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.

10:35 am

Volatility is spiking as SPX reached a low of 4835.04, then spiked up 8.5% within a half hour on rumors of a 90-day pause in the tariffs.  It is now back beneath 5000.00 and sinking fast.  It appears that we may see a 10% down day from here.  Capitulation may rule the day.

7:45 am

Good Morning!

NDX futures traded down to 16332.50 this weekend before a bounce this morning.  Friday’s close was beneath the mid-Cycle support at 17428.00, leaving it vulnerable to a further decline.  An important support to point out is the 1987 trendline near 15000.00.  Should today be another 10% down day, we may see a bounce at that trendline.  However, a failure to hold at 15000.00 today assures the decline may extend to the next support level at   10440.00.  The Cycles Model calls for a possible high velocity reversal by Wednesday.  Commentators are now discussing past bear markets.  There is no sign of capitulation, yet.

SPX futures plummeted to a critical support at 4802.70 this morning, then bounced to 5000.00.   The selling isn’t over yet.  Should SPX find today’s support at 4800.00, this crash may have the same magnitude as the 2008 decline.  Failure to hold today at 4800.00 suggests a much larger magnitude decline may ensue.  This may bring on capitulation, where everyone is headed for the exits.  Further supports today include 4744.00, 4660.00 and 4500.00.  The Cycles Model suggests a high volatility reversal no later than Wednesday.

Today’s options chain shows Max Pain at 5300.00.  SPX options are deep in to short gamma.  There are put walls of 5000 contracts or greater starting at 4950.00 and every 50 points down to 4500.00.  The reason for the morning bounce was to enable dealers to short SPX futures as payouts may explode.

ZeroHedge reports, “US equity futures are pointing to another day of staggering losses – even as they rise from session lows – as Trump doubled down on sweeping tariffs and as the world continues its flight to safety. S&P futures had plunged as much as 5.5% around the time Europe opened but the stock selling stampede abated as traders boosted expectations for Fed rate cuts amid economic fears just days ahead of Trump’s deadline for reciprocal tariffs to take effect. The rout accelerated late on Sunday after President Trump struck a defiant tone and repeatedly defended the tariff barrage unveiled last week. His remarks underscored those of his top economic officials, who on Sunday doubled down on Trump’s plan, dampening risk sentiment further. Some comments this morning by Jamie Dimon urging a quick resolution to the trade war, helped calm sentiment. As of 8:00am S&P futures are down -2.6% with Nasdaq futures dropping around 3.0% but there is zero liquidity so it’s pretty much impossible to ascribe a snapshot to what is happening. The yield curve is bull steepening, with 5x rate cuts now fully priced in by YE25. USD is flat and commodities are being sold with Energy complex the biggest laggard, though oil is also well off session lows. The VIX is rising again, and is around 50, while oil falls below $60/barrel for the first time since April 2021 on fears that demand will collapse. Ten- and two-year Treasury yields are falling with traders pricing in five Fed cuts this year and a possible emergency move. This is a light macro data week with CPI on Thurs the highlight as earnings kick off later this week, although nobody will care about anything besides tariffs and trade war.”

The VIX index rallied to 60.13 this morning at the European open before calming down somewhat beneath 50.00.  Investors are paying top price for protection that may be needed in the next couple of days.  The next resistance is the August 5 high at 65.73.  Further resistances may include 75.95 and 85.78.  The VIX term structure is showing extreme stress.

The April 9 options chain shows Max Pain at 22.00.  Short gamma remains between 16.00 and 21.00.  Long gamma begins at 24.00 and peaks at 30.00.  This op-ex is catching VIX traders by surprise.

TNX reversed out of its Master Cycle low on Friday and continues its climb toward the mid-Cycle resistance at 42.12.  TNX only has two weeks in the new Master Cycle.  However, it may prove to be a powerful rally, despite the short duration.

Bitcoin extended its decline beneath the March low.  The Cycles Model suggests the decline may extend for another week.  Should the strength of the decline continue, bitcoin may test the August 5 low near 48200.00.

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.

10:57 am

SPX may have completed Path 1.  The low thus far was 5118.78, accomplishing the target of 5119.25.  There may be another test of the low.  If the trendline holds, there may be a 2-week rally that may test the 1987 trendline at 5500.00.  A buy signal may be offered above the Cycle Bottom resistance at 5330.08.

Should the SPX  go lower, here is a likelihood tat SPX may be taking path 2, which  allows a much deeper decline.

10:26 am

BKX is crashing.  The problem is that the current Master Cycle has at least another week to go.  The next support at 101.05 may not hold at this rate.  Should BKX go lower, the next support may be near 70.00.

10:11 am

NDX continues its pace of decline to a possible target at 17435.00, potentially entering the bear Market (-20%).  It has fallen through the Cycle Bottom support and the August 5 low appears to be the next support level.  A Goldman trader quipped, “…the world/market is changing every 15 minutes…”

8:00 am

Good Morning!

