “US futures are weaker following the best day for the S&P500 in almost a month and the Nasdaq’s best day since late May. The market frontran the catalyst: late on Monday the Senate passed its funding bill, and the House is expected to vote on Weds, as it always eventually does, especially since it has Trump’s full support.”

VIX futures rose to 18.01 thus far this morning.  VIX is due for a bounce.  However, it may be hampered by overhead resistance at the mid-Cycle  at 19.64.  Clearing that resistance allows the VIX to resume its rally.

YNX has bounced above the 52-day Moving Average at 40.88 this morning.  While acting positively, it may still decline beneath the 52-day over the next two weeks.  Bond volatility is on its first uptick since May, making equities investors uneasy.  Easing beneath the 52-day may ease investors’ trepidations.  However, it may not last.

USD futures may be testing the Intermediate support at 98.90 this morning.  The Cycles Model indicates the rally may resume in the next week.  A breakout above the mid-cycle resistance at 100.17 may propel the USD to its Cycle Top at 104.24 by the end of the month.

Bitcoin may have started its next leg down.  A possible Head & Shoulders formation awaits beneath the low at 98930.00.  The Cycles Model suggests the current decline may continue to the end of November.  Should the neckline be broken, the decline may resume about three weeks later.

Gold futures rose to 4152.00 this morning, lifting it solidly above its Cycle Top at 4098.00.  The Cycles Model offers a rally to mid-December.  The intended target is a little more obscure, with 4500.00 being the base case.  A lot may depend on geopolitical events.

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.

2:12 pm

SPX may have completed its first fractal from the all-time high.  It is now due for a reversal to a much lower value, possibly its September 2 low at 6360.00 or lower.  The  Sell signal is confirmed beneath the trendline and mid-Cycle level at 6738.70.

8:00 am

Good Morning!

SPX futures rose to 6797.10 as a short squeeze creates a 57% retracement thus far.  The 61.8% Fibonacci retracement lies at 6810.61.  The Cycles Model calls for another hour or more at these or higher levels as the first bearish fractal completes in approximately 8 market days.  Investors were not buying the dip.  The bounce came from short covering and dealers liquidating to cover Friday’s options expiration.  Hedge funds and individual speculators remain “all in” the AI darlings.  The last pension contributions catch-up date happened on October 15.  Note: the peak occurred two weeks later.  Substantial lay-offs by corporate America have reduced the flow of contributions to 401(k) plans, reducing the flow of cash to passive index funds, further exacerbating the regular supply of new money to equities.

Today’s options chain show Max Pain at 6730.00.  Long gamma may begin at 6750.00 while short gamma rules beneath 6700.00.

VIX futures descended to 18.40 thus far.  A normal retracement may reach the trendline near 17.50 or the 52-day Moving Average at 17.01 before take-off.

The November 12 options chain shows Max Pain at 21.00.  Short gamma resides at 15.00 to 20.00.  Long gamma begins at 25.00.  The overall sentiment is still short.

TNX has probed above the 52-day Moving Average at 40.90 this morning and may go higher, short-term.  The reversal at the Intermediate support  may take another day or two to completion.  Subsequently, it may be due for a Trading Cycle low near mid-November.

USD futures may be consolidating at mid-Cycle support at 99.54.  It may resume its correction to the 52-day Moving Average at 98.42 by the week end.  Trendiong strength may not appear for the next two weeks, but may revive at month-end as the current Master Cycle wraps up.

Bitcoin is continuing its retracement from its Cycle Bottom at 98932.00.  A final probe higher may be made to the 50% retracement value at 107663.00 or as high as the mid-Cycle resistance at 111511.00.

BKX may have extended its Master Cycle high to today.  This has become a very stretched Cycle which may be due for a substantial decline.

Gold futures rallied to 4114.85 the morning as it may have overcome the Cycle Top resistance.  The breakout may allow gold to rally even further, as the new Master Cycle may extend to late December.  The prospect of further downside may be postponed to 2026.

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.

2:16 pm

SPX plunged beneath the 52-day Moving Average at 6670.00, then bounced above it.  It may rebound to an afternoon high at 6696.00 or the trendline at 6732.00.  This sets up for an even larger panic decline this weekend.

11:10 am

SPX has declined beneath the 52-day Moving Average at 6661.88. The sell signal is now doubly indicated and the decline continues.  Take appropriate action.

7:30 am

Good Morning!

SPX futures declined to 6691.00 this morning after having declined through the trendline at 6720.00, then closing at trendline resistance.  A sell signal has been triggered, offering an exit for longs and the opportunity for hedging/shorting.  The next lower support  is the 52-day Moving Average at 6658.36, which commonly elicits a bounce.  Should that occur today, a vigorous bounce  to 6800.00-6850.00 may ensue.  The alternate view allows the SPX to decline through the 52-day followed by fractal expansion (panic decline).  The Cycles Model reveals heightened volatility (a possible panic Cycle) starting today and continuing through the weekend into next week.  A large factor in the decline is the heightened layoffs.  The immediate result is the cessation of contributions to 401(k) plans which are passively invested into ETFs and mutual funds.

