SPX futures remain flat after testing the 5875.00 support level overnight. While there may be a surge in retail buying, the efficacy of the short covering to the rally may have disappeared. The actions thus far have not produced any anxiety, but the saying goes, “The bull market rises on an escalator, but descends in the elevator.” The Cycle Model offers approximately two weeks of decline, which doesn’t seem to phase people after six weeks of rally. However, Ending Diagonals are often completely retraced in the decline that follows.

Today’s options chain shows Max Pain at 5950.00. Long gamma may begin above 5975.00 while short gamma resides beneath 5925.00. There is a large put wall at 5900.00 that may accelerate the decline.

VIX futures rose to 20.33 this morning, signaling a potential buy signal above mid-Cycle resistance at 19.94. The 50-day Moving Average lies at 25.14, where most analysts may declare a buy signal. VIX has been hovering near its trendline for nearly a month and is due for a lift-off. The Cycles Model suggests trending strength may appear over the next two weeks.

Bitcoin is on a sell signal which may be further confirmed as it declines beneath Intermediate support at 102592.27. Bitcoin may also be on a mandate to completely retrace its rally from April 7. When one examines the track rtecord of Bitcoin and other cryptocurrencies, one may conclude that Crypto will not take the place of a sovereign currency because it has the behavioral properties of a simple trading platform with no intrinsic value. China is against bitcoin because it offers a way to move assets out of the mainland and is used for money laundering.

ZeroHedge observes, ” Vice President JD Vance said that China’s aversion to decentralized cryptocurrencies like Bitcoin was one more reason that the United States should embrace the technology.

“The People’s Republic of China doesn’t like Bitcoin. Well, we should be asking ourselves, why is that? Why is our biggest adversary such an opponent of Bitcoin, and if the communist Republic of China is leaning away from Bitcoin, then maybe the United States ought to be leaning into Bitcoin, and that’s one of the things we’re going to be doing,” he said.”

USD futures have been trading rather flat in the overnight session after attempting to make a double bottom. It may still attempt to decline to the Cycle Bottom at 98.03 to end its Master Cycle, which has another week to go. Conversely, we may see an early bottom as strength is due to make a comeback next week, according to the Master Cycle.

More By This Author: