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.

7:30 am

Good morning!

SPX futures rose to 6285.10, then dropped to 6243.90 over  the holiday weekend session.  The anticipated volatility has kicked in, leading to a possible reversal over the weekend.  This may be confirmed on Wednesday, expected to be a highly volatile day.  Should that be so, the Cycles Model projects a decline lasting to late August.  Stock market liquidity is becoming less friendly while recession risks are growing.

ZeroHedge reports, “US equity futures are weaker with investors on edge about the potential for more tariffs from the Trump administration as we head into the July 9 deadline which appears to have been rolled to Aug 1. As of 8:15am ET, S&P 500 contracts declined 0.2% although well off session lows after Treasury Secretary Bessent indicated that some countries may get a three-week extension to trade negotiations. Nasdaq 100 futures dipped 0.4% with small caps underperforming but tech is being dragged by TSLA sliding 6% after Elon Musk announced he will form a new political party. Apple (-1.0%) after phone shipments from China in May were down 9.7% Y/Y for the tranche that includes iPhones. Semis/Cyclicals under pressure. Trump said either a deal will be done, or a country will get a letter on Monday with 12 letters set to be sent today. Additionally, the president said late on Sunday that Anyone aligning with BRICS “Anti-American” stance is subject to an additional 10% tariff. Oil was flat, rebounding from session lows after OPEC+ did another supply hike, this time for 548k bpd. Yield curve is twisting steeper, USD stronger, and cmdtys declining (Ags, metals). This is a light macro data week into next week’s CPI and kick off to earnings season.”

VIX futures rose off their Thursday low, making a minor breakout above Thursday’s high at 17.48.  Confirmation and a buy signal may come above resistance at 19.95.

1:00 pm  

TNX continues to rally from its July 1 low, leaving a Master Cycle bottom.  It is on a buy signal and may be confirming it today asi it rises above the 50-day Moving Average.

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.

9:15 am

Good Morning!

SPX futures rose as high as 6220.00, but settled down to a projected flat open.  However, the Cycles Model suggests the decline may begin with strength today.  Should that be the case, the 2.5-month trendline lies near 6100.00, giving a clear sell signal beneath it.  The reversal has happened roughly two weeks later than the average length of a Master Cycle.  That, plus the completion of the fractal beneath 6239.00 gives fair warning that the decline may have begun.

Today’s options chain shows Max Pain at 6190.00.  Long gamma may begin above 6200.00 while short gamma gains traction beneath 6175.00.

ZeroHedge reports, “US equity futures are flat, after trading in a narrow overnight range, with small caps outperforming as we see more signs of a Value rotation as H2 kicks off and after yesterday’s dramatic momentum plunge. As of 8:00am ET, S&P futures are fractionally in the red, reversing an earlier 0.3% gain as President Donald Trump’s July 9 tariff deadline gets ever closer — Trump said on Tuesday he won’t delay the date for imposing higher levies on trading partners; Nasdaq futures drop 0.1% with Mag7 names mixed in premarket trading. Futures for the small-cap Russell 2000 rose 0.9% to outperform as Tuesday’s rotation out of high-momentum stocks extended, which helped Cyclicals led by Financials continue to outperform.  European equities advanced 0.4%. Bond yields are higher as the curve bear steepens and USD catches a bid which accelerates as US traders walk in. Commodities are rallying across all 3 complexes, with Brent trading back over $68. Yesterday, stocks fell into the bell on Trump comments about not extending the July 9 deadline and possibly not reaching a deal with Japan but recovered their initial losses. Today’s macro data focus is on ADP though it has not been a reliable predictor of NFP.”

VIX opened higher this morning as it consolidates its gain from the Master Cycle low made last Thursday.  Today may be a day of strength, suggesting the VIX may rise toward its mid-Cycle and 50-Day Moving Average at 20.00.

Today we move to the July 9 options chain.  Max Pain is at 18.00.  Short gamma has virtually disappeared while long gamma may start at 20.00 but fizzles out above 30.00 as investors don’t feel the need to hedge.

