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.

10:20 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.

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 rose to 7623.60 thus far this morning this morning, back above the 52-day Moving Average at 7608.48.  This may be construed as a buy signal as the terminus of the old Master Cycle may have been put in yesterday.  This arrives after sentiment reached an all-time low.  The Cycles Model infers the rally may resume to mid-October.  The targets shown on the chart (7945.00-8000.00) may be anticipated, with a possible throw-over, as the animal spirits may rise with the market.

ZeroHedge reports, “Stocks look set to recover from Wednesday afternoon’s selloff asmarkets digest the rate hike from the Federal Reserve with Warsh (in retrospect) calming markets with a rate hike and tough talk on curbing inflation. ”

The premarket VIX declined to 15.64 thus far, beneath the 52-day Movng Average at 16.20.  This may create a sell signal.  The new Master Cycle may be short, so only the diligent should take this signal.  Having said that, the usual target may be the Ending Diagonal trendline near 12.50.  However, should the SPX throw-over, the VIX may throw-under near 11.50.

The US 10-year Bond Yield declined from yesterday’s close beneath the Lip of the Cup with Handle formation.  The TNX Master Cycle terminated on September 15, leaving approximately 3 weeks for the new Master Cycle.  A likely target for the decline may be the 52-day Moving Average at 47.03.

ZeroHedge comments, “What’s behind the numbers?

After the Federal Reserve had fractured into factions, that the dual mandate had become a contradiction, that three hawks were in open revolt and an employment wing was massing for the autumn, the Committee raised rates by a quarter-point to 3.75–4.00 per cent — the first hike since 2023 — and did it unanimously.”

TheEpochTimes via ZeroHedge comments, “Despite a lot of talk about fiscal responsibility, lawmakers in Washington are continuing to run up the tab on America’s already maxed-out credit card.”

The US Dollar Index rose to 100.37 this morning, creating a stir among the dollar shorts.  While its has pulled back near the 52-day MovingAverage at 99.95, it may be gearing up for another surge of strength over the weekend.  The Cycles Model suggests a continued rally to the week of October 12.  The Head & Shoulders neckline may be a considered resistance to overcome.

Crude Oil pulled back on news of possible de-escalation this morning.  However, the Cycles Model infers a possible violent resumption of the uptrend.  The rally may continue, in strength, until mid-October.  The Cycle Top at 112.20 may be the next hurdle to overcome.

ZeroHedge advises, “Goldman Sachs commodity experts Yulia Zhestkova Grigsby and Daan Struyven warned in a Wednesday note that the global diesel crisis is tightening gasoline supplies as refiners prioritize higher-margin diesel production. This shift raises the risk of further gasoline price increases ahead of the US midterm elections. The US national average diesel price has already reached a record $6.40 a gallon, adding to household and business fuel costs.”

Gold has begun its bunce this marning.  The Cycles Model suggests the bounce may extend to the week of October 12.  It is noteworthy that the USD and Gold are rising together.

The Ag Index may be going back for a retest of Tuesday’s low at 426.79.  Should it hold,   The Cycles Model suggests an unusually strong turn higher.  The fact that it is finding support on the Cycle Top is remarkable, in that the ensuing rally may be a record breaker.  The current Master Cycle may extend the rally to Thanksgiving day.

Bitcoin may have found support at its Intermediate level at 76045.00 and bounced to 77085.00 this morning.  The Cyclles Model appears neutral over the next week, suggesting it could go in either direction.  However, trending strength may return by the following weekend.

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 rose to test the 52-day Moving Average at 7607.17 this morning without ectending the decline in the overnight session.  A rise above the 52-day offers a buy signal for the SPX.  NDX appears to be in a similar position, beneath its 52-day Moving Average at 29191.00.  All eyes are on the Fed this morning with the consensus of a possible .25%  rate hike.

