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.

7:40 am

Good Morning!

SPX futures rose to 6449.80 this morning, failing to close the gap left at Friday’s close at 6460.00.  SPX may be due for a decline to test the 50-day Moving Average at 6311.81 today.  What follows may be observed closely to judge the reaction to that support by the bulls.  Should that support crumble, investors may be in for a wild September.  The Cycles Model calls for a month-long decline that may challenge the April 7 low.

Today’s options chain shows Max Pain at 6405.00.  Long gamma rules above 6450.00 while short gamma resides beneath 6375.00.

ZeroHedge reports, “US equity futures are higher following a two-day slide, led by Tech with a favorable court ruling boosting GOOG (+5.7% pre-mkt) and lifting the Mag7 group. As of 8:00am ET S&P futures are up 0.5%, recovering most of yesterday’s losses; while Nasdaq 100 futs add 0.7%. In premarket trading, Mag7 names are all higher with AAPL (+2.9%) and TSLA (+1.7%) the notable standouts alongside GOOG. Cyclicals are poised to outperform as the yield curve bear steepens. In Europe, the Estoxx 50 is up by almost 1%, led by info tech and industrials sectors. Longer duration bonds are seeing a global sell-off (30Y JGBs +7bp, 30Y Gilts +6bp) while US is outperforming (30Y +2bp); underperformance is driven by global budget concerns (these come and go), which have sent gold is higher for the 7th consecutive session, adding ~5% in that time.  USD is weaker and commodities are mixed. WTI crude futures fall 1.7% to near $64.50 after a report said that OPEC+ is considering another supply boost for October at this weekend’s meeting. Today’s data focus is on JOLTS, Durable/Cap Goods, Beige Book, and consumer-sector earnings to gain clarity on the consumer.”

VIX futures remained elevated above the 50-day moving Average at 16.36 this morning.  Today is options expiration and a hefty number of shorts may be wiped out, should it stay above the 50-day.

The September 10 options chain shows lingering short gamma at 15.00, but long gamma may be rising above 16.00.  Long interest may strengthen above 20.00.

TNX has pulled back from a test of the 50-day Moving Average at 43.18.  Should it break through, the next resistance may be the trendline and mid-Cycle resistance at 43.86.  The Cycles Model calls for rising rates through the end of September which may be troublesome for the mortgage market.

ZeroHedge observes, “Treasury Secretary Scott Bessent told the Washington Examiner on Labor Day that the Trump administration may declare a national housing emergency in the coming months to address the affordability crisis. Bessent’s comments come just ahead of an expected interest-rate cut cycle, underscoring the administration’s urgent effort to address the affordability crisis, which is set to be one of the key topics ahead of the 2026 midterms.”

USD futures remain above the 50-day Moving Average at 98.03 this morning, on a possible buy signal.

Bitcoin is consolidating near the 100-day Moving Average at 111751.00.  Monday’s reversal may have marked the revival of the uptrend in Bitcoin.  The Cycles Model suggests the uptrend may endure into early October.

Gold  futures may be trading near their all-time high this morning as the current Master Cycle may be wrapping up.  Futures have topped out at 3621.40 thus far, nearing the Cycle Top resistance.  The cash market may not be able to reach that resistance.

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.

9:58 am

SPX has challenged/bounced from the 2-hour mid-Cycle/Intermediate support and has tested the short-term support at 6404.00 thus far.  It may test the trendline near 6415.00 yet today.  It would not be wise to attempt to buy the dip with the SPX having declined beneath a critical trendline.  A more significant bounce may be found at the 50-day Moving Average at 6317.00.

7:50 am

Good Morning!

SPX futures sank to a holiday weekend low of 6410.70 (thus far), testing the Ending Diagonal trendline at 6404.00.  A decline beneath that level triggers an aggressive sell signal in the SPX.  The 50-day Moving Average lies 100 points lower at 6303.00, where a confirmed sell signal may be found.  Today’s activity may show some rising volatility.  An aggressive sell signal may show some blow-back, but also offers the best positioning for the downtrend to follow.  September has a history of being a tough month.   However, commercials and individual investors are 100% net long at the end of last week.  With mutual funds cash at an extreme low, there may be little liquidity to cushion a decline.  A negative payrolls number on Friday may greenlight a 50 basis point cut by the Fed.  The buyback blackout begins in the second half of September. The Cycles Model proposes a possible month-long decline with trending strength appearing in week 2 and climaxing in week 3.

