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.

1:49 pm

The strength of the US Dollar may be a product of the declining Euro.  The Euro just broke an inverse Head & Shoulders formation with subsequent follow-through to mid-October.  The EU may attempt to stop the outflow through capital controls.  Government intervention may make things worse.

10:18 am

The Bankng Index continues its decline in strength.  There is a possibility of a bounce at the lower trendline at 165.00 in the next day or two.  However, the upside may be limited.  Panic may set in as bank earnings and outlook are made public next week.  Rising rates have put a serious dent in both earnings and valuations.

8:10 am

Good Morning!

SPX futures climbed to 7709.00 this morning, possibly on its way to a breakout above 7782.19 and a challenge of the previous ll-time high at 7816.79.  The potential target may be the Cycle Top currently at  8004.12.  8100.00+ is possible, depending on the animal spirits that emerge at market peaks.  The Cycles Model allows the rally to resume to the week of October 12.

ZeroHedge reports, “The disconnect continues. With 10Y yields rising as high as 5.34% – a new 24 year high – before easing back US equities remain completely oblivious of the tightening in financial conditions and instead are obsessing with the memory bubble, and pushing higher on the first day of Q4 as strength in technology shares held up against volatility in bond markets and a renewed climb in oil.”

The premarket VIX has eased down to 16.21 this morning, aproaching the 52-day Moving Average at 16.00.  A decline beneath it may increase down-trending strength with the lower trading channel trendline as the primary target.  While crash protection is cheap, it may become incredibly cheaper.

The US 10-year Bond Yield futures have declined to 52.72 this morning while the cash market low remains at 52.79 thus far.   Yesterday’s show of strength may have been a final hurrah, pulling in the last reluctant holdout of the bond bears at the top tick in yields. The Fed is being blamed for the higher rates. Should the decline take hold, TNX may pull back, retesting the neckline of the Head & Shoulders formation at 50.00 in a painful shakeout.

RealClearMarkets suggest, “Financial commentary often makes monetary policy sound mechanical. The Federal Reserve raises interest rates, borrowing costs rise. The Fed cuts rates, borrowing costs fall.

History is considerably messier.”

The US Dollar broke above the Head & Shoulders neckline at 101.80, reaching 102.00 thus far.  This comes as a surprise to the dollar bears, who may be forced to cover their shorts.  The Cycles Model may agree with this thesis, as trending strength may break out as early as tomorrow.  The current Master Cycle remains in place until the week of October 12.

Crude oil bounced from the 52-day Moving average yesterday and rose as high as 92.90 this morning.  It has broken through Intermediate resistance at 91.33 and may be on a buy signal should it close above it.  Trending strength may reappear as early as this weekend as criude may rise above the Head & Shoulders neckline at 106.75.  The probe higher may be particularly strong, lasting to the week of October 12.

ZeroHedge observes, “The refined products crisis remains unresolved as the Northern Hemisphere winter approaches.

Speaking in the Oval Office on Wednesday, President Trump said he holds discussions “every day” about a potential diesel export ban, blaming Russia’s war in Ukraine for fueling the supply squeeze.”

Gold is making a weak bounce. The Cycles Model indicates a possible sideways correction with downside strength near mid-October.

The Ag Index has undershot the 52-day Moving Average at 414.84 this morning.  It may be at a half-Cycle low either today or tomorrow with the fractal formation nearly complete.  A reversal above the 52-day may create a buy signal in a very powerful and long lasting rally.

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.

10:30 am

The Banking Index may be bouncing beneath the mid-Cycle support/resistance at 173.16.  Should it rise above the mid-Cycle, it may rise to the Intermediate level currently at 183.84, depending on how far rates decline. The Master Cycle terminates late in October.  The OFR (Office of Financial Research) is being gutted and still offers out-of-date data, which may be a concern.

ZeroHedge remarks, “The size of the repo market has ballooned to over $13.5 trillion in outstanding agreements daily, according to the government’s Office of Financial Research (OFR). Via the repo market, financial institutions borrow from, and lend to, each other mostly overnight, but also for longer periods, such as for one week, secured by high-quality liquid collateral with a “haircut.””

8:00 am

Good Morning!