ZeroHedge reports, “Futures are higher into Fed Day where consensus is for a 25bp hike, the first since July 2023, with unknown levels of communication, and the question is what the dot plot shows (see preview here). S&P 500 futures are up by 0.3%, finding relief after days of selling as traders wait Kevin Warsh to deliver an expected interest-rate hike that will help ease fears that inflation may spiral.”

The premarket VIX held fast at yesterday’s low at 16.79.  The Cycles Model allows three more weeks of decline toward the bottom trendline of the Ending Diagonal (wedge) formation.  The target appears to be near 12.50, but it may probe lower, approaching the Cycle Bottom.

The US 10-year Bond Yield has slipped back beneath 50.00 this morning after making a marginal new high yesterday.  The bond market awaits the FOMC news release to see how serious Warsh is about containing inflation.

The US Dollar paused at its high, awaiting the outcome of the FOMC news release.  While there is the possibility of testing supports at 99.40 and 99.22, the trend is still higher.  The weekend may bring a surge in trending strength to the USD.

Crude oil futures have pulled back as it tests suport, possibly near 101.00.  The Cycles Model implies the uptrend may resume by the weekend in strength.  The Cycle Top resistance at 112.11 may be the next target.  Keep in mind that there may be a month left in the rally, suggesting the February high may be the next target after a brief correction.

ZeroHedge remarks, “Diesel futures and refining spreads climbed to record highs as worsening supply disruptions in the Gulf and Russia tightened availability of the industrial fuel that powers the global economy.”

Gold has bounced from its 52-day Moving Average this morning, ending the prior Master Cycle and beginning a new one.  The new Mster Cycle may last a month in a corrective rally.  Short term resistance may be found near the Intermediate level at 4376.00 while longer term resistance lies at the mid-Cycle level at 4554.70.

The Ag Index may be rising from its swing low.  While it may venture lower, the bounce may qualify as a double reversal Cycle low, as it may happen in a two-week span.  The irony is that food rices may resume a substantial rise to the Thanksgiving holiday.

ZeroHedge remarks, “Following last month’s ugly decline (“see the consumer is getting crushed because of Trump”), August’s retail sales is expected to rebound strongly…”

Bitcoin has resumed its decline, challenging Intermediate support at 75638.00.   The Short term outlook may be neutral, but be aware that the 52-day Moving Average is at 71582.00 and rising.  The aggressive sell signal remains pendig a decline beneath the 52-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.

8:10 am

Good Morning!

SPX futures declined to 7573.80, a nominal new low.  The Cycles Model had suggested that the September 10 low may have been the ideal date for a Master Cycle low.  However, the Fractal Construct may reach completion today, which is allowed by the Cycles Model as an extension that completes the Fractal formation.  In fact, the Fractal construct may allow a decline to 7550.00!  Thus time and price must both be met to allow a reversal.  In the meantime, the old favorites are being traded in for new models.

ZeroHedge reports, “Futures are lower – but well off session lows thanks to some well-time oil sell orders just before US traders walked in to work – as bond yields continue to make new highs, with both Nasdaq and Russell lagging the S&P which feels like more de-risking into tomorrow’s Fed release.”

The premarket VIX is consolidating inside yesterday’s trading range beneath the mid-Cycle resistance at 18.24.  While elevated, this is not (equities)bear market behavior, especially after putting in the Master cycle high on September 10.  The Cycles Model may allow a 3-4 week decline toward the lower Trading Channel trendlinenear 12.50.

The US 10-year Bond Yield futures rose to 50.47 thid morning, while the cash market topped out at 50.14.  The yields are challenging the FOMC meeting as I write.  It is believed that the stated the Fed rules show that the Fed Rate at 3.50-3.75  should be at 3.79 to 6.01.  The prognosis is that the Fed may only raise rates to 3.75-4.00, leaving the Fed well behind the market.  The Cycles Model calls for a reversal, but it may not occur until the FOMC minutes are released.  The aftermath may be a 3-week correction down as far as the 52-day Moving Average at 46.84.

The US Dollar Index is consolidating this morning above Intermediate support at 99.41.  It is on a buy signal that may last to mid-October.  The Cycles Model shows increasing strength through this weekend.