Today’s options chain shows Max Pain at 6460.00.  Long gamma may arise above 9500.00 while short gamma resides beneath 6400.00.

ZeroHedge reports, “Following our warning that September tends to be the worst month for the S&P by a wide margin…

September is by far the worst month for stocks in the broken markets (post QE) era pic.twitter.com/iEZxKja6Ui

— zerohedge (@zerohedge) September 1, 2025

… US equity futures are acting accordingly and tumble on the first trading day of the month, dragged lower as part of a global risk-off tone sparked by a selloff in global government bonds which spooked investors and sent the dollar surging into a critical two weeks of macro data. As of 8:00am ET, S&P futures are down 0.8%, and Nasdaq futures slide 1%,  deepening the tech-driven selloff that closed out last week. Nvidia led premarket losses among the Mag7 retreating 2.2% with all Mag7 names lower in premarket trading. Energy names are outperforming as crude rallies ahead of an OPEC+ meeting this week. Commodities are weaker ex-Energy complex as WTI heads for its best day since late July; gold hit a record high above $4,500 before retracing some of the move; silver also broke out to a new 11 year high, however subsequent USD strength is pressuring precious metals. The dollar posted its biggest gain since July, putting it on course for a first advance in six days. Today’s macro data focus is on ISM-Mfg and Construction Spending.”

VIX futures shot up to 18.57 thus far this morning, breaking through the 50-day Moving Average at 16.46 and triggering a buy signal.  Most analysts may only recognize a breakout above the trendline near 20.00 a a signal for action.

Tomorrow’s options chain shows short gamma clustered at 14.00-15.00.   Long gamma resides above 20.00, but trails off at 30.00.  There is an institutional presence at 50.00

Bitcoin may have made its Master Cycle low yesterday at 107271.00.  A potential buy signal may await above the 100-day Moving Average at 111715.00.  The Cycles Model suggests a rally through early October.  Should it rise above the 50-day Moving Average at 116060.00, it may test the Cycle Top resistance at 127506.00 by October.  Bitcoin futures, which expire on August 25, are trading at a premium.

TNX has leaped to a morning high at 43.00, nearly reaching Intermediate resistance at 43.10, above which lies a possible (yields) buy signal.  The 50-day Moving Average lies at 43.22, where universal recognition may be made.  Bond vigilantes have appeared with a vengeance, especially in Japan and Europe.  Will the US bonds follow?

ZeroHedge reveals, “UK capital markets are creaking once again as investors’ confidence in the Starmer government is crushed amid concerns over the fiscal outlook.

The yield on long-dated UK bonds rose to the highest since 1998…”

USD futures rose to 98.59 this morning as bond yields worldwide have spiked.  It surpassed the 50-day Moving Average at 98.04, creating a universally recognized buy signal.  While the reversal may have come early, it may be reinforced with a blast of trending strength by the weekend.

Gold futures may have made a new all-time high yesterday, but gold traded on the Chicago Mercantile Exchange may not release its record until the end of today.  The observation being made is that it may also have reached its Master Cycle high in the process.  Triangles often finalize their formation with a false breakout misleading investors on a wild goose chase to nowhere. Should that be so, the Cycles Model suggests an imminent decline lasting until mid-October.

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 eased down to 6477.10 in the overnight session thus far.  Support lies at 6400.00, beneath which a sell signal may arise.  The terminus of the current Master Cycle is now a week overdue and the SPX has made an all-time high at 6508.23 yesterday, meeting its primary objective.  Today is not a day to go long as stocks remain overbought and  fragility increases.

Today’s end-of-the-month options chain shows Max Pain at a highly contested 6475.00.  Long gamma may gains ascendancy at 6500.00 while short gamma rules beneath 6450.00.

VIX futures hovered above yesterday’s proposed Master Cycle low at 14.12.  The turn window may be closing fast, as the Master Cycle is a week overdue.  As VIX tumbles to its 2025 low, speculators are at record short positions.  This may not end well for the shorts as September is the worst month of the year, seasonality-wise.

The September 3 options chain shows massive shorts between 14.00 and 15.00.  Longs take possession at 17.00, but do not have the same conviction as the shorts.

TNX futures rose to 42.30 this morning after bouncing from the lower trendline of the Triangle formation at 42.03.  Once the bounce is complete, it may continue its decline to the Cycle Bottom at 40.98, or possibly lower.