SPX futures are hovering near Intermediate support/resistance at 7686.31 this morning.  The 52-day Moving Average lies at 7637.67, which may be the downside target to propel a bounce higher.  The uptrend is intact, but subject to multiple crosswinds.  The economy appears resilient despite rising rates and the prospect of war hasn’t intensified to the point of no return despite aggressions on all sides.  The decline in the price of oil doesn’t bring relief from the stress.  The fractal structure may be incomplete to the upside.  If so, the market awaits the news that signals some relief.

ZeroHedge reports, “Futures are higher with S&P leading both tech and small caps ahead of today’s core PCE data and Micron earnings after the close, as yields remain sticky, unchanged from yesterday’s multi-decade highs, and the USD fractionally lower.”

The premarket VIX is consolidating at the 52-day Moving Averate at 16.04, waiting for a breakout or a breakdown.  The Cycles model suggests “down” for the next move.  The Triangle “tail” may not be fully formed.  It awaits completion at the lower trading channel trendline near 12.50.  Should the animal spirits return to equities, the VIX may undershoot the trendline.

The US 10-year Bond Yield opened lower this morning, signaling rate relief may be at hand.  Should rates relax, they may find support at the neckline of the Head & Shoulders formation.  The Cycle Top also rests there, giving strength to that suport.  A pullbackmay shake out some of the crowded shorts in bonds.

The US Dollar Index has pulled back from its Cycle Top and neckline at 101.83, having reached a high yesterday at 101.61.  USD is also on track for a correction, possibly to the 52-day Moving Average currently at 99.96 in the next two weeks.

Crude oil bounced this morning, but downward pressure is still extant.  The most likely support may be at the 52-day Moving Average at 88.12.  Tankers are moving through Hormuz, Saudi Arabia has restarted its pipeline and Trump may rescind the Russian sanctions in exchange for political prisoners.  What  can possibly go wrong?

ZeroHedge notes, “Texas ranchers and truckers could start seeing some relief at the fuel pump starting this week after Gov. Greg Abbott proclaimed a statewide disaster on Sept. 28 to ease diesel shortages.”

Gold has bounced from round number support at 4100.00 this morning.  The Cycles Model allows an approximate two week rally that may test the mid-Cycle resistance at 4547.17.  It may go higher due to trending strength appearing in the next week.

The Agricultural Index tested last week’s lo and it held.  This supports the thesis of a rising trend as price has found support.  The Cycles Model infers a possible two-month rally that may engage the Head & Shoulders formation.

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 7655.50 overnight, then rose above 7700.00 this morning.  It crossed above Intermediate suupport/resistance at 7688.00 and has reiterated its buy signal.  The Cycles Model has the SPX rising to the week of October 12, but with little conviction thus far.  The Cycle Top resistance rests at 7995.00 and the upper Diagonal trendline lies above 8050.00.  In August I had calculated the upper boundary of the top in the SPX near 8100.00.  That may remain a legitimate view.

ZeroHedge reports, “US equity futures have reversed earlier losses and trade in the green, near session highs, as bond yields drop across the curve, following a decline in oil which has also hit the dollar, despite lack of any tangible news out of Iran and as traders brace for the week’s first labor data following a neverending firehose of artificial-intelligence news and events.”

The premarket VIX slipped lower this morning, but remained above the lower Triangle trendline near 15.50.   The fractal construct allows the VIX to dexcend to the lower trading channel trendline beneath 13.00.  The Cycles Model still makes an allowance for a distinctive tail beneath the Triangle formation.

The US 10-year Bond Yield has pulled back from yesterday’s high and may be due fpr a decline to the neckline of the Head & Shoulders formation.  Bond shorts are very crowded.  The decline in yields may take some negative pressure from equities.  The Cycles Model allows the pullback to reach the neckline of the Head & Shoulders formation during the week of October 5.

ZeroHedge comments, “If you wanted a textbook example of a central bank trapped between a geopolitical rock and a stagflationary hard place, welcome to September 2026. To wit: the ongoing standoff in the Strait of Hormuz is tearing through the global energy market, and the resulting inflation shock is vaporizing the bond market.”

The US Dollar continues its climb towad the head & Shoulders neckline at 101.80.  However, momentume is being lost.  Should a reversal take place, the decline may reach the 52-day Moving Average in the next two weeks.

Crude Oil is testing the Intermediate support at 90.87 this morning.  Should it gain a foothold today, it may resume its uptrend toward the neckline of the Heaad & Shoulders formation.  The Cycles Model indicates a possible dramatic increase in trending strength in October,  indicating that the Head & Shoulders may be activated during that time.

