Equities are still in a very precarious position.  The usual pre-open ramp job flopped and the red channel integrity is beginning to look strained.  Still, with seven stick saves now at 1820-1823, we have to wonder if it’ll be allowed to get started on the next wave down.

Depending on which falling channel it’s following, USDJPY has either run out of steam or is positioning itself for a run back to 105.27.  I wouldn’t chase it, as the red .886 should hold — at least for now.

UPDATE:  10:00 AM

ISM’s services survey is out this morning.  Note the contraction in new orders, inventories, and order backlogs.  The only category which is growing faster is employment.  Oops.

Speaking of “oops,” check out the move in gold between 10:12 and 10:14 this morning.  Fat finger, or simply a loss of well-defined support?  Trading was halted, and we’ve all been advised to move along… nothing to see, here.

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USDJPY led the way yesterday as expected.  The channel dating back to Nov 7 looks to be breaking down — or at least tilting.

The task now for equities will be to maintain downward momentum in the face of all the FOMC cheerleaders out on the talk circuit and auto sales data puffery.

So far, the emini’s ramp job looks like a back-test of the broken red channel, but we’ll have to wait and see.

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As we discussed Tuesday, the USDJPY is the key indicator to watch. And, it’s off to a good start…

UPDATE:  10:05 AM

Look for the slide to continue, targeting the gap close at 104.33?  But, that’s just the purple .618.  The purple .786 or .886 take the pair all the way to the channel bottom and make for a more interesting first day at a decline of 1.31-1.46.

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