Crude oil is in a correcting pattern that may evolve into a new surge toward the Cycle Top at 111.83.  The Cycle Top may not be the final target for this Master Cycle.  The next target may be the February high, as there are four more weeks to the Cycle terminus.

ZeroHedge observes, “President Volodymyr Zelenskyy said on X that Ukrainian forces struck the Syzran refinery in Russia’s Samara region, about 75 miles west of Samara and 466 miles southeast of Moscow. The strike comes days after President Trump urged Ukraine to halt attacks on Russian refineries, as average US retail diesel prices jumped above $6 a gallon and alarming disruptions to global refining capacity threaten fuel supplies ahead of the Northern Hemisphere winter.”

Gold may have made its master Cycle low yesterday at 4253.71, testing the 52-day Moving Average at 4264.77.  A reversal may have been set in motion that may last 3-4 weeks.  A possible target may be the mid-Cycle resistance at 4554.56.

The Ag Index may have reversed at the Cycle Top support at 424.54 nearing a possible end to the correction.  The Cycles Model anticipates a ossible surge in volatility that may reverse the direction.  If so, the Ag Index may rally 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.

7:50 am

Good Morning!

SPX futures challenged the 52-day Moving Average and trendline at 7602.88 this morning, bouncing back above it.  This is causing consternation among traders and hedge funds that have been buyers 10 of the 11 last weeks.  SPX did not decline beneath Thursday’s low at 7580.06.  The Cycles Model favors the low made last Thursday as the Cycle bottom.  However, the next few days may be borderline, testing the low.

ZeroHedge reports, “US futures are sliding, dragged by fears of a possible AI development slowdown as well as higher oil prices (Brent > 108), though bond yields are not reacting yet (10Y yield still under 5%).”

NDX futures declined to 28804.50 this morning, beneath the lower Triangle trendline near 2900.00.  Should the Triangle be valid, today’s action has created a “tail” that is common to the final probe within that formation.  The probe lower may be perceived by many as a breakout/down.   While Thursday’s low in the SPX fit the parameters of the Master Cycle to perfection, today’s low in the NDX also qualifies to complete the Master cycle.

The premarket VIX rose to match Friday’s high at 18.17, but did not exceed it.  A decline beneath the 52-day Moving Average may offer a sell signal.  Should this be so, the Cycles Model implies a possible month-long decline to lower values in the VIX.

The US 10-year Bond Yield rose to 49.85, matching, but not excceding, Thursday’s high.  A decline from this point may confirm the Master Cycle and an approximate three-week correction.  A possible Cup-with-Handle formation may be in the making, with a substantial rally above the lip.

The US Dollar rose above its mid-Cycle resistance at 99.20 this morning, confirming buy signal.  The Cycles Model infers that the rally may last another 4 weeks with the Cycle Top/trendline as an initial possible target.

Crude oil forged ahead, creating a new high.  The Cycle Top at 111.74 may be in sight, as ther is still time in this Cycle to go higher.  What it does at or Above the Cycle Top may tell us what could be in store in the future.

ZeroHedge remarks, “Brent crude futures jumped overnight after Saudi Arabia shut its East-West pipeline following drone attacks last week, threatening a critical route for bypassing the highly contested Strait of Hormuz chokepoint and a loss of what could amount to 4% of global supply.”

Additionally, ZeroHedge warns, “As of Monday morning, AAA’s national average retail diesel price topped $6.23 a gallon as a global refining crisis sparked by the Russia-Ukraine war and compounded by the Gulf conflict sent the price of the most critical fuel powering the industrial world skyrocketing.”

Gold declined to 4266.00 this morning, which may have complete the current Master Cycle.  This may allow a possible bounce that may last a few weeks.  The bounce may propel gold to its mid-Cycle resistance at 4554.67 in that time.

The Ag Index may have bounced off the 52-day Moving Average at 423.61 this morning.  Should that be correct, it may exceed the neckline of the revised Head & Shoulders formation.  A new formation target has been calculated.  Should this analysis be correct, the new Master Cycle may extend to the end of November.

