With the narrative so egregiously inconsistent with reality, even central bankers are having a hard time maintaining a straight face while propping up oil.  And, the credibility ship sailed a long time ago for these guys.

With CL going sideways overnight (the equivalent of a disaster in any other security), it’s back to propping up stocks with a good old fashioned USDJPY ramp.  It was good for 12 points on the eminis overnight.

continued for members…

UPDATE:  9:34 AM

I’d try a short position here, but be aware that USDJPY could just as easily break out as break down from the red TL connecting last week’s highs. CL is likewise positioned for a breakout if they so choose.UPDATE:  9:44 AM

Another look at USDJPY, which, if it breaks out could easily be heading for 109.65… …and, some random thoughts on SPX…Keep in mind that existing home sales will be released at 10AM.  Last month’s number was a big miss.   Of course, it led to only a 7-pt drop in SPX before that day’s stick save.

UPDATE:  9:53 AM

Not crazy about how this is shaping up.  ES and SPX are creeping higher even without any help.  Be ready to pull the plug if the homes data is positive and SPX spikes at all.UPDATE:  10:05 AM

Sales were a beat, with both strong volume and price.  This obviously doesn’t help the “ZIRP forever” narrative and puts a serious dent in forecasts of NIRP.

SPX seems unfazed, and USDJPY and CL haven’t really reacted.  Holding short, with an initial target of the rising SMA5 200, now at 2091.62.  It should be back above yesterday’s lows of 2091.68 shortly.UPDATE:  11:08 AM

Wanted to believe it would run out of steam, but SPX is nudging up against our entry point on more ludicrous CL ramping that, again, reached last March’s highs.  Back to cash here.If it backs off, I’d take another crack at it.  But, CL looks like it’s intent on at least a deep retrace of yesterday’s highs.

Really thought ES would manage a backtest of the broken white channel…UPDATE:  12:54 PM

Shorting here on the premise that CL and USDJPY are both done for the day.  CL has backtested the top of the rising purple channel as well as the belly of the rising white channel — both of which have been broken. USDJPY has reached our upside target and plenty of resistance.I think DX has gone as high as it can.Meaning SPX should reverse between here and 2107.42 — essentially at the top of the rising white channel.UPDATE:  2:21 PM

SPX on the verge of another little CL-fueled breakout.  Apparently 6.7% on the day wasn’t enough.  I’d step aside and revert to cash.UPDATE:  3:19 PM

Back inside the white channel after being very overbought.  But, there’s good potential support at the red channel bottom (2107.42.)  I’d short here, but be prepared to close it if it reverses there.If it bounces there, should be a good opportunity to pick up a few points on the upside.  Note that previous reversals off the white channel top have been good for 25+ points.  But, no one should be surprised if it broke out.UPDATE:  3:45 PM

That’s about it for the easy money on this dip.  There’s much more potential downside, but those who can’t hedge or watch overnight should take profits.  Today’s CL spike is a great reminder that prices can be directed at will. UPDATE:  3:53 PM

USDJPY is selling off, could take SPX down with it.