ZeroHedge observes, “Iran is said to have struck a Very Large Crude Carrier in the Strait of Hormuz late on Monday, signaling what will likely be the resumption of strikes on foreign vessels seeking to navigate the Strait of Hormuz, after last week’s diplomatic talks at the UN failed to produce a breakthrough.”

Gold may be bouncing at round number support, relieving the oversold condition.  It may bounce higher, testing the 52-day Moving Average at 4302.95.  The Cycles Model indicates a probable further decline which may last to mid-October.  However, the Cycles Model offers that, if its exceeds the 52*day Moving Average, there may be a long-shot possibility that gold may go considerably higher.

The Ag Index remains hovering above its double reversal low at 416.53.   The significance of that low is that it nearly matches the February 19, 2025 high.  In other words, it may be “proving” its breakout above that significant high.  Should that level hold, the Ag Index may have entered the next phase of its rally.  The Cycles Model indicates that the month of October may prove very strong, especially above the neckline of the proposed head & Shoulders formation.

ZeroHesdge observes, “A heightened wave of federal immigration enforcement in southwest Kansas has sent a shockwave through the U.S. beef supply chain, causing severe processing plant slowdowns, stranding thousands of cattle at feedlots, and threatening to drive up consumer meat prices.”

Bitcoin continues its sideways consolidation.  The trendline through the middle of the chart is beginning to act like a neckline for a possible Head & Shoulders formation.  Should that be the case, the formation may have already been activates with a possible completion by the end of October.  It may act as an escape mechanism for failing economies such as Japan and the European Union.

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 consolidationg above Intermediate support at 7690.04 this mornning.  SPX may be emerging from a minor Trading Cycle low.  The Cycles Model suggsts a possible steady grind higher over the next week.  At htis pace, the Cycle Top at 7990.00 would be an appropriate target in the next two weeks.  While breadth and position are at all-time lows, equities investors are not heading for the exits.

NDX futures declined to 30258.00 over the weekend, but still maintaines its upward bias.  The Cycles Model suggests the new high may be near the Cycle Top at 31950.75.  Options traders continue to chase the upside, while uuder the hood institutions are reducing exposure and hedge funds are actively shorting the NDX.

The Industrials are consolidating after making a late Master Cycle low on Thursday, September 24.  The Cycles Model calls for a steady climb over the next two weeks as investors take notice of positive readings in the blue chips.  Overseas investors near the war  zones may begin moving money to the US as the economic atmosphere becomes more unstable.

ZeroHedge reports, “US futures are lower with Tech underperforming, alongside a drop in treasuries, as fading hopes for an imminent breakthrough in the Iran war sent oil prices higher and reignited worries that inflation is heating up.”

The premarket VIX bounced off the Triangle trendline near 15.00 to a morning high at 16.43.  The fractal formation wawaits completion near the lower trading channel trendline.  As overall equity position has declined, investors have refused to push the panic button.

The US 10-year Bond Yield continues its rally above the neckline of a potential Head & Shoulders formation.  The Cycles Model indicates a possible pullback to the neckline before rates move higher.  An alternate view may be a “running correction” where the pullback may be muted.   Trending strength may return this weekend.

USD is also consolidating as it approaches the Cycle Top and neckline of the Head & Shoulders formation at 101.80.   The Cycles Model suggests a continuation of the rally in the USD until mid-October.  Trending Strength may appear this week, increasing the probability of propelling the USD above the neckline.  Should that occur, a short squeeze of a large magnitude may result.

Crude oil is pulling back from an initial burst of strength originating this weekend.  The rally may resume with little fanfare this week, but activity and strength may pile on over the next two weeks.  A potential Head & Shoulders formation appears overhead.  Should the rally exceed it, the breakout may be forceful.   The Trump administration is considering a voluntary export ban on diesel rather than a mandated one.

Gold plummeted beneath its 52-day Moving Average at 4299.59 today.  It has lost the 52-day support at 4299.59 and is on a sell signal.  The Cycles Model indicates a possible 2-week decline.  The Cycle Bottom at 3856.80 is being watched for a possible breakdown.

The Ag Index  is hovering just above Friday’s low, which did not break beneath the 52-day Moving Average at 413.93.  Should it rise above Intermediate resistance at 425.84, a possible buy signa may be given.  Condirmation of the buuy signal may be given above the Cycle Top at 432.12.