SPX futures made a morning low of 5174.40 thus far, shoeing the characteristics of a third Wave.  However, there are  at least two alternate paths being proposed by today’s action thus far.  The first (and highest confidence) path is a low today near the August 5th low at 5119.26, ending the current Master Cycle on day 262. This suggests a two-week rally in the new Master Cycle before rolling over into a panic decline.

The Second path suggests the Master Cycle may have completed early on March 25 (day 252). That suggests a two week further decline in the new Master Cycle.  This infers a take-down of sorts that may go much lower.

SPX is deep into short gamma with massive put holdings every 50 points down to 5100.00.  The largest is 35,469 put contracts at 5100.00.

ZeroHedge reports, “For a few hours it seemed like we could even stabilize, if only a bit, ahead of today’s scheduled main event: the March jobs report at 8:30am ET. And then all hell broke loose at 6:08am when this Bloomberg headline hit:

• *CHINA ANNOUNCES EXTRA 34% TARIFFS ON US GOODS

In other words, far from seeking concessions, Beijing is now looking to escalate the trade war further, and forcing Trump to double down with even harsher retaliatory tariffs on China of his own, which at this point may push the blended tariff rate on Chinese goods above 100%.

What followed instantly was sheer, unadulterated liquidation panic:

• *S&P 500 FUTURES DECLINE 4.1%, NASDAQ 100 FUTURES DOWN 4.6%
• *COPPER PLUNGES MORE THAN 5%, BIGGEST LOSS SINCE JULY 2022
• *US 2-YEAR YIELD FALLS TO 3.498%, LOWEST SINCE SEPTEMBER 2022
• *BRENT OIL DROPS BELOW $65 FOR FIRST TIME SINCE AUGUST 2021
• *US CREDIT RISK GAUGE JUMPS MOST SINCE REGIONAL BANKING CRISIS
• *STOXX EUROPE 600 INDEX FALLS 5.2%, MOST SINCE MARCH 2020

Instead of writing, we’ll let the charts do the talking, summarizing the bloodbath so far. The S&P is set to record losses on six of the past seven weeks.”

VIX futures rose to 32.68 this morning, but eased back under 30.00 at this writing.  While the SPX is making record lows, the VIX hasn’t panicked, yet.  Should the SPX decline to 5100.00, the VIX may very well match the August 5 high at 65.73.

The April 9 options chain shows Max Pain at 22.00.  Short gamma resides from 16.00 to 21.00.  Long gamma occupies the space from 23.00 to 30.00.

Bitcoin did not reach a new low in the overnight market.  Instead, it may  have reversed course to go higher.  Should that be so, a new buy signal may be made with a rally above Intermediate resistance at 84882.00.  Bitcoin has another week to go in its current Master Cycle.  The potential target may be the 100-day Moving Average at 93045.41.

TNX futures made a morning low at 38.60 while the cash market made a low of 38.86, very near the rising trendline beneath it.  Today is day 260 in the Master Cycle, very near the 258-day average.  What may come next is a 2-week reversal that may challenge the Cycle Top.

Gold May have made its Master Cycle top yesterday, at 3163.99 on day 260 of its former Master Cycle.  Today is fell to a low of 3089.00 before a minor bounce.  The Cycles Model suggests a 1-month decline which may break the uptrend.  A sell signal may be obtained beneath the Cycle Top at 3050.00.

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.

1:30 pm

SPX may have made its Master Cycle low at 5415.66 (cash) late this morning.   It may make yet another low before today’s session is closed.  However, chances of nailing the exact low are slim.  It’s time to find a spot to cover shorts and go long.  Good trading!

10:25 am

SPX is headed for the 2-hour Cycle Bottom at 5408.70 today.  This may be the area to cover shorts and go long.  A lot of people are guessing what comes next.  Most are extremely bearish.  “Throwing in the towel” may be a good indicator of a change in trend.

ZeroHedge observes, “Apple shares are plunging almost 10% in premarket trading, as the iPhone maker is viewed as especially exposed to the Trump administration’s tariff announcements.”

7:45 am

SPX futures plummeted to an overnight low of 5440.10 as Trump delivered the “Declaration of Economic Independence” after hours, leading to massive selling of Tech names and hedge fund shorting across the board.  The decline still has the ability to go near  5400.00 (revised) today.  However,  be prepared for a strong reversal near mid-day.  Today is day 261 of the Master Cycle, suggesting a reversal may be imminent.  This is the position from which to cover shorts and go long for an approximate 3-week correction after six weeks of decline.

Today’s options chain shows Max Pain at 5650.00.  Long gamma may begin above 5675.00 while short gamma rules beneath 5600.00.

ZeroHedge reports, “Well, Trump’s “liberation day” is here… and it has liberated countless traders of their net worth and risk assets: the market’s reaction to Trump’s newly-instituted “much worse than expected” reign of tariffs is nothing short of a bloodbath, with a global selloff hitting stock markets everywhere but especially in the US where conventional wisdom, at least early on, is that the recession will be worst. As of 8:00am ET, S&P futures are down 3.5%, while Nasdaq futures tumble 4%, but should really be down more: Pre-market, AAPL (-7.5%), AMZN (-5.6%) and TSLA (-4.6%) are among the worst performing stocks within Mag 7, which is red across the board. As Trump unveiled yesterday (after the close), all US imports will have a minimum 10% tariff, with additional duties for big trading partners. China faces a tariff of well above 50% on many goods; the EU is subjected to a 20% levy. Bond yields crash in anticipation of a looming recession, down 4-10bp lower across the board, the Bloomberg US Dollar index is down -1.6%, set for its biggest drop . Commodities are all also sharply lower: WTI -3.9%, silver -3.4%, even gold is back under $3000. On today’s calendar we get initial and con continuing jobless claims as well as the latest ISM Services data.”