ZeroHedge remarks, “A stellar 2Y, a solid 5Y and a dismal 7Y auction: that about sums up this week’s coupon issuance.

Moments ago, the US treasury completed the week’s final auction when it sold $44 billion in 7Y paper in what was an ugly auction.

Starting at the top, the high yield was 3.925%, the first sub-4% coupon auction since last September. It also tailed the When Issued 3.922% by 0.3bps, the first tail since April and quite a reversal to last month’s record-matching stop through.”

Bitcoin may be completing its final probe to its Cycle low in the next few days.  Should that be so, a new all-time high awaits investors as it rallies through the month of September.

GOLD futures have eased down in a consolidation move prior to a final thrust higher, ending the current Master Cycle.  It is likely to stage a false breakout, attracting more speculators.  However, gold next move may be a 400-point decline, flushing’s out the speculators.

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.

8:30 am

Good Morning!

SPX futures reached an overnight high at 6492.80 as it probes toward 6500.00 this morning.  Barring any unforeseen circumstances, the probe to a new all-time high may be complete this morning.  Nvidia’s earnings announcement failed to impress, leaving investors searching for the next big thing.  Unfortunately, not all news will be positive going forward.  The Cycles Model is primed for a turn but may remain in neutral over the Labor Day weekend.  Awareness of a reversal may not surface until next week.

Today’s options chain reveals Max Pain at 6460.00.  Long gamma resides above 6480.00 while short gamma emerges beneath 6450.00.  The shorts are gaining courage.

VIX futures revisited the August 22 low, testing trendline support.  The Cycles Model may not support a deeper low.  An attempt to punch a hole in the “floor” may backfire as support may not only hold, but act as a propellant to the imminent reversal.  VIX has completed a near perfect 8.6-month Intermediate Cycle.  The new Cycle about to begin may have a peak-to-peak amplitude that may be a multiple of Intermediate Wave (1).

The September 3 options chain shows Short gamma in the range3 of 14.00-15.00.  Long gamma may begin at 17.00, but there is not a lot of conviction above 21.00.

TNX is heading lower this morning and may break through the Triangle formation.  If so, it may reach the Cycle Bottom at 40.98 in a matter of days.  This arrangement could be devastating, as rates may increase while equities fall, leaving one less “safe haven” for investors.

Yesterday ZeroHedge reported, “After yesterday’s stellar, blowout 2Y auction, moments ago the US sold $70 billion in 5Y paper in what was a far weaker auction.

The high yield was 3.724%, down from 3.983% in July and the lowest since last September’s 3.519%; it also tailed the When Issued 3.717% by 0.7bps, the 3rd tail in a row.’

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.

9:44 am

The Banking Index may be making its final probe toward the Cycle Top at 151.56 this morning, making a new all-time high for the BKX.  The prior high was 148.96 made on January 10, 2022.  This may be the completion of the Cycle Trend (at 4 degrees).  The ensuing decline may take the BKX to its April 7 low

7:45 am

Good Morning!

SPX futures reached an overnight high at 6474.10 as it approaches its target range of 6500.00 to 6565.00.  NVDA earnings are on deck today and could spark a volatile reaction.  Nvidia accounts for 8% of the SPX, so it has the ability to influence the markets.  At the same time, the current Master Cycle has run its course and is in overtime.  This may be the last week to finish the course before negative seasonality appears.  The Cycles Model infers that September may be a seriously negative month, especially after the inversion in August.

Today’s options chain shows Max Pain at a hotly contested 6450.00.  Long gamma appears above 64750.00 while short gamma dominates beneath 6430.00.

ZeroHedge reports, “Futures are flat with all eyes on NVDA – the largest S&P component by far accounting for a record 8% of the S&P – set to report after the bell. As of 8:00am, S&P futures are just barely in the green recovering from a modest loss earlier, while Nasdaq futures gain 0.1%, with NVDA up +54bps premarket, tracking most of the Mag7 higher and Semis also bid. Cyclicals are mixed (Industrials up, Fins down) with Defensives mostly higher. The yield curve is twisting steeper but with a lesser magnitude to yesterday: bonds steadied after long-dated debt from the US to France and the UK retreated Tuesday, with the yield on 10-year Treasuries little changed at 4.27%. $70 billion of 5Y notes will be auctioned at 1pm ET; yesterday’s 2Y auction saw strong demand closing 1.5bp through. The USD jumps to the highest since Friday’s Jackson Hole dovish pivot, with the Euro sliding to a 3 week low as attention turns to the political mess in Europe, and gold continues to trade rangebound. The market’s focus is on NVDA today (our preview is here).”