TNX has risen in a probable corrective bounce from its low thus far.  Both the Cycles Model and Fractal Model suggest another probe lower, probably on Friday or over the weekend.  The Cycles Model actually projects the bottom to occur next Wednesday, just in time for the FOMC to lower rates again. I have made a study of rates and the FOMC reactions.  The FOMC reactions have always been after-the-fact since 1949.  The Cycles Model anticipates rates to start rising next week.

Bitcoin has risen above the 50-day Moving Average at 105100.00 after testing it twice in the past two days.  Should it rise above 108750.00, a potential breakout may occur, giving the green light for a new rally to a possible range of 115000.00.  Bitcoin is traded internationally 24/7.  It has been used as a vehicle for money laundering and moving assets.  For example, the Chinese have been using “Bitcoin in 2024 to move assets from the mainland to the US or another safe haven.  This year the potential for war in the Ukraine and the Middle East may give rise to persons in Europe and the Middle East using Bitcoin as a means of transferring assets out of their countries before international money transfers are outlawed.

ZeroHedge asks, “Will it?

BTC back to big resistance area again, gaining some momentum lately. Let’s see how this develops from here, but BTC has basically been consolidating for a long time. A close above recent highs, and we risk seeing vacuum to the upside again.”

The USD index continues its decline.  While there is a chanced of a reversal here, both the Cycles Model and Fractal analysis indicate a further decline.  In fact, the Cycles Model anticipates a decline to early August.  The next level of support appears to be 93.50.

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 6187.00 this morning, breaking the week-long burst of Cyclical strength in a market showing weakening participation.  Often reversals come on days of trending strength, surprising those investors who haven’t yet realized how thin the ice really is.  The Cycles Model is now showing trending strength on the downside.  The next three days may produce a panic as the majority of investors are now on the wrong side of the market.

Today’s options chain shows Max Pain at 6195.00  Long gamma may begin above 6235.00 while short gamma strengthens beneath 6175.00.

ZeroHedge reports, “US equity futures – which closed at a fresh all time high after the best quarter since 2023 put them in extremely overbought territory – are weaker, dragged by Tech as TSLA is -5% pre-mkt on Musk vs Trump part 2. Pre-mkt, the balance of Mag7 is mixed with Staples outperforming. As of 8:00am, S&P futures are down 0.2% following two successive closes at all-time highs as sentiment remains linked to progress of trade negotiations and the fate of President Trump’s tax and spending bill, which the Senate has failed to pass. Nasdaq futures also drop 0.3% while European stocks also fell. Bond yields are lower as the curve flattens with USD continuing to decline, setting another 52-wk low. As discussed yesterday, the dollar had its worst H1 since 1973 while SPX has its best quarter since 23Q1. Commodities are weaker although gold is soaring. Today is the first piece of the labor market puzzle with JOLTS but we also receive ISM-MFG and vehicle sales. Powell speaks at 9.30am. The voting process on the tax/budget bill continues.”

VIX futures rose to 17.48 this morning.  The Master Cycle bottom was made on Thursday, giving the appearance of a crash.  However, testing the floor gives warning of a possible change in trend.  The Cycles Model calls for a rally in the VIX to mid-August.  The past month has been a great time to accumulate shares in the VIX.  The Cycles Model shows the VIX rising in strength for the next three weeks.  Thereafter, the rally may resume to late August.

Tomorrow’s options chain shows Max Pain at 18.00.  Short gamma remains strong beneath 17.00 while long gamma strengthens above 20.00.

TNX is rising off its low, but it may be early to declare a bottom.  Today is day 251 of the current Master Cycle, suggesting the bottom may come in the next week.  Arguments about the spending bill are threatening a firestorm.  In addition, soft financial data are indicating a possible rate cut in the near term.  The release of the FOMC minutes on July 9 may indicate the bottom of the Master Cycle.

ZeroHedge remarks, “With the passage of President Trump’s so-called “Big Beautiful Bill”—a sprawling new fiscal stimulus and infrastructure package—the U.S. bond market should be in the spotlight, if you ask me.

This legislation, which mostly accelerates deficit spending at a time when debt servicing costs are already surging, is colliding with a Treasury market that has shown persistent signs of instability over the past year. Investors should be watching this space very closely.”