VIX futures rose to 24.03 this morning and may challenge the Cycle Top resistance at 25.10.  Today is day 258 of the current Master Cycle, suggesting a reversal may also be imminent.

The April 9 options chain shows Max Pain at 19.00.  Short gamma resided at 16.00-18.00.  Long gamma begins at 20.00 and extends to 30.00, where it is quite strong.

Bitcoin rose to its mid-Cycle resistance at 284.56.  It has up to two weeks left in its Master Cycle.   The Cycles Model suggests the Bitcoin may go higher, with the 100-day Moving Average at 93206.87 as a potential target.  There are no alternate views at this time.

TNX futures declined to an overnight low of 40.33, potentially making its Master Cycle low on day 259 of the current Cycle.  The Cycles Model suggests an approximate two weeks of rally from the low.  What makes it unique is that there are several indicators of strength in the next two weeks.

USD extended its Master Cycle low today to 101.07 futures and 101.37 cash.  The decline may be complete, or nearly so.  The USD suffered a sharp decline since Trump announced his new tariff policy.  However, with that behind us, adjustments may be made that may normalize the USD position.  The Cycles Model suggests a rising USD through mid-May.

The Nikkei 225 Index plunged beneath 35000.00 in overnight trading, dropping as low as 33729.50.  There is a double Head & Shoulders formation here that indicates serious weakness in the Nikkei.

The EuroStoxx 50 Index fell over 3% in overnight trading toward the ETF mid-Cycle support at 51.17.  It has been on a sell signal the past week, so this shoul not be a surprise.  The Cycles Model suggests the decline may continue through the month of May.

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.

8:05 am

Good Morning!

SPX futures have declined to a morning low of 5581.50 thus far.  While the risk remains that the SPX may decline to the Cycle Bottom at 5343.93, today is the day to begin shedding the shorts.  Trump’s “Liberation Day” looms big at 4:00 pm.  No matter how this is spun, the effect of the tariffs may do much for the US economic image and attract even more capital to the DJIA while lesser amounts may funnel into the SPX and NDX.  The majority of the money will go into the 30 Industrials because these stocks are the most stable.

Today’s options chain shows Max Pain at 5645.00.  Long gamma begins at 5660.00 while short gamma resides beneath 5600.00.

ZeroHedge reports, “Stocks resumed their slide and Treasury yields held near one-month lows with just hours to go before President Trump’s tariffs tariff announcement, amid swirling speculation over the details of the proposed trade action. As of 8:00am, S&P futures traded 0.5% lower; tech underperformed sending Nasdaq futs down 0.7% with Mag 7 all lower with TSLA (-1.0%) and NVDA (-0.6%) being the biggest laggards; Newsmax dropped 25%, pausing a blinding IPO rally that briefly pushed the company above Fox Corp. European and Asian stocks both slumped.  The Dollar sank and the yield on 10-year Treasuries was steady after falling on Tuesday to the lowest since early-March. Commodities are mixed: base metals are lower, while precious metals are mostly higher (silver +1.0%) and gold just shy of its record high. All eyes on the Rose Garden event “Make American Wealthy Again” at 4PM with Trump delivering his announcement on tariffs. On today’s data calendar, we get ADP (exp. 120k) and Factory Orders (0.5%, ex trans 0.4%).”

VIX futures reached a morning high at 21.98, remaining beneath the Cycle Top at 25.08.  Equity drawdown risk remains high for the next few days, suggesting the VIX may go higher.  However, today is day 257 in the Master Cycle, suggesting a turn lower by the end of the week.

Today’s options chain shows Max Pain at 19.00.  Short gamma resides between 16.00 and 18.00.  Long Gamma begins at 20.00 and has large footprints all the way to 30.00.

The 10-year Treasury Note futures sank to 41.22 this morning.  Today is day 258 in the Master Cycle, suggesting a strong reversal may be imminent.  While there are no immediate indicators of a low, the Cycles Model suggests a Master Cycle low may be in place by the end of the week.  A cross above the mid-Cycle resistance at 42..16 offers a potential buy signal for higher yields.

Bitcoin may be consolidating beneath Intermediate resistance at 85070.00 this morning.  The probable pathway for the next week may be to rise as high at the 100-day Moving Average at 93387.29 prior to a strong reversal.

Gold futures may have reached a lesser high this morning at  3166.69, short of yesterday’s high at 3177.00.  The numbers are not yet final, due to the tariff announcement after the close.  So we wait for the CME close and the announcement.  Futures may reach the trendline at 3200.00 tonight while the cash market remains lower.