VIX futures are trading in a narrow range near yesterday’s close.  The current fractal allows a final probe t lower.  The Cycles Model suggests today may be the low, as the Cycles Model suggests a burst of strength to complete the declining fractal.  VIX seasonality turns positive in September.

Today’s monthly options expiration is loaded with short gamma which may influence the outcome at the close.  The September 3 options chain shows short gamma beneath 15.00 and long gamma gaining dominance above 20.00.

Morningstar observes, “September typically is a loser. August’s return depends on the index you track.

Bulls and the bears each claim August as one of their own. They’re both wrong.

When taking all available historical data into account, August is an average month. There is no statistically significant difference between the month’s average return and that of all other months. Your best guess for how the stock market will perform during August is that it will be no better or worse than the long-term average for all months – which is a dividend-adjusted gain of 0.70%.”

TNX continues to consolidate within a possible Triangle formation.  There is a possibility of a breakout above the formation tis week.  However, if this analysis is correct, it may be a false move.  The Cycles Model suggests that TNX may decline during the month of September, as investors seek a safe haven from a stock market decline.

USD futures rose above the 50-day Moving Average at 98.11 this morning, confirming a buy signal.  The Cycles Model suggests growing strength in the uptrend as we approach this weekend.  The next few weeks may be notably strong.

Bitcoin may be continuing its decline to Labor Day.  A likely target for the decline may be the mid-Cycle support at 101364.90.  It appears that Bitcoin may be viewed as a safe haven during the stock market decline.

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

SPX futures declined to 6415.50 overnight before a small bounce.  While today is day 263 (of an average 258 days), the fractal structure may not yet be complete.  The final probe to a new ATH may take the SPX between 6500.00 and 6558.00.  A move of that dimension may trigger the final sidelined investors to “buy the dip” to their ultimate dismay.  This move may drain any liquidity left on the sidelines, causing a “no bid” situation in the ensuing decline.  The Cycles Model calls for a decline lasting to the end of September, cementing its reputation is the most bearish month.

Today’s options chain shows Max Pain at 6450.00.  Long gamma may strengthen above 6500.00 while short gamma begins in earnest beneath 6445.00.

ZeroHedge reports, “US equity futures are a tad lower as the yield curve twists steeper with 5Y yields flat, after Trump moves to fire the Fed’s Cook, sending the USD is weaker. A showdown looms with Cook saying that Trump has no authority to oust her and that she will not quit (previously the SCOTUS indicated that the Fed Governors could not be fired at-will but if it does decide that Trump fired her for cause, Powell would be responsible if he keeps her on after Trump has sacked her). As of 8:15am, S&P and Nasdaq futures are down 0.2% even with Nvidia rising 0.5% ahead of its results on Wednesday. In premarket trading, semis are higher with Defensive sectors outperforming Cyclicals; large-cap Industrials are in the green. In Europe, major markets are all lower with France the biggest laggard on fears of gov’t stability; Germany and UK the relative areas of safety. Commodities are weaker, dragged by Energy. Key events today include the August Philadelphia Fed non-manufacturing index and July preliminary durable goods orders (8:30 a.m.), June FHFA house price index and S&P CoreLogic home price indexes (9 a.m.), August Richmond Fed manufacturing and business conditions indexes and Conference Board consumer confidence (10 a.m.). All eyes on Nvidia earnings tomorrow.”

VIX futures rose to 15.75 this morning as it pulls away from a possible Master Cycle low made last Friday.  An alternate view may infer a final probe lower.  The Cycles Model suggests a spike in volatility on Wednesday that may complete the fractal.

TNX futures continue to consolidate in line.  A study of the Cycles Model reveals a possible scenario that has legs.  That is, TNX may hold steady or possibly decline for yet another month as stocks decline.  The 10-year Treasury Note appears bullish during that same period.  It is possible that TNX may reach its April 7 low.

Bitcoin has fallen beneath its 100-day Moving Average with a week to go in the current Master Cycle.  The highest probability target for this decline may be the mid-Cycle support at 101275.80.  However, there may be a spike in volatility by the weekend that could affect the ultimate goal.

