Charts I’m Watching: May 15, 2014

Looks like ES and SPX are intending to tag their SMA10’s (1879.05 and 1883.22) before anything else happens.  If they break support there, the 20s are at 18751878 and the 50s at 1862/1868.  Keep an eye on the 10-yr this morning, as there’s a lot of short covering and some pretty wild swings going on.

2014-05-15-ZN 5 0553

USDJPY is likewise all over the map, with a tag last night of the .786 we were watching, and now a .786 or .886 retrace of the midnight reversal (probably whatever it takes to tag the SMA10s.)  If it’s a sharp reversal off the MAs, our upside targets should be in play.  Keep an eye on the 10-yr.

2014-05-15-USDJPY 5 0622

UPDATE: 11:20 AM

ES just tagged the SMA50, TNX tested its Oct 2013 lows, USDJPY tested its Apr 10 lows.  Bulls should take a stand here, but keep an eye on the 10-yr and USDJPY (Feb lows 100.746.)

2014-05-15-tnx 4hr 0822 2014-05-15-USDJPY 4hr 0822

UPDATE:  3:15 PM

TNX and ZN have been great signals today.  But, keep an eye on USDJPY as well.  The SMA200 is down at 101.19.  If the pair takes a run at it during market hours, we have another leg down.  A bounce off it in the after-hours means a big rally tomorrow.  Keep in mind that TNX didn’t quite reach 24.71 — but, only 24.73.  Just saying…

Meanwhile, SPX and ES have set up little IH&S with targets of 1876.50 and 1874.50 — just in case we get the usual last minute USDJPY ramp/VIX crush.   Remember, ES SMA20 at 1873.94 and SPX SMA20 at 1878.35.

UPDATE:  EOD

ES and SPX got stuck at their IH&S necklines at the close, wondering whether ZN can remain above the .618 at 125’225 (TNX closed at 2.52) and USDJPY can remain below the days high of 101.595.  If so, the implicatino is more downside tomorrow.

USDJPY is anyone’s guess, as that SMA200 at 101.21 is hard to ignore.  But, the close felt “constrained”, as if to drive home the point that there would be no more upside for stocks.  Sometimes, MM’s engineer a close like this in order to flush out those tempted to hold long overnight.  They want it all to themselves.

2014-05-15-USDJPY 5 min

Likewise, the 10-yr futures are loitering up above the .618 (125’225) — an obvious spot for at least a backtest – especially rates back above 2.50 at the close.  The same thing happened yesterday, and prices fell back below the .618 before the daily print.  Not saying it’ll happen again, and I wouldn’t hold overnight either way.

2014-05-15-ZN daily 1400

But, ES got a good bounce off the SMA50 and the daily cloud.  I wouldn’t be at all surprised if we got a snap back rally either overnight or tomorrow — OPEX.

2014-05-15-5 ES 1425

GLTA.

 

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