Bitcoin is probing lower beneath the Cycle Top at 86158.00.  This action may be considered a consolidation, awaiting develop ments that may push BTC either above the Cyc le Top at 86159.00 or beneath the trendline and Intermediate support at 79959.00.

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.

8:30 am

Good Morning!

SPX futures resumed their ascent after closing above the Intermediate support at 7690.45, reaching an overnight high at 7739.30.  The Cycles Model suggests a continued rally through the end of the month.  The Cycle Top resistance  at 7983.17 appears to be the target for the rally, with a possible throw-over.  Market behavior often targets round numbers and the trendline near 8000.00 may be a likely goal for investors.

The Industrials bounced this morning to 51577.10 from what may be an extended Master Cycle low.  Should the bounce continue, there may be a chance for a recovery, but the chances of a new ATH may be slim without some defining event.

Meanwhile, NDX futures rose to 30716.60 this morning, with a new all-time high in sight.  The Cycles Model puts the potential target (the Cycle Top resistance) at 31909.47, very close to the upper Diagonal trendline.  Should the animal spirits become engaged, the NDX may go considerably higher.   You can see a very mixed bag among the major stock indices.

ZeroHedge reports, “US futures erased earlier losses and are trading at session highs led by tech, as bonds steadied (with the 10Y at multi-decade highs of 5.17%) after oil’s latest rally lost steam, helping US stocks to extend gains for the week”

The premarket VIX declined to 15.02 this morning, just above the Triangle trendline.  Should it break through, the decline may continue.  There appears to be a strong possibility of a “tail” developing beneath the Triangle formation.  The trading chanel trendline near 12.50 may become the target from this decline.

The US 10-year Bond Yield continued higher, reaching for 5.20 this morning.  The Cycles Model suggests Trending strength may engage TNX today, crossing yet another threshhold.  However, TNX may also be due for a pullback to the Head & Shoulders neckline in the next week.  TNX may become chaotic in the month of October.

Yesterday, Zerohedge observed, “After yesterday’s dismal 5Y aucton which pushed yields to multi-decade highs, moments ago the Treasury completed its last coupon auction of the week, selling $44 billion in 7Y paper. It was another ugly auction, if not quite as ugly as yesterday’s shitshow.

The sale stopped at a high yield of 5.085%, up from 4.512% a month ago and the highest yield on record for 7 Year paper!”

The US Dollar Index pulled back to 100.93 this morning as a minor Cycle low may emerge this weekend.  It may test round number support at 100.00 prior to a continued rally.  A breakout above the neckline may engage the Head & Shoulders formation with knock-on consequences.

Crude oil made a minor correction this morning after a bounce from Intermediate support at 90.36.  The Cycles Model suggest growing strength may ensue wuth the Head & Shoulders neckline in view.  Should it exceed the neckline in the next week, the possibility of engaging the Head & Shoulders formation becomes elevated.

Gold remains suspended beneath the 52-day Moving Average at 4298.30 this morning, but that may not last.  It is overdue for a surge in Trending strength that may break it above that level and surge toward Intermediate resistance at 4407.72.  Above that, a buy signal resides that may last to mid-October.

The Ag Index extended its corrective decline to the last possible day to qualify as a double reversal.   It may meet the 52-day Moving Average at 412.71 before a reversal.  If so, this action may form a 2-month rallythat may engage the Head & Shoulders formation.

The Banking Index may have started a bounce this morning, sending BKX into a possible week-long correction.  Round number resistance at 180.00 may be a realistic target for the bounce.  Thereafter, the Cycles Model infers a possible decline to the end of October.  The Cycle bottom at 148.79 may be a considered 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.

12:54 pm

The Banking Index has bounced at its mid-Cycle support at 173.03 this morning.  The bounce may only last a couple of days, with the decline resuming next week.  Volatility may pick up during October, with the current Master Cycle coming due at the end of the monthll

8:30 am

Good Morning!

I have a meeting this morning.  More details may arrive later.

SPX futures declined to 7647.50, possibly testing the 52-day Moving Average at 7625.42.  The pullback may be over this morning with the reversal taking the SPX higher.  The Cycle Top resistance is at 7973.06.

