Market Analysis - Tuesday, June 16

SPX futures consolidated in a 22-point range around yesterday’s close. Domestic sentiment is bearish across the board, so who is doing the buying? A look at the drawdowns in various currencies show some possibilities. While the June drawdown in USD was -5.15%, the drawdown in Swiss Francs was only -4.3%. The Swiss are bankers for many Middle Eastern countries. The drawdown in Japanese Yen was -4.8%. That tells us that investors tn those currencies had less to lose and possibly more to gain investing in the US. The fact that the majority of yesterday’s gain was made overnight lends credence to that observation, as their markets precede ours.

Today’s options chain shows Max Pain at 7560.00. Long gamma is close by at 7570.00 while short gamma strengthens beneath 7535.00.

ZeroHedge reports, “US futures are flat, pausing after a three-day rally with investors shifting their focus to this week’s FOMC meeting, Kevin Warsh’s first, which begins today.”

The premarket VIX is in consolidation after yesterday’s decline. The Cycles Model infers a further decline beneath the lower Triangle boundary. It may catch many investors wrong-sided when the reversal occurs.

The June 17 options chain shows Max Pain at 19.50. Short gamma resided from 15.00 to 19.00. Long gamma may begin above 20.00 and is well populated to 140.00.