Bitcoin is riding the 50-day Moving Average at 105993.00 this morning.  There is growing volatility that suggests a possible breakdown by the end of the week.  A decline beneath the 50-day triggers a sell signal with repercussions following to the end of the month.

The US Dollar is following the declining Cycle bottom at 96.60 today.  The Cycles Model suggests the buyers’ strike may continue for another month.  Fractal rules put a possible floor on the USD near 93.50.

ZeroHedge observes, “ have endeavored to explain how our economy has changed dramatically over the past 50 years beneath the surface. Nothing that’s going to happen in the future will make sense unless we understand this, so refill your beverage of choice and let’s go through what changed.

Wages gained ground 1945 – 1975, and lost ground 1975 – 2025. In the “glorious 30” (Trente Glorieuses) years of sustained global growth 1945 – 1975, wages’ share of the economy remained around 50% of the nation’s income. As the economy expanded, wages increased in step with the economy.”

The Japanese Yen has rallied above the 50-day Moving Average, giving a confirmed buy signal.  The Yen may continue to rally to mid-July as the USD declines.  This may play havoc on the Japanese economy as it may become more difficult to sell their products to the US.

The Euro continues to rise as money is raised to fund the war in the Ukraine.  This may continue through the end of the week, or possibly longer.  The probable target for this rally lies between 120.00 and 124.00.  Trending strength appears over the weekend, suggesting a reversal may soon follow.

Gold futures rose to 3370.10, challenging the 50-day Moving Average at 3321.15.  This may appear bullish, but the Cycles Model suggests a further decline to mid-July may be in order.  Fractal analysis suggests the lower trendline near 3000 may be the target.

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.

7:15 am

Good Morning!

I am beginning on therapy for cancer this morning, so I only have a short window to communicate my thoughts on the markets.

SPX futures have risen to a weekend high at 6203.40 in an inversion Cycle.  This has changed the near-term outlook on the SPX, but allows the Cycle to turn bearish henceforth.  Today’s range for the Cycle top may be 6200.00 to 6239.00 as a possible upper limit.  Prior to my departure two weeks ago I had mentioned that the Cycles Model had offered no directionality for the past week.  However, this weekend was to mark an uptick in volatility.  This last burst of energy may easily turn into a reversal, as there are fractal limitations that may cut the rally short.  Today may be a test of those limitations.

The 30 Industrials made a weekend high of 44125.00 thus far, short of the all-time high made in December at 45073.00.  This more closely fits the Cycles Model.   The inversion has occurred in all indices, suggesting a uniformity of pattern.

9:26 am

VIX futures rose to a morning high at 17.20.  Note that the low of 16.11 occurred on Thursday, anticipating a possible reversal in the SPX.

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  

Please Note:  I am taking a Summer vacation with my family next week and do not expect to be reporting on this blog for the entire week.

Good Morning!

SPX futures declined to 5919.40 during the Juneteenth holiday, then recovered to 5980.30 this morning.  The calm before the storm is extending into next week with possible gradual erosion of values until mid-week.  SPX is on a sell signal after declining beneath the double trendlines.  further confirmation lies beneath Intermediate support at 5880.35.  Additional support lies at the mid-Cycle and 200-day Moving Average 5831.63.  The Cycles Model calls for the decline to continue to mid-July.  Unfortunately, the market appears calm enough that investors are still buying the dips.  However, wisdom dictates that selling the bounces would be more appropriate.  Trending strength comes roaring back the first week of July.

Tooday’s options chain shows Max Pain at 5990.00.  Long gamma may begin above 6000.00 with strong conviction above 6050.00.  Short gamma starts beneath 5970.00.

VIX futures are still lingering above mid-Cycle support at 19.83.  The 50-day Moving Average is located at 23.61, while the recognized historical average for the VIX remains near 25.00.  Investors remain complacent, while pressure for a breakout is building.