11:00 am

SPX may have made its low this morning at 7665.49, but remain beneath Intermediate support/resistance at 7689.52.  A probe above 7690.00 lets us know the reversal higher may be underway…

VIX rose above the 52-day Moving Average at 16.09, but may have slipped beneath that support.  The Cycles Model indicates that the decline may resume to the lower trenline beneath 13.00.

The US 10-year Bond Yield has continued its rally above the nckline of a Head & Shoulders formation.  The minimal target may be reached in only two weeks.  Should the H&S formation remain active, there may be a brief retest of the necline before resuming its advance.  However, the next two weeks show trending strength consistent with a possible panic rally.

ZeroHedge considers, “With ‘hard’ economic data still somewhat muted, expectations were for a modest retracement in US PMIs from recently optimistic levels in preliminary September data.

Instead, the ‘soft’ survey data soared:

• Flash US Services PMI Business Activity Index: 58.7 vs 55.8 exp (August: 56.5). 59-month high.
• Flash US Manufacturing PMI: 57.0 vs 53.7 exp (August: 53.9). 52-month high.”

The US Dollar Index continues its rally toward the neckline of its Head & Shoulders formation at 101.80.  The current Mster Cycle may continue higher until the week of October 12, allowing the ability to rise above the neckline.  The Dollar shorts are being squeezed in this Cycle and short covering may propel the USD considerably above the neckline.

Crude oil advanced aggresively to 96.46 this morning, reflecting the return of trending strength.  The Cycles Model suggests a possible panic may visit the oil patch this weekend with more to come in October.  Note the potential Head & Shoulders formation directly above.  While this formation is in a unique location, we must treat thisstructure  as valid.

ZeroHedge remarks, “It was just this month which saw the Iran conflict spill over into a renewed fight between the Saudi coalition and Yemen’s Houthi rebels. Now Iran is threatening to expand the fight further, even into the Indian Ocean.”

Gold made a morning low at 4244.45, remaining above the September 14 Master Cycle low.  Should it remain above that low, we may treat today’s action as a retest of the Cycle low, allowing the rally to re-form.  A probe above the 52-day Moving  Average at 4293.81 offers a potential buy signal, which may be confirmed when Gold rises above Intermediate resistance at 4408.97.  A further rally above the mid-Cycle resistance at 4550.75 leaves the possibility of targeting the cycle top at 5241.14.

The Ag Index is testing the September 14 Master Cycle low.  Once above theIntermediate resistnace at 423.98, the rally may resume.  The buy signal may be confirmed above the Cycle Top resistance at 730.75.

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.

10:24 am

The US 10-year Bond Yield rose to 5.058 – 5.60 this morning, breaking theough the lip of the Cup with Handle formation.  While there may be the possibility of an attempted “slap down” on the rates, the possibility of a significant rally above the trendline exists.

ZeroHedge remarks, “With ‘hard’ economic data still somewhat muted, expectations were for a modest retracement in US PMIs from recently optimistic levels in preliminary September data.

Instead, the ‘soft’ survey data soared:

• Flash US Services PMI Business Activity Index: 58.7 vs 55.8 exp (August: 56.5). 59-month high.
• Flash US Manufacturing PMI: 57.0 vs 53.7 exp (August: 53.9). 52-month high.”

9:53 am

Without much fanfare, the NDX hit 30770.00 yesterday, edging out the June 3 high at 30762.00.   This morning NDX futures rose to 3080060 in the premarket.  The Cycles Model suggests a possible continuance to the week of October 5 after a brief correction.  Bond yields may resume their uptrend and the VIX may put in its Master Cycle low in October.  The tightrope may be fraying.

8:00 am

Good Morning!

SPX futures eased down to 7753.50 this morning, possibly in a test of Intermediate support at 7691.14.  Short-term strength has been spent and a brief dip may be in order.  The Cycles Model suggests the uptrend may revive next week aand continue to the week of October 12.  The Cyclle Top at 7680.00 and the trendline near 8000.00 may be the possible targets.

ZeroHedge reports, “US equity futures are down modestly, but at session lows, as oil reverses earlier losses (crude was on pace for a sixth straight day of declines, its longest losing run in a year) sending Brent back over $100 and pushing 10Y yields back to 4.99%.”

The premarket VIX dipped to 14.12, then bounced.  It is currently hovering near the low.  The Cycles Model suggests the “tail” on the Triangle formation may go lower.  The trading channel trendline points to a target near 12.50.