Bitcoin may be making a brief correction after having declined beneath its support low at 76300.00.  Cycle resistance lies at the 80000.00 trendline. The possible downtrend may be confirmed by a possible panic decline starting as early as tomorrow.

BKX may have broken its trendline at 186.00.  Should it not recover above the trendline, it may degenerate into a panic decline by the weekend.  A dceline beneath the prior low at 103.48 may confirm this observation.

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.

11:15 am

Good morning!

SPX has risen off its Master Cycle ow t his morning, a possible beginning of a 5-week rally to a new all-time high.  The Cycle Top resistance is currently at 7933.17 while the upprer Diagonal trendline is near 8000.00.  There is a strong likelihood of a throw-over beyond 8000.00.  Higher interest rates may be temporarily  damping animal spirits.  But efforts are being made to keep interest rates in check.

ZeroHedge made this report early this morning.”Futures are higher thanks to an overnight retreat in oil prices (which is unlikely to hold now that Houthi rebels effectively control the entire Red Sea) and bond yields which track oil tick for tick, but the tone could quickly shift with the week’s biggest catalyst, August CPI data, due before the cash open.”

Laater, after the CPI print , ZeroHedge commented,  “Following fuel-driven jump in Producer Prices, consensus was for a concomitant jump MoM in Consumer prices this morning, after last month’s decline as energy prices have rebounded (though we warned that amid all the interventionist-y chatter, nothing would surprise us less than ‘cool’ print to offset the PPI scare).

And analysts were right with headline CPI rising 0.4% MoM (exactly as expected) – biggest MoM since May – but prices rose 3.5% YoY (in line with expectations and flat to the prir month)…”

VIX calmed down consierably, beneath the 52-day Moving Average at 16.16 and giving a sell signal.

The US 10-year Bond Yield rose to 5.005 early this morning, but the cash market topped out at 49.85 terminating the ageing Master Cycle.  The Cycles Model offers approximately 3 weeks of relief, allowing TNX to decline to the Head & Shoulders neckline at 47.00.

Crude oil futures tumbles this morning in a mid-Cycle correction.  Support may be found near 90.00, but crude may go lower.   Strength may return in the latter half of September.

Gold may be putting in its Master Cycle low this morning as it tests the 52-day Moving Average at 4254.06.  There is a possibility of an extension into next week, so the position is neutral.

The Ag Index is probing last Thursday’s Master Cycle low, with the result yet uncertain.  Should the low hold, a reversal may be imminent.  There would be a cleaner signal if GKX touched the tneckline.  However, an aggressive buy signal may be in play if it goes higher.

Bitcoin slipped beneath its previous low at 76300.00 this morning, then raced toward the trendline near 80000.00.  This move may confirm the sell signal that may last to late October.  The Cycle Bottom at 56793.00 may be the current 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.

10:54 am

NDX declined beneath the 52-day Moving Average at 29240.00, but appears to have reversed course.  A buy signal may be given once the NDX breaks above it.  The  setup for a tech panic rally may have arrived, as AI call buyers have returned.

8:30 am

Good Morning!

SPX futures declined to 7619.60 thus far this morning,   Traders are increasingly listless and cautious, because of concerns about AI, the economy (interest rates) and war.  The SPX may sink as far as the 52-day Moving Average at 7564.14, which is commonly viewed by traders as a line in the sand…and still reverse higher in the next two days.  The reason is in the Cycles.  The pattern even had me fooled as I had expected a Master Cycle high this week.  Instead we see a low precisely at the terminus of the old Cycle.

ZeroHedge reports, “US stock futures slumped for a 3rd consecutive day, unable to find traction, and trading at session lows with tech underperforming as Treasury yields pushed higher keeping risk appetite firmly in check ahead of the latest print on US factory prices and earnings from Oracle.”

