Charts I’m Watching: May 23, 2014

Remember, no POMO today.  Our thesis about NKD was weakened as it popped a bit overnight.  There is still overhead resistance and a rising wedge, but not as compelling since it exceeded the 5/13 high.

2014-05-23 NKD v ES 0600

Likewise, USDJPY was ramped a bit after the close yesterday, fell during Tokyo trading, and was ramped again after their market closed — testing the SMA20.

2014-05-23 USDJPY 30 min 0615

The near-term bounce should continue, but there remains the issue of the broken grey channel bottom and all those bearishly-aligned moving averages…

2014-05-23 USDJPY daily SMAs 0615

…not to mention decent channel resistance.

2014-05-23 USDJPY daily 0615

The e-minis have gone essentially nowhere after selling off at the close.

2014-05-23-ES 15 0557

While ES tagged its .886 yesterday, SPX never reached its.  So, we could see another cycle up powered by USDJPY.  The only problem is e-mini buyers are reluctant to bid up over 1894.  By my calculations, getting SPX to 1897.63 will require ES reaching roughly 1895. Who’s going to bite the bullet?

It’ll take a big spike in USDJPY — pushing through the SMA20 at 101.92? — which normally would have occurred at 15-30 minutes prior to the close yesterday.  HP’s goof seems to have put a damper on the normal algo action.  Now…they’re a bit confused.

Back in the old days, before the word “market” required quotation marks, this wouldn’t be an issue.  Investors would look at things like earnings, the economy, geo-political events, etc and decide whether they justified higher prices.

I suspect it’ll happen, and what better time than a holiday weekend?   Low volume and minimal attention from real investors can work wonders — especially when the land of milk and honey lies just beyond 1900.



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