USD futures remain above the 50-day Moving Average at 98.10 today.  It may be on a  sell signal, but awaits confirmation with a close above the Intermediate support/resistance at 98.30.  The Cycles Model calls for a rally to mid-September with a possible extension.

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.

8:30 am

SPX futures have pulled back to 6446.00 this morning as it consolidates prior to another probe toward 6500.00 to 6552.00.  The current Master Cycle is extending on day 262 and may consume some or all of this week to complete its fractal.  The SPX may explore new highs with volume and volatility to bring in the last holdout to the party as it sucks the liquidity dry, leaving no one to buy the dip.  The Labor Day weekend is typically a seasonal high point before September comes crashing down.  The ensuing decline may take the entire month to complete with the April 7 low as the possible target.

Today’s options chain shows Max Pain at 6455.00.  Long gamma may begin above 6470.00, while short gamma appears beneath 6420.00.

ZeroHedge reports, “Markets are mixed this morning, with US stock futures ticking lower as euphoria over the prospect of a Fed rate cut fizzling out after Friday’s rally. Attention turns to one of the biggest market tests ahead of the central bank’s September policy meeting: Wednesday’s Nvidia earnings. As of 8:15am, S&P futures are down 0.3% after the best day since May and the index finishing the week 2pts below its all time high. Media are pointing to a lack of Fed consensus to cut based on comments from Goolsbee / Musalem. Pre-market Mag7 names are all lower with Defensives outperforming Cyclicals, reversing some of the gains from Friday. Intel shares rose in premarket trading after the US agreed to take a 10% stake in the chip maker. The yield curve is bear steepening and the USD is strengthening. Commodities are rallying led by Energy. The keys this week are NVDA earnings but also a number of macro data releases that can clarify the US econ growth situation, e.g., Durable / Cap Goods, Consumer Confidence, regional Fed activity indicators, jobless data, PCE, and Personal Income / Spending.Looking at today’s calendar, we get new home sales and Dallas Fed manufacturing index. Fed Voter Williams and non-voter Logan are also scheduled to speak.”

VIX futures are consolidating near Friday’s low.  The proposed Master Cycle may also be extended this week.  Any semblance of calm may be destroyed once the reversal is in.  The Cycles Model suggests Wednesday as a high volatility day and a possible reversal.

The August 27 options chain shows Max Pain at 16.00.  Short gamma is taking on a diminished role under 15.00 while long gamma rules above 18.00.

TNX is approaching the final days in which it may make a low near the Cycle Bottom at 40.98.  It remains in a shallow decline that may be conducive to a further decline to Bottom Support.  Unfortunately, more and more home buyers are financing their purchases with adjustable rate mortgages, expecting long-term rates to decline.  The Cycles Model says that the opposite may be true.  This may be a disaster waiting to happen.

USD futures bounced from an extended Master Cycle low on Friday.  The low may be confirmed with the crossing of the 50-day Moving Average at 98.09, offering a potential buy signal.  Dollar bears rejoiced at the Powell speech, anticipating lower yields and a lower USD.  However, the USD has already broken out of its downtrend and may cause a fresh batch of short covering.

Bitcoin futures reversed down from the 50-day Moving Average at 116543.00 on Friday and is now testing the 100-day Moving Average at 115575.00.  It is on a confirmed sell signal.   The Cycles Model suggests another week of decline before a bounce to retest overhead resistance.

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.

1:08 pm

SPX has paused as it reaches for a new all-time high.  A potential target may be in the range of 6485.00 – 6500.00.  Most strategists were caught by surprise at Powell’s speech.   Retail investors are throwing caution to the wind as they speculate whether Powell will make a .25% or .50% rate cut in September.

9:00 am

Good Morning!

SPX futures bounced from Intermediate support at 6340.90 this morning.  Investors are waiting for the outcome of Jerome Powell’s speech at 10:00 am.  Whether Powel focuses on inflation or employment may give investors the direction of the path forward.  The Cycles Model tells us that the current Cycle has either ended on August 15 or may go to a new all-time high in a final flourish of volatility.  The aftermath may be a decline to the end of September.

What we have witnessed is a month-long Cycle inversion that may be more of a result of runaway investor expectations than outright attempts at manipulation.  Valuations have now exceeded those of the 2000 high.  Critical support lies at 6346.06.

Today’s options chain shows Max Pain at 6400.00.  Long gamma may begin at 6425.00 while short gamma becomes strong beneath 6375.00.