The premarket VIX rose to 17.76 this morning, and may go higher as the SPX tests the 52-day Moving Average.  This move has been overdue as VIX remains low in absolute terms.  The target of this move may be either the mid-Cycle resistance at 18.23 or the upper trading channel trendline at 19.00.  That may relieve the oversold condition.  The irony is that today also marks the end of the current Master Cycle.

The US 10-year Bond Yield futures rose to 49.28 this morning, while the cash market rose to 49.22.  The breakout has grown stronger, but may be nearing its Master cycle terminus.

RealInvestmentAdvice presents the arguments, “Heading into the September 16 FOMC meeting, the debate over whether the Fed should raise rates or hold is heated. To help you appreciate the range of views, we present this article as a courtroom exercise. We will let the prosecution make its case for a rate hike, and the defense make its case for a hold. We will render our verdict after both sides present their cases.”

ZeroHedge notes a close call,”After today’s very disappointing buyback announcement, which at $6BN came in far below whisper expectations of $10BN, and which sent yields surging to 4.85%, many were on edge ahead of today’s $39 billion sale of 10Y paper. In the end, it priced far stronger than expected, with today’s selloff providing a sufficient concession to stir up enough demand to avoid a fullblown bond market panic. ”

The USD Index reversed course this morning after making a minor swing low.  A rise above the mid-Cycle resistance at 99.19may offer a buy signal.  The USD may turn from net short to net long in the next week, causing pain for the dollar shorts.

Crude oil rose to a morning high at 100.88, continuing its rally toward the Cycle Top at 111.32.  The Cycles Model allows the uptrend to continue to mid-October, giving WTI the ability to meet (and exceed) its target.

ZeroHedge notes, “Brent crude futures traded above $102 a barrel Thursday morning after Iran threatened to intensify attacks, renewing concerns over tanker flows through the Hormuz maritime chokepoint.”

Gold dropped through Intermediate support at 4346.02 as it prepares to test the 52-day Moving average at 4248.25.  This occurrence may happen by the weekend, as the terminus of the current Master Cycle is imminent.  The subsequent bounce may last up to a month, but may be limited by the mid-Cycle resistance at 4554.88.

The Agricultural Index may be pulling a fast one in the Cycles .  The Master Cycle was due on September 3, as illustrated in the chart, just one day after its high at 450.39.  I had earlier expressed a concern that the index may decline beneath the Head & Shoulders neckline at 425.00.  However, it seems to be falling short…and causing a dilemma.  A Cycle low above the trendline may immediately call for a continued rally to the Head & Shoulders target.  While some items are disappearing from store shelves, overall crop inventories remain “comfortable” for now.

Bitcoin has resumed its decline with gusto, testing its September 2 low at 76300.00.  An aggressive sell signal may be obtained beneath that level.   Confirmation of the sell signal may be sought bneath Intermediate support, currently at 73402.00.  The Cycles Model suggests the decline may continue to the 4th week of October, giving bitcoin the ability to decline to the Cycle Bottom at 56793.00.

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.

8:00 am

Good Morning!

This morning’s SPX futures declined to 7643.60 thus far, raising the caution level.  While the  Intermediate support for the SPX may be valid, the trendline may not.  True support lies at 7611.00.  Should the SPX venture beneath it, a larger decline may ensue.  However, the fractal may yet be incomplete, allowing another probe higher to the Cycle Top at 7916.71, or higher.  Should that level hold, SPX may imminently receive a burst of energy that may send it higher.  This market isn’t giving away any of its secrets, making it a difficult one to follow.

The premarket VIX rose to 16.55, short of a breakout at 16.82.  VIX may also be short of completion, with  another potential decline ahead.

The US 10-year Bond Yield is also edging higher, to 48.14 thus far.  It may be due for a reversal imminently.  Let’s see what Bessent and Warsh may have up their sleeve.

I have a busy day of appointments ahead.  I may attempt to come back to the blog later this afternoon.