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″55 pm

SPX may have completed its initial bounce.  If so, there is the possibility of a retest of today’s low.  A decline through the 1987 trendline may signal a continuation of the decline while a bounce above it confirms the three-week reversal.

10:18 am

The Ag Index is emerging from its Master Cycle low last Friday.  It is on an aggressive buy signal that may not be confirmed until it rises above the Intermediate resistance at 389.79.  However, the bounce from the trendline and ,id-Cycle support at 370.93 confirms the reversal.   This is one asset class that is on the rise for a long time.

9:55 am

BKX continues its decline that may last to mid-April.  Liquidity may be more influenced by the 10–year Treasury yields than the stock market itself.

7:45 am

Good Morning!

NDX futures have declined to a morning low of  18963.30 thus far as domestic indices are at day 258 of the Master Cycle. The decline may reach its intended target near 18407.66 in the next 24-48 hours, followed by a tradable 3-week bounce back to the mid-Cycle resistance at 20366.38.  This has been the worst first quarter and worst month of March for NDX since 2022.

SPX futures have declined to 5507.90 thus far this morning.  Should SPX decline beneath its 1987  trendline, a 3-week bounce may elevate it back to the mid-Cycle resistance at 20366.72, with a future bearish path to follow.  However, should the SPX bounce at or above the 1987 trendline near 5480.00, the 3-week bounce may go considerably higher.

Today’s options chain shows Max Pain at 5595.00.  Short gamma begins beneath 5575.00 and extends to 5475.00.  SPX is currently beneath a massive wall of puts exceeding 45,000 contracts at 5565.00.  No catalyst is needed to push the SPX lower.

ZeroHedge reports, “US equity futures and global markets tumbled on the last day of the worst quarter for US stocks in 23 years as the April 2 “liberation day” comes into sharp view. As of 8:00a, S&P futures are down 1.1% after Trump dented hopes he would limit the initial scope of levies set to be unveiled on Wednesday, telling reporters aboard Air Force One he plans to start with “all countries” leading to Goldman promptly slashing its S&P price target for the second time in weeks, now seeing the index dropping to 5300 in 3 months; Nasdaq futures tumbled 1.6% driven by heavy selling of the Mag 7 stocks (NVDA -3.2% and TSLA -4.1%). It wasn’t just the US: Europe’s Stoxx 600 slid 1.2% and Asian stocks suffered sharp losses, with the Japan’s Nikkei 225 index losing 4% and Taiwan’s stock index falling into a correction. Bond yields are 4-7bps lower; the USD was lower at first but has since rebounded . Commodities rise across the board: gold trading up 1.1% to a new record high of $3120, with base metals mostly higher, and Brent above $74. This week, all eyes are on April 1st (all studies related to trade policy will be completed) and April 2nd (reciprocal tariff announcement, sectorial tariffs such as pharma, semis and commodities, the resumption of 25% tariffs on USMCA-compliant goods). We will also receive ISMs and NFP this week.”

DJIA futures have declined to a morning low at 41241.50 thus far.  I am showing a weekly chart, since the DJIA bullish impulse may not be complete.  The 1987 trendline is not shown on the daily chart since the DJIA is still a considerable distance beneath it.  This chart shows that the bullish impulse may not be complete until the DJIA reaches 48000.00.  It is possible that the next three weeks may elevate the Industrials above the recent highs with 48000.00 possible by the end of April.

Why is the bullish outcome for the DJIA possible?  Aside from having an incomplete fractal, the DJIA is considered the safest haven in the world at this time.  War may be breaking out in Europe and the Japanese economy is failing.  Investors in those two regions may choose to flee to the safest investment possible.  While US treasuries may attract some cash, the DJIA offers the best long-term safety net.  As the war drums in Europe beat louder, investors there may be fleeing the crumbling political and economic train wreck to a place of relative safety in the US.

VIX futures rose to 22.42 this morning.  The odds of making a new high are substantial.  However, it may be end end of the Master Cycle as well.  Trade it if you wish, but have your exit close at hand.

The April 2options chain shows Max Pain at 19.00.  Short gamma resides between 15.00 and 18.00.  Long gamma may begin above 20.000 and extends to 32.00.  Options investors have been slow to hedge until now.  Unfortunately new hedges may be trapped by a sudden reversal.

TNX has continued its decline beneath the mid-Cycle support at 42.16.  However, the current Master cycle is on day 256, suggesting a reversal may be imminent.  So, although there is a sell signal, it is not likely to be tradable.  What is to follow, ay be imminently tradable as TNX may be due for a two-month rally following the potential reversal.

Bitcoin continues its consolidation with two more weeks left.  It is possible that the consolidation may end in a high near Intermediate resistance currently at 93583.34.

Gold futures rose to a morning high at 3160.14 while the CME trades closer to 3100.  A possible reversal may be made over the next 2-3 days.  Once the reversal is made, gold may be traded lower over the next month.  A likely target may be near the lower trendline at 2800.00.  Should it remain above the trendline at the end of April, gold may actually go higher.  However, once beneath the trendline, the futures become more bearish.

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.