The US Dollar Index rose to 100.93 this morningas it approached the Cycle Top and Neckline at 101.68.  The Cycles model suggests calm to the end of the month, with Tranding Strength picking up in early October.

The US 10-year Bond Yield pressed against the lip of the “possible” Cup with Handle formation at 50.00.  I am being cautious because the formation is 6.5 years long thus far.  I have been successful spotting 2 and 3 year formations, but this one gives me pause.  It is likely to offer a 2-year forecast, due to its size.  A possible 6-month target may be near 64.00 in the TNX, or 6.4%.  A word of caution.  Bond shorts are loading up, encouraged by the rally in  yields.  But often the market “cleans house” before a big move.  The Cycles Model allows a possible break beneath the Cycle Top at 50.00.  A strong decline to the 52-day Moving Average by the end of the month may be indicated.

ZeroHedge reports, “Ahead of today’s auction, with yields sliding early in the day tracking the drop in oil tick-for-tick, some speculated that participants in today’s sale of $69BN in 2 year notes would need a modest concession to show enthusiasm for the auction. And even though yields did push wider until the 1pm stop, it appears it was not enough and the auction was notably on the weak side.”

Crude oil found support at Intermediate support at 89.39 this morning, resuming its uptrend after a strong shake-out.  Weak investors may not be able to stand the wide swings that commodities produce.  However, the uptrend is intact and may resume its vourse.  The Cycles Model shows increasing strength by the weekend and a possible panic rally to mid-Oxtober.

Gold tested the 52-day Moving Average at 42.89 this morning.  The support held, leaving gold the ability to go higher.  A burst of trending strength may come as early as tomorrow which may test the mid-Cycle resistance at 4551.25.  Should it clear that resistance, gold may develop the ability to rise to the Cycle Top at 5240.90 by mid-October.

ZeroHedge observes, “China’s real gold purchases appear to be roughly twice the amount disclosed through official channels, according to Goldman Sachs’ latest estimate.”

Bitcoin may have found support at the Cyclle Top at 85175.00 this morning.  It appears to be poisd to launch higher with an average target at the 50% retracement level at 91753.00.  However, Trending Strength may reappear this week giving us a better understanding how far it may rise.  The Cycles Model infers the counter-trend may continue to the end of Oactober.

The Ag Index may be testing its double reversal low at 421.91.  That low may also qualify as a Trading Cycle low, inferring that a rally may develop that may exceed the neckline of the Head & Shoulders formation.  The current Master Cycle apppears to be longer than normal. possibly extending to the end of November.

The Lord’s Prayer

Our Father, who art in heaven, hallowed be thy name.  Thy Kingdom come, Thy Will be done, on earth as it is in heaven.  Give us this day our daily bread and forgive us our trespasses, as we forgive those who trespass against us.  And lead us not into temptation, but deliver us from evil.  Amen.

8:15 am

Good Morning!

SPX futures continued to rise to 7780.60 this morning, possibly on its way to 7800.00, where there may be short-term resistance.  Thereafter, the equities Cycle remains uneventful to the end of the month.  Whether it maks a new all-time high in September may be questionable.  However, the Cycle picks up activity in October.  The Short squeeze may be over and retail buying may be fading as the market may be waiting for new money to arrive.  The target remains near 7970.00 to above 8000.00.

ZeroHedge reports, “Futures are flat, having recoverd  a modest drop after the European open, following yesterday’s strong, positive performance despite energy prices and yields being lower for a second consecutive day.”

The  premarket VIX is consolidating beneath the Triangle trendline near 15.00.  The Cycles Model calls for a sideways-to-lower glidepath over the next week.  The lower trendline of the short-term trading channel lies near 13.00 and may decline to 12.50 in the next couple of weeks.

The US 10-year Bond Yield broke beneath its consolidation zone nd declined to 10.23 this morning.  It may bounce temporarily at the Cycle Top at 49.05.  However, the decline may resume later this week with growing downside momentum.  The decline may have two more weeks to go with a possible target near the 52-day Moving Average at 47.27 or the trendline near 47.00.

The US Dollar Index may be losing some of its upside momentum after making a high at 100.67 this morning.  A retest of the 52-day Moving Average at 99.92 may be in order for the rest of the week.  Trending strength may not arrive until early October.

Crude oil declined to 89.16 thid morning, setting up a potential bounce at Intermediate support at 88.92.  Should the bounce occur, the uptrend may regain its strength by the weekend.  A Head & Shoulders formation may have emerged in the past week that may clarify the direction of crude oil over the next six months.