ZeroHedge reports, “After five days of selling – the longest stretch since Jan 2 – US stock futures halted this week’s run of losses in muted trading ahead of Jerome Powell’s Jackson Hole speech, even as markets scaled back bets on imminent interest rate cuts following very strong economic data on Thursday. As of 8:00am ET, S&P 500 rose 0.2% erasing an earlier decline, while Nasdaq futures rose 0.1% as Nvidia shares fall 1% in premarket after the Information reported the chipmaker had instructed component suppliers to stop production related to the H20 AI chip.  European stocks advanced 0.2%, nudging toward an all-time high. US Treasuries held steady after Thursday’s pullback, with the 10-year rate at 4.33%. The dollar was little changed. there are no scheduled events on the US economic data calendar; Fed Chair Powell is set to speak at 10am ET at Jackson Hole with a slew of other central bank comments expected from the event. The Fed speaker slate also includes Boston Fed President Collins at 9am and Cleveland Fed President Hammack at 11:30am; hawkish comments by Hammack on Thursday pushed yields to session highs. Swap contracts linked to future Fed rate decisions fully price in one quarter-point rate cut this year in October and a second one by year-end.”

VIX futures are consolidating inside yesterday’s range.  It is due for a pullback today. The Cycles Model supports a possible new low in a complex Ending Diagonal Fractal.  The chart suggests a target near 14.00.

TNX is poised for the delivery of Powell’s speech.  Both time and price dictate the final low may arrive today , or early 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.

8:00 am

Good Morning!

SPX futures consolidated beneath the trendline after bouncing off Intermediate support.  The bounce may develop further, with a potential target at the 61.8% retracement at 6428.00, or to the trendline, now approaching 6450.00.  A new, all-time high is possible, due to the structure of the fractal.  However, it may not last.  The Cycles Model allows one last blast of trending strength today before the downtrend may take hold.  The buyback blackout begins after Labor Day.  Critical support lies at 6338.00.

Today’s options chain shows Max Pain at 6400.00.  Long gamma may begin above 6430.00 while short gamma resides beneath 6350.00.

ZeroHedge reports, “US equity futures dropped, extending the recent selloff into its fifth day, as traders stayed guarded ahead of the Federal Reserve’s gathering at Jackson Hole. As of 8:00am, S&P 500 futures fell 0.2%, while Nasdaq 100 futures were flat after a two-day selloff that erased 2% off the index. In premarket trading, Nvidia rose 0.8% while most Magnificent Seven peers posted losses. Retail giant Walmart brought Q2 earnings season to an unofficial close after reporting an EPS miss (68c vs exp. 74c) and even though it lifted guidance (now expects net sales to rise 3.75% to 4.75% this year, versus previous forecast of a 3% to 4%) that wasn’t enough for the market, however, and the stock dropped in premarket trading. European stocks dropped 0.3%, erasing an earlier gain, and snapping a three-day winning streak. US treasuries fell, pushing the yield on the 10-year higher to 4.31%. The dollar strengthened and reversed all of yesterday’s losses while Brent crude rose to the highest in two weeks even as the rest of the commodity complex was mixed. It’s a busy economic calendar: we get weekly jobless claims and August Philadelphia Fed business outlook (8:30am), S&P Global US PMIs (9:45am) and July leading index and existing home sales (10am). The Fed speaker slate includes Atlanta Fed President Bostic at 7:30am, the last central bank official slated to speak before Chair Powell’s discourse at Jackson Hole Friday.”

VIX futures ae consolidating inside yesterday’s trading range.  VIX has issued a buy signal and the pullback offers the opportunity purchase cheap hedges.  The Cycles Model suggests that trending strength may appear next week.

The August 27 options chain shows short gamma at 15.00-16.00.  Long gamma begins at 17.00.  While sentiment is swinging long, there is not a lot of conviction, yet.

TNX is easing down, in anticipation of a Powell rate cut in September.  The 10:00 am speech tomorrow may be used to announce upcoming policy changes.  Money markets are pricing in an 80% chance of a .25% rate cut in September.  Should the speech be nuanced in favor of a rate cut, we may see TNX  pay a visit to the Cycle Bottom at 40.99.

ZeroHedge  reports, “With bond yields sliding thanks to the ongoing stock drawdown, there wasn’t many concerns about demand for today’s 20Y auction. And rightly so, because the sale of $16 billion in 20 year bonds went through without any difficulty amid solid, if hardly stellar, demand.