Bitcoin appears caught between the 50-day Moving Average at 104352.00 and Intermediate resistance at 106576.00.  The consolidation may be waiting for a catalyst to make its breakoutor breakdown.  The Cycles Model points at the 4th of July for veritable fireworks moving Bitcoin to its next level.

USD futures remain in a pause that precedes the next move higher.  The Cycles Model suggests the USD may grow in strength as early as this weekend as Europeans begin to move their money to the USD as a haven against a possible war.  A move above the 50-day Moving Average may put the squeeze on a very large crowd of USD shorts, providing fuel for a massive move higher.  The Cycles Model shows the uptrend may last to the end of July, so there is time for a potential move to the Cycle Top at 110.98.

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.

7:45 am

Good Morning!

SPX futures declined to 5942.40 this morning, breaking beneath Monday’s low and potentially increasing the odds of an accelerating decline.  The next visible support is the Intermediate level at 5880.35.  However, the short-term decline may not end until SPX reached the 200-day Moving Average at 5770.21.  The 50-day Moving Average is beneath it at 5692.33.  The Cycles Model suggests no panic until the SPX crosses the 200-day Moving Average sometime next week.  The SPX is on a sell signal.  The FOMC reports “No Change” in the Fed Funds outlook, but remain flexible in the future.

All domestic markets are closed for Juneteenth, June 19, 2025.

Bitcoin continues to ride the 50-day support at 104524.40 this morning.  Support is due to break imminently.  The next level of support is the mid-Cycle level at 95552.28.  The Cycles Model suggests a possible panic situation at the start of the 4th of July holiday.  The decline may continue to the end of July.

The Euro made its final peak on June 12 at 116.32 in a very late Master Cycle high.  The Cycles Model suggests a very steep decline that may last until early September as investors cash out and  take their savings elsewhere.  Some of the risks to European investors include the  Ukraine and Middle East wars, loss of energy supplies and governments going broke with the threat of confiscation of assets under “emergency powers.”  The love fest with Europe may be over.

The Japanese Yen declined to a morning low at 68.60, extending its Master Cycle low by two weeks beyond the median length of a Master Cycle.  Stay alert ot the fact that the Cycles Model suggests a very strong surge out of this low imminently.  The concept of the Yen as a safe haven may take root over the weekend as trending strength returns over the next week.  The rally may be short-lived (three weeks) but powerful as the Yen may be boosted above the Lip of the Cup with Handle formation.

USD futures are hovering beneath the combined overhead resistance at 99.52.  The Master Cycle low was made on June 12 and the Cycles Model implies a very strong push to and above resistance as trending strength appears over the weekend and through next week.  The rally may be fueled by massive short covering as the dollar bears are a very large crowd.

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 have been trading in a narrow trading range during the overnight session.  A sell signal has been made.  The nearest support is Intermediate support at 5868.24.  The mid-Cycle support lies at 5830.12 and the 50-day Moving average lies at 5680.89.  Alarms may not be raised until the SPX declines beneath the 50-day.  This week’s Cycles show a steady erosion.  Next week shows the decline gaining momentum, with some fireworks around the holiday.

Today’s options chain shows Max Pain at 6000.00.  Long gamma may begin above 6035.00 while short gamma resides beneath 5975.00.

ZeroHedge reports, “US equity futures are modestly higher into Fed Day, bucking the trend of lower Asian and European markets, as the market shrugs off geopolitics after the US did not join Israel in bombing Iran and the dip buyers return. As of 8:15am, S&P futures are up 0.1% and Nasdaq 100 futs rise 0.2% even as global equities trade mostly in the red following the 6th day of strikes between Isreal/Iran. Pre-mkt, Mag7/Semis are outperforming; cyclicals poised for a strong day as Financials get a boost from de-reg after Bloomberg reported that regulators plan to reduce a key capital buffer for big lenders to ease constraints over trading in the Treasuries market. Sweden’s Riksbank cut rates by 25bps (expected) while UK CPI was mostly in-line ahead of BoE rate decision tomorrow…FTSE flat/DAX -30bps/CAC -10bps/ Shanghai +4bps/Hang Seng -1.12%/Nikkei +90bps. Overnight, Trump called for Iran’s unconditional surrender/Iran said they will not accept an imposed peace or war and that they will respond “very seriously”/Iran said to be preparing missiles for possible retaliatory strikes on US Bases/worries about the straight of Hormuz where 20% of world seaborne-trade oil supply travels through daily/US announced a meeting on Weds with Pakistan’s army head to discuss mediation. Otherwise, all eyes on FOMC and the dotplot (economists expects them to remain on hold until further clarity about policy/tariff/economic outlook). Treasury yields are lower, the USD weaker, and commodities seeing profit-taking. While the Fed is the focal point of today’s macro data, keep an eye on initial claims and an update to the trend. TIC data at 4pm will show (lagged) foreign ownership of Treasuries. Focus is also on whether the US is planning to get directly involved in the Middle East conflict.”