11:54 am

SPX has been unable to make an appreciable bounce at 5600.00, leaving the possibility of continuing the decline toward the 1987 trendline this afternoon.  SPX is in deep short gamma, forcing the dealers to go short as well to cover the expiring puts at the end of the day.  This morning I mentioned a “wall” of puts at 5675.00.  That is not the end of them.  Here are the major layers:

5675.00 – 13681 put contracts

5650.00 –  17134 put contracts

5600.00 – 11503 put contracts

5500.00 – 9911 put contracts

There are multiple layers of 5000+ contracts between these layers.  Once the market “let’s go” there is little to stop the carnage.  No catalyst is needed.

ZeroHedge remarks, “Are Democrats trying to spark a recession by cr”ashing the stock market with their insanely partisan and outlier-ish survey responses?

10:37 am

The Ag Index has reached its target at 370.85 today, on day 252 of its Master Cycle.  It is possible a week early with some additional downside to go.  However, this is an ideal place tto accumulate shares of agricultural commodities, or buy a basket of commodities through an ETF.  Now that the lustre has worn off equities, food producing commodities offer a tangible alternative.

10:10 am

BKX has crossed beneath mid-Cycle support at 123.07 and is testing the 200-day Moving Average at 121.52, creating a potential sell signal.  The Cycles Model suggests a decline may be in order until mid-April.  Should the BKX decline beneath the 200-day, the target may be the Cycle Bottom at 101.61 in a rather sharp decline.  The Cycles Model infers multiple bouts of trending strength over the next two weeks.

9:55 am

The EuroStoxx 50 is going lower.  The ETF has crossed beneath Intermediate support at 55.29, creating a sell signal.  Those investing in EuroStoxx seeking maximum gains may see losses, instead.

ZeroHedge remarks, “A few harsh realities to consider: 

1) The hard-left has infiltrated all Western institutions and actively seeks to undermine and subvert all Western nations – regardless of which particular puppet politician is in power.

2) Most countries within Western Europe will see their native young become a minority well before 2050. …”

8:00 am

SPX futures declined to 5665.00 before a bounce which hasn’t regained lost ground thus far, having crossed beneath the 200-day Moving Average at 5757.00.  This action generated a new sell signal.   The Cycles Model indicates growing trending strength starting next week that may allow the SPX to pierce the 1987 trendline.  Should that be so, the fractal pathway appears to lead the decline to 5100.00, approaching bear market territory.  Volume has been thin thus far, as investors take a wait-and-see approach.  However, volume may accelerate as SPX begins to make new lows, crossing the trendline.

Today’s options chain shows Max pain at 5725.00.  Long gamma may begin above 5750.00 while short gamma rules beneath 5700.00, with a massive put wall at 5675.00.  Dealers and hedge funds are already asking the Fed to bail them out in the next crash.

ZeroHedge reports, “US equity and global stock markets slumped while gold topped a fresh all time high as investors braced for today’s core PCE report, the Fed’s preferred inflation metric, and continued to worry about the lasting economic damage of the trade war amid daily tariff news and a halt in progress on the geopolitical front, as the market now awaits the April 2 tariff announcements. As of 8:00am ET S&P futures are down 0.2% but off session highs, with the Nasdaq lagging -0.4% and small caps modestly higher; Mag 7 names are mostly lower premarket: AAPL -0.7%, AMZN -0.5%, while TSLA +1.6%. European and Asian stocks are also lower: Bond yields are lower and the USD trades near session highs. Commodities are mixed with base metals all lower this morning, but gold is making a new record high rising above $3,080 per ounce. Brent trades near session highs above $74/bbl. Looking ahead today, we will get PCE data for February at 8:30am (consensus expects headline and core PCE up 0.3% MoM, and 2.7%/2.5% YoY headline/core) followed by UMich survey data at 10am. Following the data, we will hear from Fed voter Barr and non-voter Bostic.”

VIX futures rose to 19.58 in the overnight session.  In doing so, it has risen above the 50-day Moving Average at 18.61, creating a buy signal.  The next move may be substantial, as the length of third waves are often multiples of Wave 1.  VIX may meet or exceed the height of the August 5 rally.

The April 2 options chain shows Max Pain at 18.00.  Short gamma occupies 15.00-17.00.  Long gamma may begin at 20.00, but only extends to 24.00.  The options market may be about to wake up.

TNX is pulling back impulsively with a potential target at the mid-Cycle support at 42.17.  Pullbacks such as this are typical after a breakout.  Investors are interpreting this as a resumption of the sideways trend  However, once TNX meets its target the Cycle will flip upward in a dramatic way by early next week.

ZeroHedge reports, “Moments ago, the Treasury sold the week’s final coupon auction and after a stellar stopping through 2Y sale, a mediocre, tailing 5Y, today’s 7Y was the ugliest of the lot.

Stopping at a high yield of 4.233%, the auction yielded 0.4bps more than February and also tailed then When Issued 4.227% by 0.06bps; this was the first tail for the 7Y tenor since August 2024.”

