A Long Time Coming

A month ago [see: Crossroads Ahead ] we targeted the 1.618 at 2335 as an attractive target for a pullback.  The only hitch was that SPX then broke out of the rising white channel it was in, making the backtest a little tricky.  

In this case, patience paid off, as SPX is positioned to backtest the (repositioned) channel and the 1.618 in one fell swoop this morning.

The decline has been forced on an otherwise exuberant (thanks to the algos) market by oil’s timely decline and a (coming) plunge in USDJPY.  Will the backtest hold, or is something nastier in store?

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