pebblewriter

Month: February 2026

  • Retail Sales Tumble

    U.S. retail sales were unexpectedly flat in December, confirming that the overall economy is on a slower growth path than most economists had believed. November’s print was a strong 0.6% increase. Futures are flat as the jobs and inflation data also due out this week are viewed as more important.
    Note that RSI for both SPX and ES has been making lower highs, diverging from the higher highs in the indices themselves.
    DJIA has officially tagged its 1.1618 Fibonacci extension.
    VX remains below the TL and SMA200, propping up stocks for now.
    Our model continues to suggest a significant drop is imminent.

  • Charts I’m Watching: Feb 9, 2026

    Futures are off moderately ahead of delayed economic data due out later this week. Friday’s knee-jerk rally took SPX to 7,000, so a pullback back below the SMA50 would be significant.

    Note that a pullback to the SMA200 will soon be able to occur without producing a lower low.

    As we noted last week, the bulls need VX back below that TL and its SMA200. It remains on the bubble this morning.

    Another measure on the bubble: DXY.

    With EURUSD reaching out 1.20 target and interest rates still rising, it has an important decision to make.

    In Japan, the Liberal Democratic Party won by huge margins – a mandate for Takaichi and her expansionary fiscal policy agenda and large investments in “national champions.” The resulting rise in interest rates has halted the USDJPY’s recent rally, at least for now.

    In the US, the divergence between the DXY and the 10Y continues.

    Tech, software and the effects of AI on the Mag 7 continue to present significant risks to the market.

     

    Stay tuned…

  • Battle Ahead

    There’s a battle shaping up at ES 6580, where the 200-day moving average is about to catch up to horizontal support at the previous lows. If it doesn’t hold, the next major support is another 210 points lower.

    Much will depend on whether or not AMZN can hold 200. If not, the next highest levels of support are way down at 175 and 147.

    As always, VX deserves close scrutiny. Its recent breakout above the trendline from last April and its SMA200 is highly significant. Bulls need it to fail.

    Note that in a V-shaped recovery, the DJIA has to contend with our target at the 1.618 Fib extension at 50,303.