ZeroHedge observes, “UBS analysts warned that the global diesel squeeze could get worse as two major suppliers potentially pull barrels from an already strained petroleum products market. Russia may extend diesel export restrictions through October, while chatter in Washington about a US fuel export ban continues to grow.”

Gold bounced at the 52-day Moving Average at 4284.00 this morning.  This action may reinforce the potential for gold to move higher.  Trending strength may come into play later this week, sending gold to test the mid-Cycle resistance at 4552.31.  Should it exceed that level, a higher rally may result.

The Ag Index challenged the Cycle top at 429.27 this morning before pulling back.  Once above it, a buy signal may be made with the neckline of the Head & Shoulders formation in sight.  The current master Cycle is a long one, lasting to the end of November.  The likelihood of making that target is substantial.

ZeroHedge observes, “As Donald Trump’s war on Iran nears the seven-month mark, the economic damage is reverberating all over the world, and all across the United States. Among the Americans who are feeling the most pain from a war their federal legislators never declared are the nation’s farmers, who are growing increasingly desperate under the weight of rising costs for diesel, fertilizer and equipment.”

ZeroHedge notes, “The shift happened gradually, then all at once.

By late 2024, analysts at Langley and Fort Meade who had spent careers tracking terrorist cells and nuclear programs found themselves redirected to spreadsheets showing fertilizer shipments, satellite passes over Ukrainian wheat fields, and soil moisture readings from the Sahel. Nobody had issued a memo announcing the change.”

BKX, the Banking Index, may be continuing its decline to the mid-Cycle support at 172.97 this week.  Should it hold, a brief bounce may be generated.  A lack of support at that level may allow the BKX to decline to its Ending Diagonal trendline near 163.00.  With little fanfare, liquidity is draining out of the economy.

Bitcoin has pulled back from yesterday’s high at 87336.00 and may be consolidating above its Cycle Top support at 84993.00.  While Bitcoin may go higher, a decline beneath the Cycle Top may produce an aggressive sell signal.  A further decline beneath the trendline at 80600.00 may confirm the sell.

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.

10:20 am

The Banking Index has bounced as relief from higher interest rates may bring short covering.  The fractal formation suggests a further decline to the mid-Cycles suport at 172.92 before a larger bounce.  The decline may remain orderly until October, when a panic Cycle may appear.  Stress in the banking system has not appeared in the media until this morning.

(Reuters) – The US and UK central banks have asked global banks about ​their exposures to large trading firms after turmoil ‌at a hedge fund caused large losses at proprietary trading firm Jane Street in July, the Financial Times reported on ​Monday.

8:20 am

Good Morning!

SPX futures rose to 7706.40 this morning, above Intermediate resistance at 7685.49, confirming its buy signal.  Trending strength may appear today as shorts scramble to cover.  Investors are looking for the next best thing, but may not realize the cost of capital rules all.  The next resistance is the Cycle Top at 7955.41 and the upper Diagonal trendline near 8000.00.  The Cycles Model shows possible gains through mid-October.  The questions is, will animal spirits take over?

ZeroHedge reorts, “US futures are higher driven by Trump / Xi optimism around AI, Middle East, and trade with Middle East kinetic headlines over the weekend reflecting a pause to escalation.”

The premarket VIX is back-testing the Triangle trendline near 15.00 this morning.  Should it remain beneath the trendline, it may continue in a declining glide path for the next two weeks.  Volatility has collapsed toward its one-year floor.  However the collapse may become more extreme as this Triangle formation may develop an even lower “tail.”

The US 10-year Bond Yield futures declined to 49.42 this morning, while the cash market bottomed at 49.51 thus far.  While it apears that yields are holding steady, the short-term trend may be down.  In a correction, yields may drop to the 52-day Moving Average at 47.19.  The process my take up to two more weeks to wring out the overbought condition.

The US Dollar Index may be taking a rest  and possibly retesting the 52-day Moving Average at 99.92 before moving higher.  It appears that it may continue a steady rise toward the Cycle Top once the testing has been done.

Crude oil may be completing its correction this morning as trending strength may be making an imminent comeback.  The next resistance area may be the Cycle Top at 112.43.  However, that may not be the final probe in the current Master Cycle.

