ES is up 1.3% in the past week. All it took was a 15% beatdown in VIX.

continued for members…

The cash index shows a potential breakdown of the long-term trend line from Jan 2018.

This puts ES above the neckline of an IH&S that suggests new all-time highs. Of course, this is preposterous. But, unless ES dives back below 4186, it’s happening all the same.

Note that SPX has already completed a 88.6% retrace (a bat pattern) from Feb highs.Not much happening in currencies…

…as oil/gas roll over…

…and the 10Y pushes higher despite weaker than expected housing starts.I am truly surprised to see the market manipulated to new highs with VIX. This sort of effort is usually undertaken in order to protect the market from serious downturns or declines below important support. The channel breakout has already occurred, and I haven’t heard anyone – even the most rabid bulls – suggest that the economic/earnings picture justifies new all-time highs as are suggested by the IH&S patterns.

Bottom line, if the VIX breakdown holds, then equities are safe for the time being. Stay tuned.