Bitcoin has pulled away from the mid-Cycle resistance at 87698.70 and has fallen beneath Intermediate support at 85904.08, creating a sell signal.  The Cycles Model suggests a decline until mid-April that may hit or exceed the Cycle Bottom support at 60775.03.  Should that be so, the alternate target may be the August 5 low at 49202.91.  Bitcoin has been favored by investors to expatriate their wealth away from countries such as China and some European countries.  That impulse has already seen its peak and the onset of capital controls may now have the opposite effect.

USD futures are consolidating beneath the mid-Cycle resistance at 104.89.  The Master Cycle bottom was made on March 18 and the USD may be about to launch a 6-7 week breakout rally soon.  Note that both USD and the Yen are set to rally simultaneously.

The Japanese Yen has marked a Master Cycle bottom yesterday, signaling a potential resumption of the uptrend.  As the Yen appreciates, those who have been using the Yen carry trade for financing may get squeezed.  Note the potential target should the neckline be breached.

Gold is fast approaching its  Cycle high as futures top out at 3124.40 while the CME trades about $50.00 lower.  The initial target of 3100.00 has been met (futures) and there are only a few days left in the Master Cycle.  Futures are trading higher due to foreign demand, while domestic demand is lagging.  Gold prices may decline through the month of April.  The initial target may be 2300.00.  A decline beneath the Cycle Top at 3010.00 may invoke an aggressive sell signal (reduce exposure).  A confirmed sell signal may lie beneath Intermediate support at 2945.00.

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.

10:21 am

The Ag Index is aiming for support at 370.80 by early next week.  This is a good time to accumulate shares of Ag commodities as a reversal may be imminent.  This is one of the few investments that have recently established an uptrend and have a good distance to go.  Note the possible Head & Shoulders target.  Despite improving conditions, food and food products may see much higher prices.

10:09 am

The EuroStoxx 50 is heading lower after making a Master Cycle high on the 18th.  It has crossed beneath both the Cycle Top at 56.01 and challenged Intermediate support at 55.21, creating a possible sell signal.  Those seeking to make the gains made since November should lock them in.  Analysts now suggest that Europe is now a contrarian trade.

9:51 am

Liquidity is faltering as BKX declines to support at 122.98.  Should it decline beneath that level, a sell signal may be generated.  The Cycles Model allows the decline to continue to mid-April.  The Cycle Bottom at 101.39 is a possible target.

8:00 am

Good Morning!

SPX futures reached a low of 5684.60 this morning, before a bounce above 5700.00.  It is hovering within short gamma which begins at 5730.00.  The 1987 trendline appears near 5470.00 and is directly in the path of this decline.  The potential target of this decline may be near 5100.00, which is marked with a horizontal trendline.  The Cycles Model suggests a 2-3 week sharp decline ending with a bounce that may remain beneath the 1987 trendline.

Today’s options chain shows Max Pain at 5740.00 with short gamma beginning beneath 5730.00.  This is a dangerous situation for the longs, since trading volumes have been thin as investors are losing heart over the losses thus far.

ZeroHedge reports, “US stock futures faded earlier gains, but were also off session lows after a tariff-driven selloff in equities on Wednesday which hit the Mag7 names. Futures on the S&P 500 are flat after Trump announced 25% uniform tariffs on auto imports, while Nasdaq futures dropped 0.3% amid a reversal of the Monday price action as investors seem to be back to the recession playbook ahead of April 2 announcement. Mag 7, Cyclicals and High Short Interest are among the worst performing baskets, while Defensives outperformed. AI and data center names faced a slew of negative catalysts so far this week, including NVDA’s China environmental curbs, sell-side report on MSFT lease cancellation, BABA’s comments earlier this week: NVDA-5.7%; JPM’s Data Center basket -3.0%. Commodities are higher led by oil and base metals. Outside the US, China ADRs outperformed US domestics with KWEB up 54bps today as China PBOC adviser promised (once again) that China will ramp up stimulus if growth falters.”

VIX futures surged to 19.18 before pulling back, still within positive territory.  The Fractals are now subdividing as VIX may probe much higher.

The April 2 options expiration show Max Pain at 18.00.  Short gamma occupies space between 15.00 and 17.00.  Long gamma begins at 19.00 and strengthens at 24.00.

TNX has lurched above Intermediate resistance and the descending trendline, creating a buy signal.  Today is day 252 of the current Master Cycle, leaving about a week to continue its ascent.  It is likely that the 50-day Moving Average at 44.32 may have an effect on the probe higher.  However, the trendline may also provide support.  The Cycles Model suggests a 2-week retracement in mid-April before TNX powers higher.

ZeroHedge observes, “Hot on the heels of yesterday’s stellar 2Y auction, moments ago the Treasury sold $70BN in 5 year paper in an auction which may not have been quite as impressive at first sight, but which was nonetheless just as solid when taking a closer look below the surface.

The auction stopped at a high yield of 4.100%, down from 4.123% last month and the lowest since September; however, it also tailed the When Issued 4.095% by 0.5bps, the first tailing 5Y auction since October.”

Bitcoin is consolidating/;correcting beneath its mid-Cycle resistance at 87593.52.  While the correction appears complete, there may be 1-2 more weeks before a reversal.  A possible target may be the 500-day Moving Average at 89581.24.