ZeroHedge observes, “President Trump’s “Donroe Doctrine” positions energy security in the West as a key pillar of US national security.

The removal of socialist Nicolás Maduro and the subsequent massive Venezuelan oil deal represent the opening act in a longer-term effort to rebuild production and secure supplies closer to the Gulf of America.”

ZeroHedge advises, “Military conflicts, economic wars, and resource wars are converging ahead of the Northern Hemisphere winter.

Export restrictions on critical materials and energy products are adding economic pressure worldwide, raising the risk that supply disruptions and retaliatory measures widen existing conflicts. With no clear path to de-escalation, the potential for spillover from active war zones remains top of mind.”

Gold has turned back at the Intermediate resistance at 4393.42 this morning.  The bounce isn’t over, but gold may retest the 52-day Moving Average at 4281.17 before moving higher.  While the normal correction may take gold back to its mid-Cycle resistance, the Cycles Model shows approximately 4 more weeks of rally with increading strength, suggesting the Cycle Top resistance at 5241.32 may be in play.

The Ag Index may have made it reversal after making a correcitve low on Friday.  Should the Ag Index go higher, this may qualify as a “double reversal,” essentially part of the same Master Cycle that shows the top less than two weeks ago at 460.39.

Bitcoin used the horizontal trendline as support for today’s move higher.  It has challenged the Cycle Top at 84604.00and remains above it thus far.

Zerohedge observes, “Bitcoin has surged above $85,000 this morning for the first time since late-January…

The rally comes alongside advances in stocks and bonds, as falling oil prices and optimism ahead of a summit between US President Trump and China’s Xi Jinping are buoying markets more broadly. Rival digital assets have also bounced.”

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.

9:20 am

Good Morning!

SPX futures rose to test Intermediate resistance at 7680.76 this morning.  It may pull back to the 52-day Moving Average at /610.41 before moving higher.  The pullback may be short-lived, as the Cycles Model suggests a burst of trending strength (short squeeze) may re-appear over the weekend and into next week.  Today may be a highly volatile day right up to the close as the indexes rebalance and  quad witching day makes its debut.

ZeroHedge reports, “US stock futures are little changed on Friday, with big tech stocks rising while sentiment is supported by another modest decline in oil prices; a near-record $7 trillion quad-witching and index rebalances add to Friday’s set-up.”

VIX declined through the 52-day Moving Average , confirming its sell signal.  The target may be the bottom trendline of the Ending diagonal formation near 12.50.  The Cycles Model allow approximaely 3 weeks for the VIX to reach its target.

The US 10-year Bond Yield futures reached 49.94 this morning,as it tests the Heaad & Shoulders neckline at 50.00.  The necklne resistance may hold on this attempt, sending TNX down to support in 2-3 weeks.  The first level of support is the Cycle Top at 48.87.  Should TNX  not go lower than the Cycle Top, the immediate effect may be a rally above the neckline.

The US Dollar continues its rally off the Madter Cycle low.  The Cycles Model allows the rally to continue to mid-October, putting the Head & Shoulders neckline in its path.  Today may be a particularly strong day, with follow-up strength in early October.  The Dollar shorts are becoming uncomfortable as a squeeze may develop.

Crude oil has reversed out of its correction and may be headed higher.  The Cycle Top is in sight and trending strength may return next week.  Thr current Master Cycle may last until mid-October, suggesting the February high may be its final target.  Refineries may switch to diesel production instead of gasoline due to a wider profit margin.

ZeroHedge explains, “How taxes, regulation, refinery closures, sanctions and declining domestic production turned a geopolitical shock into a diesel-price crisis

Do not blame diesel prices on the Iran war or the disruption of the Strait of Hormuz. The geopolitical risk premium attached to oil prices is relevant, but the market was already weakened by policy choices.”

ZeroHedge notes, “A major refinery in the US Midwest went offline this week after a power outage, adding to global refining disruptions as US diesel prices reach record highs.”

Gold has pulled back from Intermdeate resistance at 4399.00 this morning.  The Cycles Model is neutral for about a week, suggesting a sideways-to-declining correction.  The bounce may resume next week with the mid-Cycle resistance at 4556.71 as a potential target.

The Ag Index has declined through its Cycle Top support at 427.41 and may be headed for Intermediate support at 419.16.  The Cycle allow up to 2 weeks to perform a double reversal.  That period may come to a close next week.