VIX futures pulled back to 20.50 this morning.  It is currently building support at the mid-Cycle marker at 19.81.  The next phase of the uptrend may be to overcome the 50-day Moving Average at 24.04, where recognition of a change in trend may occur.  Panis may set in toward the end of the last week of June, with an all-out spike around the 4th of July weekend.

The Monthly VIX options expire today with no untoward movement.  The June 25 options chain shows Max Pain at 19.00.  Short gamma resides between 16.00 and 18.00.  Long gamma may begin at 20.00 and remains strong to 30.00.

TNX has tested the 50-day Moving Average at 43.62 this morning.  It may already have reversed and may be due to cross above Intermediate resistance at 44.28, where a buy signal may be confirmed.  The Cycles Mode allows three more weeks of rally with momentum rising through the end of the month.  The FOMC concludes its meeting today  with a press release at 2:00 pm.  No surprises are expected.

US dollar futures are consolidating in the middle of the move higher.  The combined resistance 99.55 may initially repel the advance, but once overcome, a buy signal may be confirmed.  Literally everyone is short the USD.  Recognition of the change in trend may bring on a huge short squeeze.

The Japanese Yen has risen from yesterday’s low at 68.76 and may be resuming its uptrend.  The June 11 Master Cycle low was at 68.74, leaving a double bottom .  Trending strength is gaining and a rally above the 50-day Moving Average rfenews the buy signal.  This clears the way for a strong rally to mid-July.  It is likely  that the lip of the Cup with Handle formation may be exceeded.  What is unique about thsi move is that some investors are beginning to look at the Yen as a safe haven, as opposed to the USD.  This is attracting buyers while some very large hedge funds are shorting the Yen as a source of cheap liquidity.  It is possible that these hedge funds may go belly up in the event of a strong rise in the yen.

Crude oil futures are consolidating after resuming their uptrend.  The price has exceeded the April 2 high at 72.28 and is likely to exceed its Cycle Top at 77.81 by mid-July.  There is no well-defined target yet, although the 2023 high at 92.48 is possible..

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.

9:59 am

The Agriculture Index is now rising out of its Master Cycle low made on Friday.  The rally begins after almost 4 months of sideways correction.  The reversal has yet to be recognized by the mainstream, making it an attractive buy.  The Cycles Model anticipates trending strength returning next week.  In the meantime, inputs into the food chain, such as fuel, are rising dramatically.

8:00 am

Good Morning!

SPX futures have declined to a morning low of 5988.30 as the decline resumes.  Both trendlines have been broken, leaving the SPX on a sell signal.  Ending Diagonals (rising wedges) have a bad habit of completely retracing themselves.  Furthermore, the Cycles Model anticipates the decline to last until mid-July, leaving plenty of time to make deeper lows.  Based on past experience, a minimal target may be the 2023 low at 4103.79.  Major trading desks are turning tactically bearish.

Today’s options chain shows Max Pain at 6020.00.  Long gamma may begin above 6050.00 while short gamma is prevalent beneath 6000.00.