Gold futures powered up to 3094.85 while the Continuous Contract on the CME lags behind.  Gold may have reached its initial target near 3100.00 today, day 253 in the Master Cycle.  There is still room to go higher, but time is running out on this rally.  There is no signa, so we await further developments.

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.

10:34 am

BKX has reached its 50%retracement value at 128.59 this morning.  It may overshoot to the Intermediate resistance at 129.48 before reversing.  The Fed has been paying particular attention to the health of the banks.  However, should interest rates (10-year) continue to rise, it may add stress to banks’ balance sheets.

8:30 am

Good Morning!

SPX futures are flat this morning.  While the SPX is in the reversal window mentioned yesterday, it may linger on a flat line a few more days.  It appears to be caught between the mid-Cycle resistance at 5780.45 and the 200-day Moving Average at 5754.41.  The 50% retracement is at 5827.31, which may be tested in a final probe ending the Cycle.  Diminished liquidity and the buy-back blackout leaves equities in a neutral position.  Investors are looking for alternatives to the US equities market.  Frankly, the US market has done as well as its has because overseas investors are fleeing to the US due to the poor political outlook in Europe, among other places.

Today’s options chain shows Max Pain at 5765.00  Long gamma appears above 5795.00 while short gamma strengthens beneath 5725.00.

ZeroHedge reports, “US equity futures are flat, reversing earlier losses while global markets were mixed (Europe down, Asia up) as investors awaited more clarity on US tariff plans and the economic outlook before Donald Trump’s April 2 “Liberation Day” deadline to impose a fresh reciprocal tariffs. As of 8:00am ET, S&P futures were up 0.1% following modest gains on the indexes on Tuesday, while Nasdaq futures were flat as Tesla and Nvidia shares edged lower, pressuring the Mag 7. Europe’s Stoxx 600 index dropped 0.5%. Bond yields are 1-3bp higher and USD is higher. Commodities are mostly higher led by oil and base metals. Copper futures in New York surged to a record high (up 1% now after easing off records) as traders priced in the possibility of hefty import tariffs that may come within several weeks. Headlines were mostly quiet since market close yesterday.  Today’s economic calendar includes Feb durable goods orders at 8:30am; Fed speaker slate includes Kashkari (10am) and Musalem (1:10pm).”

VIX futures are higher this morning, but lingering near the mid-Cycle support/resistance at 17.63.  It may touch the trendline at 16.51 before a reversal takes place.

The April 2 options expiration shows Max Pain at 18.00.  While short gamma is much diminished, long gamma shows interest at 24.00.

TNX is challenging Intermediate resistance and the descending trendline ar 43.58 this morning.  DOGE is “lifting rocks” to see what is hidden from public view and finding funds being paid out with no authorization.  Reducing the deficit is becoming more difficult due to off-the-books outlays.

ZeroHedge observes, “In 1974, Congress created the Legal Services Corporation to connect lower-income Americans involved in civil disputes with free legal help. The law that established the agency stipulated that authorization for its funding would expire in 1980, when lawmakers were required to vote on whether to keep it alive.

They never did. Still, Congress has funded LSC every year since. In fiscal 2025, its 51st year, LSC’s 135 employees will spend 95% of its now $560 million annual budget paying legal groups to represent Americans in cases such as eviction, domestic violence, and disputes over government benefits, according to Ron Flagg, the agency’s president since 2020.”

USD continues to rise off its March 18th Master Cycle low.  The Cycles Model suggests trending strength may surge higher as the Cycles Model suggests multiple significant events occurring over the next week.

Gold futures are higher this morning, as the price rises to challenge the existing high.  Round number resistance at 3100.00 may be a likely target, but a surge to the trendline near 3200.00 cannot be eliminated over the next week.  Gold reacts to political uncertainty and there is plenty to go around.  While physical gold demand remains strong, the US Dollar is showing signs of resurgence that may stifle gold’s attraction.

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 an

Good Morning!

SPX futures have hit a high of 5778.90 thus far and may go higher in the next day or so.  The reason is that SPX is on day 252 of the Master Cycle, nearing completion within the reversal window.  A further observation is that the previous Master Cycle was 5 days late, on day 263, allowing the turn to occur early in this Cycle and remain close to the average Cycle length.  My earlier analysis before my trip was that the SPX would make a Master Cycle bottom this week.  What a difference two weeks make!  The main reason for this change is the NATO is preparing for war.  European citizens are sending their money overseas where it is safer and not subject to possible capital controls that may be forthcoming in a wartime economy.  A clampdown on money fleeing Europe may be imminent.   European chat forums are being shut down.  In the meantime, US assets are benefiting from capital flight.  It is possible that this bounce may target Intermediate resistance at 5874.39.

Today’s options chain shows Max Pain at 5750.00.  Long gamma dominates above 5770.00.  Short gamma strengthens beneath 5700.00.