Today’s options chain shows Max Pain at 6760.00.  Long gamma may begin at 6775.00 while short gamma strengthened at 6750.00.  Options are tightly wound and may move explosively.

VIX futures rose to 20.87 this morning the SPX loses its grip on the 6-month trendline.  The Cycles Model reveals the VIX may be poised for a substantial move this weekend.  VIX continues on a buy signal that may last through late December.

The November 12 options chain shows Max Pain at 20.00.  Short gamma resides between 16.00 and 18.00, while long gamma strengthens above 23.00 and shows institutional involvement up to 55.00.

ZeroHedge remarks, “Markets have been whipping around more violently than usual over the last several weeks, a reminder that volatility is the natural habitat of a late-cycle market.”

USD is pulling back after being resisted at the 200-day Moving Average.  The Cycles Model reveals today is a day of trending strength which may propel the USD to a breakout above the 200-day.  This is the last bastion for the dollar shorts, who may be forced to liquidate  en masse, creating a strong surge.

TNX is lingering above the 52-day Moving Average at 40.32 this morning.  A breakdown may allow TNX to decline as far as the Cycle Bottom in the next week.  Keep in mind, however, that the trend in the TNX is now positive with a buy signal, suggesting that investors may buy the dip in TNX.

ZeroHedge remarks, “One month ago, when the market was freaking out by the lack of official government data (it has since realized again, that whether the government is open or closed, or what the jobs number is – certainly not until it is revised 3 or 4 times, does not matter), everyone scrambled to find private sources of economic data.”

Bitcoin is declining to test the Head & Shoulders neckline at 98932.00, where a bounce is possible.  A breakthrough triggers the formation with a subsequent panic decline.  The Cycles Model suggests a disturbance beginning during the weekend with a panic decline developing into next week.

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.

1:20 pm

SPX has crossed the 6-month trendline at 6725.00, creating a sell signal.  There may be a bounce soon that could take SPX back above the trendline, but the sell signal remains.  This may be a good opportunity to cut longs and add hedges.  Observation: A 50% retracement may allow the SPX to rise to 6813.50.  Likewise, a 61.8% Fibonacci retracement may retrace the SPX to 6839.00.

8:00 am

Good Morning!

SPX futures consolidated inside yesterday’s trading range as tensions build toward a possible crescendo this weekend.  Should SPX remain beneath 6835.00, the odds are likely of an imminent panic sell-off. Above that level, the situation remains more complex.  Smart money is already exiting equities, regardless of a potential new all-time high.

Today’s options chain shows Max Pain at 6805.00.  Long gamma may strengthen above 6835.00.  Short gamma dominates beneath 6800.00.

ZeroHedge reports, “US equity futures are higher, rebounding from session lows for the second day in a row, amid headlines that layoffs are surging due to AI which in turn is raising odds of a Dec rate cut, with JPM saying that “the market is weighing a weaker labor market and potential spending vs. evidence on the efficacy (and ROI) of AI plus productivity gains.” Challenger job cuts jumped to over 150K in October, nearly triple the year-earlier period and the most in more than two decades.”

VIX futures are also trading within yesterday’s trading range.  It may retest the 50-day Moving Average in the next day or so.  However, the Cycles Model calls for a trending surge into the weekend.  Should the surge continue, the VIX may continue to rise into mid-December.

TNX has pulled back from yesterday’s high and may correct over the next week or so.  Support may initially be found at the Intermediate level at 40.79, but it may go as low as the Cycle Bottom support at 39.77.

Bitcoin is consolidating this morning, but may be due for a panic washout this weekend.  The potential Head & Shoulders formation indicates a possible decline to the April 7 low or beneath it.  Bitcoin has been used as a tool for moving money across borders seamlessly.  That may be coming to an end as capital controls are being considered in the NATO countries to keep money inside their borders and allow access by authorities that are becoming more tyrannical.

ZeroHedge remarks, “These lessons go for pretty much any asset class, but where I’ve noticed the largest concentration of inane theories, economic non-sequiturs and general outright confusion is among the most hubris-laden speculators in the market, the Bitcoin crowd.”

BKX continues to consolidate sideways above the 52-day Moving Average at 149.93.  The 52-day may act as a support, but may release it, trap door style, this weekend.  Regulators always try to release bad news over the weekend, hoping to escape notice.  SOFR spreads have been blowing out, indicating distress in the banking market.  The Cycles Model suggests a panic may develop over the weekend, causing a liquidity crunch.