ZeroHedge reports, “US stock futures and global markets are broadly lower on escalation/contagion worries in the Middle East after Trump called for the evacuation of Tehran and cut short his G-7 visit, and yet, as BBG notes, traders don’t seem too perturbed, with futures remaining solidly above last week’s lows, when the conflict between Israel and Iran started. As of  8:00am, S&P 500 futures fell 0.6% at 5:25 am in New York, with Nasdaq 100 contracts -0.6% as all Mag7/Semis are weaker. In main overnight news, Trump left the G-7 in Canada early and later told reporters on Air Force One that he is “not too much in the mood to negotiate” with Iran, and wants a deal that is better than a ceasefire. A draft of the Senate’s version of the budget/tax bill drawing complaints from fiscal hawks and Section 899 features sees its first ex-US backlash with one money manager freezing all long-term investments in the US, per BBG. Elsewhere, the USD is stronger, Treasury yields are lower and commodity prices are higher. WTI crude rose, partially erasing Monday’s loss, while gold stayed near a record high. The Energy complex continues its gains and both Base and Precious have a bid. Retail Sales is the key macro data print today where consensus sees the the ex auto print up 0.3%, an increase from the previous month but the latest BofA card data suggests a miss is on deck.”

VIX futures rose to 20.99 this morning, beneath Friday’s high and the 50-day Moving Average at 24.52.  Most analysts may not recognize the buy signal in the VIX until it exceeds either the 50-day Moving Average or 25.00.  A  likely target for the VIX may be near 100.00.  Should a panic set in, it may go higher.  The end of this Master Cycle may come in mid-July.  Options dynamics may change the VIX as more investors seek to hedge their portfolios.

The June 18 options chain shows Max Pain at 19.50.  While short gamma resides between 16.00 and 19.00,  long gamma begins above 20.00 and ramps higher to 100.00.

TNX opened above th50-day Moving Average at 43.76 snd be showing signs of a reversal higher.  A rally above the Intermediate resistance at 44.22 may confirm the rally.  The Cycles Model suggests it may continue to the week of July 7.  The Cycles Model suggests the short-term target may be above the neckline of the Head & Shoulders formation.  The Head  Shoulders target, should the neckline be overcome, may arrive late in September.

ZeroHedge reports,  “With Thursday a holiday, and the Fed statement on Wednesday, it’s an especially abbreviated week for bond issuance which is why at 1pm today the Treasury sold $13BN in a 19 Year, 11 Month reopening, which was met with solid demand and passed smoothly. ”

Bitcoin is climbing the rising 50-day Moving Average for support, but failed to make a new high.  The Cycles Model suggests Bitcoin may spend the rest of the week in decline.  Furthermore, the decline may continue to the end of July.  A sell signal resides beneath the 50-day Moving Average at 104116.65.

USD is climbing above Friday’s Master Cycle low.  The Cycles Model calls for a rally to early August.  The double bottom in the USD has pulled a lot of speculators on the short side.  Trending strength may return by the weekend, causing short sellers to cover.  This would be essential fuel for a panic rally lasting the next two months.  Options traders have paused their downside bets.

The Japanese Yen is challenging its 50-day M<oving Average at 69.30 this morning.  Whiel threatening Wednesday’s low, it is due today for an abrupt reversal.  The Cycles Model shows rising strength into the weekend with strength maintained through the following week.  The lip of the Cup with Handle formation is at risk of being overcome, offering a strong buy signal.  Each subsequent rally in the Yen puts more carry trade users in a bind, as the payback on those low interest loans come back to bite them.  What is unusual is that the Yen is  being looked upon as a haven in a declining market by investors..

Crude oil futures rose to 72.11 in the overnight session as it resumes its rally through the end of the month.  Trending strength may revisit crude in early July as it wraps up its decline by mid-July.

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.

7:45 am

Good Morning!

NDX futures rose to 21783.50 over the weekend session, but it has stalled short of a new high.  Wednesday marks the secondary high, leaving analysts talking about a double top.  Stock buybacks are being curtailed today as earnings season approaches.  Insiders are selling at a breakneck clip and retail investors have begun to leave.  To cap it off, pensions begin rebalancing today as quarter-end approaches.  The setup is ripe for a correction.  The Cycles Model suggests a decline may be probable lasting through mid-July.