The auction prices at a high yield of 4.876%, down from 4.935% in July and stopped through the When Issued 4.877% by 0.1bps, the second consecutive stop through after 2 tails.”

USD futures are rising above the 50-day Moving Average at 98.10, giving a buy signal.  Dollar shorts are in for more pain as the rally gains momentum.

Bitcoin has slipped beneath the 50-day Moving Average at 115,763.45, reinforcing the sell signal.  The 100-day is not far away, at 111,147.00.  Keep in mind that Bitcoin is a pure speculative play, with no intrinsic value beneath it.

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.

12.45 pm

The Banking Index has lost support at the Intermediate level, giving a sell signal.  It has pulled back to test Intermediate resistance at 143.26.  Further erossion beneath the 50-day Moving Average at 139.95 adds confirmation to the sell signal.

12:40 pm

VIX has challenged the 50-day Moving Average at 16.88, offering a buy signal.  It’s time to buy the pullbacks.

12:33 pm

SPX has bounced from the Intermediate support at 6341.93 this morning.   Crossing beneath the trendline has created a sell signal, allowing investors to short the bounces.  The trendline may now act as resistance.  The next probable bounce may be the 50-day Moving Average at 6250.90.  Some trading desks are telling their customers to buy the dip.  The youngsters working there haven’t seen a real sell-off.

8:00 am

Good Morning!

SPX futures declined to 6390.30 this morning, as it flexes beneath the Ending Diagonal trendline near 6420.00.  The trendline may be broken.  Further confirmation lies beneath Intermediate support at 6333.27 while the 50-day Moving Average gives final support at 6235.60.  The Cycles Model suggests the uptrend may be finished by the end of the week, evidenced by the loss of key supports.

Today’s options chain shows Max Pain at 6425.00.  Long gamma may begin at 6440.00 while short gamma lies beneath 6400.00.  Short gamma may intensify beneath 6375.00.

ZeroHedge reports, “US equity futures are down and headed for a 4th day of losses, but trade well off session lows as markets assess if the sharp momentum selloff we have discussed for the past week will extend into today’s session: the JPM Momentum Basket (JPMPURE Index) is down more than 7% since the CPI print while Goldman said it’s time to resume buying momentum factor. As of 8:00am S&P futures are down 0.2%, after dipping 0.5% earlier in the session; Nasdaq futures are also down 0.2% after the index logged its second-biggest decline since April on Tuesday, with Mag7 names lower premarket ex-NVDA/MSFT; Defensives are outperforming Cyclicals. According to JPM “today feels like a test for the dip-buyers, as Flash PMIs tomorrow and Powell at Jackson Hole on Friday may prove to be market movers/narrative changers.” The yield curve is twisting flatter with the USD not flat. Commodities are seeing a bid across all 3 complexes highlighted by WTI. The macro data today is mortgage applications and Fed Minutes with tomorrow delivering Flash PMIs, jobless data, leading index, and existing home sales.”

VIX futures rose to 16.13 thus far, testing Intermediate resistance at 16.23 after having made its Master Cycle low on August 13.  The 50-day Moving Average provides further resistance at 16.99.  While technicians may recognize either of these levels as critical, most investors are likely to wait for the  breakout above 21.90 to begin hedging.  Last week’s monthly options expiration in equities showed dealers owning a record $10 billion in long gamma.  Today’s monthly options expiration in the VIX is likely to release a massive short gamma dealer position, allowing the VIX to rise from the “floor” where it has been suppressed for the last several months.   The Cycles Model suggests a rally in the VIX to early October.

The August 27 options chain shows virtually no short gamma.  Long gamma may arise at 15.00 and extends to 25.00.  Conviction in long gamma appears modest.

TNX is pulling back this morning from a test of the 50-day Moving Average at 43.43.  The Cycles Model allows for an extension of the Master Cycle in time and space.  This week may prove the limit in time, while the Cycle Bottom support at 41.00 may give the final target.  Jackson Hole may provide some solace for those seeking further rate cuts, but it may not last.

USD futures are hovering near the 50-day Moving Average at 98.12 this morning after a potential breakout.  The Cycles Model suggests the USD may resume its uptrend through mid-September.  While the Cycles Model offers no immediate insight, there are always outside catalysts that may bring about a reaction.