ZeroHedge reports, “US equity futs are little changed, erasing a modest loss earlier in the session when investors took some profits from yesterday’s torrid rally which pushed the S&P 1.8% higher. As of 8:00am ET, S&P and Nasdaq futures are both up 0.2%, with Mag 7 stocks all higher pre-market, led by TSLA (+1.4%). European stocks gained as the Estoxx 50 rises 1.1% led by energy and financials, although Asian stocks dropped for a third straight day of losses, driven by Chinese tech shares trading in Hong Kong slid 2.6%, weighed down by a drop in Xiaomi after its $5.5 billion share sale. Investors were also rattled by Trump’s new threat of “secondary tariffs” on countries that buy oil from Venezuela. Bond yields are 1-3bp higher. Commodities are mostly higher led by precious metals (silver) and oil. WTI crude oil futures add about 0.5% to Monday’s 1.2% gain. Today, we will receive consumer confidence at 10am ET (est 94.0 survey vs. 98.3 prior).”

VIX futures are coming down, reflecting money flows that dampen volatility.  VIX is approaching its turn window the may not be realized until a reversal in equities.  A decline to 16.00 may occur in the next week.

Tomorrow’s options chain shows Max Pain at 20.00.  Short gamma is dominant between 15.00 and 19.00.  Long gamma begins at 21 and remains strong to 35.00.

TNX is on the rise again, testing Intermediate resistance and the trendline at 43.57.  A breakout may give a buy signal.  There is approximately a week left in the current Master Cycle.  A breakout may cause yields to challenge the January high.  Analysts believe that the bond market is exhibiting mean reversion behavior experienced over the last six months.  The Cycles Model suggest this may change…

globest.com reports, ““In my talks with [the president], he and I are focused on the 10-year Treasury [yield],” Treasury Secretary Scott Bessent said in February.

EuroStoxx may be in their final probe to a new high this week.  The Cycles Model suggests the final high in Stoxx may be Friday, suggesting the events leading to a European conflict may come to a head as early as this weekend.  European investors have little choice in where to put their money as the bond market is in tatters there.  Banks are not too far behind, so investing in stocks is not being made for the return, but for some capital preservation.  While the European market looks enticing, capital controls may trap investors’ money when the tide turns.

The USD made its Master Cycle low on March 18.  It is currently consolidating above the low, but has mid-Cycle resistance above it at 104.89.  A buy signal may be made above that level.

Gold futures may be on their way to a final high near 3100.00 or higher in the next week.  A possible probe to the upper trendline near 3200.00 appears likely.  Gold is also benefiting from capital flight from Europe, but may cease soon as capital controls are initiated by European governments..

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 5633.50, then bounced.  It may have embarked on a path to lower levels.  It is possible that the 1987 trendline has already had its bounce 50 points above it at 5504.66.  If so, this decline may go beneath the trendline at 5450.00.  Should that be the case, we may see at least two limit down days in the next week-and-a-half.   The target appears to be 5100.00, but may be lower.  Today we see a $4.7 trillion options expiration with $2.8 trillion in the SPX that may have consequences over the next week.

Today’s options expiration shows a huge options wall of both puts and calls at 5700.00 (Max Pain).  Long gamma takes over above 5725.00, while short gamma reigns beneath 5680.00.  It may be a bloody battle for supremacy.

ZeroHedge reports, “US equity futures are lower, as are European and Asian markets, with sentiment after the latest batch of earnings after yesterday’s close were mostly mixed or negative (particularly Fedex and Nike, both of which guided lower again). S&P500 futs are down 0.2%, off session lows, with the index facing an additional test on Friday in the form of a huge option expiration quad-witching. Nasdaq futures dropped 0.3% with all Lag 7 names lower led by NVDA -1.2%, and TSLA -0.7%. Micron reversed an earlier gain after reporting earnings after hours and was down 3%-premarket amid margin weakness. 10Y Treasury yields are down 4bps while the dollar reversed an earlier gain. In commodities, oil markets are already feeling the effect of the first effort to target a vast private processing industry, with traders preparing for significant disruption after Washington’s move to sanction a Chinese refiner over its Iranian links. London’s Heathrow airport will be closed all day Friday and service interruptions are likely to continue for days after a nearby fire cut power to the hub and brought travel to a standstill. Today, the macro data calendar is largely quiet, with eyes on any additional headlines from the White House.”

VIX futures are consolidating at the lows.  However, today’s options expiration may prove to be very active.  At a minimum, VIX may rise to the August 5 high during the next week.  The Cycles Model suggests a high in the first week of April.

The March 26 options expiration shows  clear bifurcation between puts and calls at 20.00.  Short gamma occupies the 15.00-20.00 range, while long gamma dominates the 25.00-30.00 range.

TNX declined to a morning low of 41.99 before a bounce that may propel it much higher.  Thus far it has remained beneath the declining trendline at 43.67.  The Cycles Model infers that a burst of trending strength may emerge this weekend that may propel TNX above that trendline, giving a buy signal.  The Fed’s reduction of the run-off cap from $25 billion to $5 billion may end QT for treasuries.

The Banking index stalled just above the mid-Cycle resistance at 122.38.  A decline beneath it may spark a continuation to round number support at 100.00 over the next 2-3 weeks.