Powell’s press conference was everything a bull could want: unlimited support for an unlimited time, propping up everything the law might allow – and maybe more. But, we already knew that. As I asked yesterday morning, how do you improve upon “whatever it takes?”
The market rallied anyway, spiking past an important Fib level on more Remdesivir hopium and a fair amount of short covering. This morning, we find that the economy is doing even worse than expected…
…millions of people are still being laid off with the latest tally topping 30 million…
…and thousands of people are still dying of COVID-19 every day. 
And, the trillions that central banks are throwing at the markets won’t change any of the above.
Futures have given up the 61.8% Fib support and are headed south.
continued for members…
Having given up the purple channel, ES is now trying to hold the white channel midline and SMA10. There’s also an internal TL dating back to Apr 9.
The SPX version:
A reminder of the big picture:
Perhaps the most interesting equity chart this morning is the Dow – which has backtested its purple channel midline. A failure here would open up the 2.24 again and, should it fall, would open up the Mar lows.
VIX is getting a nice bounce.
CL reached our 17.12 target, a better place to short IMO. 
I’ve repositioned the latest rising channel.
Exposure is still the white channel bottom at 20.60ish.
RB is threatening a breakout. I would keep a close eye on it, particularly with the inflation picture being so dreadful.
USDJPY got a nice bounce intraday yesterday, and is likely to retest the red TL from Apr 23.
Combined with EURUSD’s continuing stall…
…it should provide the bounce we’ve been expecting for DXY.
Which could well put additional pressure on GC. It’s hanging in there atop the 1710 IH&S target and 2.618 purple Fib, but a 2% pop in DXY might result in a dip to the .707 or lower.
The bond market is pretty quiet this morning, but the 10Y is getting a bit of a boost as rates are settling a bit lower.
I have a slew of meetings today starting at 10AM.
More later...
UPDATE: 3:43 PM
Pretty good start to a selloff. VIX has formed a flag pattern – normally a continuation. But, it also reached good support yesterday, so there’s a decent chance it’ll keep bouncing.
The most surprising move is the breakdown of the dollar on the back of USDJPY’s and EURUSD’s rallies. It’s not that the dollar shouldn’t be crashing given the Fed’s actions. It’s just that Japan and the EU are also throwing everything they’ve got at the crisis.
CL and RB are doing what they can, but are struggling.
ES is backtesting the red TL, after which it should crater. Assuming it makes it through the SMA10, our target is 2703ish – SPX’s 2.24 extension. Though, as before, ES’ 2.24 at 2728 is still support.
SPX has less of a clear cut target. Reaching the SMA10 could require a dip below the channel midline, which supports the idea of a stall if we are to reach 2703 by May 7-8. It’s only after 2703 falls and the yellow channel breaks down that we can get excited about those juicy targets such as 2483, 2138, 1990 and 1823.
More later.
UPDATE: 10:10 PM
So far, so good.