The Yen Broke above its Cycle Top resistance at 65.04 and appears to have stopped for the time being.  Should the Yen pull back, it may have left a Head & Shoulders formation projecting further gains.  Thus far the Yen has appreciated over 7% from its July low.  It is likely that there is at least one hedge fund in the Yen Carry trade that may be taken out on a stretcher.  This move has some far-reaching effects on world liquidity, including our own.  The Yen carry is  basically a short on the Yen.

ZeroHedge observes, “US Treasury Secretary went full judge, jury, and executioner on speculative yen shorts overnight with probably the most direct explicit jawboning we have seen in years…”

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.

10:41 am

BKX is testing its 52-day Moving Average at 187.90 this morning after making a possible Master Cycle high on Friday.  A decline beneath the 52-day may produce an aggressive sell signal.  Confirmation of that signal may lie beneath the trendline at 186.00.  Liquidity may be getting thin with knock-on results showing in the BKX and in Bitcoin.  Weakness has made an appearance today and may double down by the weekend.  The new master Cycle may show up as a decline to the end of October.

8:15 am

Good Morning!

SPX futures went lower this morning, toward Intermediate support and the trendline at 7635.77.  The  bull market trend remains intact, but it is coming under pressure.  While inflation risks are continuing to build, the Cycles Model suggests the SPX may go higher.  The indicated target for the current rally may be the Cycle Top resistance at 7910.02 in the next week.  however, should the Master Cycle extend, a potential target may be 8000.00 or higher.

ZeroHedge reports, “US futures fell as Brent crude approached $100 a barrel, chasing Shanghai crude which is now trading above $102, reinforcing expectations that central banks will have to raise interest rates to contain inflation while a key CPI print looms on Friday.”

The  premarket VIX rose above the Triangle trendline at 15.00, topping out at 15.94.  Should it remain beneath the 53-day Moving Average at 16.30, it may resume its decline beneath the trading channel near 14.00.  The Cycles Model suggests that the VIX may be nearing its Master Cycle terminus, but an extension is not out of the question.

The US 10-year Bond Yield has dropped beneath the Cycle Top support at 48.03 this mornig, taking pressure off Treasuries temporarily.  The Cycles Model suggess a possible week of sideways-to-lower yields.  The likelihood of a test of the Head & Shoulders neckline at 47.00 may be operative.

ZeroHedge remarks, “The latest global bond sell-off has revived the idea that markets are fretting over unsustainable public finances. As concerned as I am by this issue in the longer term, the recent bond market weakness at the moment should be seen more as a continuation of the long normalisation from the historic anomaly of the 2010s.”

The US Dollar Index may be testing its August 20 low.  The Cycles Model does not anticipate a new low.  However, the USD may show weakness over the nxt week or possibly longer.   While the dollar debasement theme is still commonly held, the US dollar remains the strongest currency internationally.    A bounce above the mid-Cycle support/resistance line at 99.18 may introduce a buy signal.

Crude oil broke out above its July high at 93.50 this morning, then pulled back.  There may be a retest of the declining trendline near 84.50 before a resumption of the uptrend.   What follows may be a resumption of a very strong probe toward the cycle Top resistance at 111.96.

ZeroHedge observes, “Geopolitical risks in the Gulf pushed Brent crude futures toward $100 a barrel overnight as Yemen’s Iranian-backed Houthi rebels launched new attacks on Saudi cities and economic infrastructure.”

Gold was repulsed at the mid-Cycle resistance at 4554.09 ovwer the weekend and may be resuming its downtrend.  The current target may be the 52-day Moving Average at 4236.50.  However, it may go lower.  The Cycles Model suggests gold may be winding up its Master Cycle shortly.

Bitcoin has declined beneath its long-held trendline near 80000.00 and given a possible sell signal.  A further decline beneath 76000.00 may confirm the sell.  The Cycles Model suggests a possible panic decline should it break through that low.  The new Master Cycle may extend to late October.

The Agricultural Index continues to consolidate above its Head & Shoulders neckline at 420.00.    The Cycles Model infers a possible retest of the neckline before moving higher.  Note that Trending Strength may return this weekend and may extend up to two more weeks.