SPX futures have risen to 6016.10 thus far as the Cycles Model suggests a brief touchback at the trendlines between 6020.00 and 6040.00.  The SPX may remain relatively calm, although in decline, for the next week or so.  Panic may set in toward the last week of June and the first week of July.  This decline may be steeper and deeper than the April downdraft.

Today I am scheduled elsewhere.  I may return later with more reports.

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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 plummeted to 5924.50 in the overnight session, then bounced back near 5985.00 thus far.  Yesterday the SPX violated the Diagonal trendline (rising wedge) to offer a sell signal.  Those heeding the technical pattern were rewarded overnight.  The Master Cycle terminated on Wednesday at 6059.40, on time at the 258th day after a complex (zig-zag) retracement.

Today’s options chain shows Max Pain at 6025.00.  Long gamma may rule above 6050.00 while short gamma dominates beneath 6000.00.

Zerohedge reports, “Futures are all lower but already about 100bps higher than overnight lows with all eyes on geopolitical tension in the Middle East after Israel effectively started war with Iran, sending the VIX up to a 20-handle and Gold re-testing ATHs. As of 8:00am, SPX futures are down -90 bps, and trading just under 6,000; Nasdaq 100 futs are down 110 bps with all Mag 7 stocks trading lower (TSLA -2.8%, NVDA -2.0%, GOOG/L -2.0% lagging) and small caps -140 bps Global indices lower, though not dramatically so, with Asia market down ~75 bps overnight and Europe down 100-150 bps at the moment. Dubai/Abu Dhabi markets were down 3/4%. Overnight, the major headlines were Israel’s wide-ranging attack on Iran’s nuclear program and military leadership. Oil up sharply to ~$75 but also well off session highs as so far the initial Israeli attack has avoided energy targets, but Israel could extend over several days, with Iran vowing to retaliate. Also it is unclear if Iran will be allowed to continue smuggling oil to China after this escalation. Crude is up 7.8% from yesterday’s close having surged as high as 13% earlier – its biggest jump in 3 years – and with all CTAs still 100% short this may just be the start of the squeeze. Gold added +0.9%. Yields are mostly unchanged; USD is higher. US economic data slate includes June preliminary University of Michigan sentiment at 10am; Fed officials are in external communications blackout period ahead of June 18 rate decision.”

VIX futures rose to 22.00 in the overnight session, then pulled back, remaining above the mid-Cycle support at 19.70.   It is on a buy signal.  The Cycles Model anticipates the rally may continue to mid-July in Minor Wave A of (3).  The target may be a multiple of its predecessor Wave (1).

The June 18 options chain shows Max Pain at 19.50, with short gamma ruling beneath 19.00.  Long gamma begins at 20.00 and runs strong to 100.00.

USD futures are consolidating near yesterday’s high as it rises from its Master Cycle low made yesterday, on day 258 of the (former) Cycle.   Overhead resistance at 99.66 of the 50-day Moving Average at 99.93 may signal the change in trend to the dollar short sellers.

TNX tested the mid-Cycle support at 43.30 this morning and is rising toward the 50-day Moving Average at 43.65 where the buy signal is re-activated.  Many analysts consider TNX to be in a sideways pattern.  However, a closer examination shows higher lows and higher highs.  The Cycles Model suggests up to 4 weeks of rally may be ahead, challenging the Cycle Top and neckline of the Head & Shoulders formation.

Bitcoin slipped beneath Intermediate support at 106159.00 and is now challenging the 50-day Moving Average at 130188.37.  It has made a sell signal.  The Cycles Model anticipates a steep decline into mid-July.

Gold futures have exceeded its target of 3444.00 this morning as they rose to 3466.00.  Futures are easing back down and may offer a sell signal beneath the Cycle Top at 3429.62.

Crude oil futures vaulted to an overnight high of 77.58, testing the Cycle Top at 77.69.  The Cycles Model anticipates the price of oil to climb until mid-July, where a pullback may be anticipated.  Should the Cycle Top be exceeded, the first possible target may be the 2023 high at 92.48.  Goldman Sachs warns that, “in a worst-case scenario, oil prices could surge to $130.00 per barrel.”  That may match the 2022 high at 126.42 per barrel.