The VIX nonsense continues, ramping futures back above the SMA100 with the help of Jim Bullard, Fed president and occasional CNBC host, who insists there is no recession – just like he insisted inflation wouldn’t be a problem.

Whether there is or not, the market will never reflect one as long as this kind of nonsense goes on.

continued for members…

The next CPI report doesn’t come out until the 10th. Hopefully this won’t go on until then…

Note that I have switched VIX’s chart to arithmetic instead of log. It fits the lows and some of the highs better. It still shows a current logjam of candles at the bottom of the channel, which is something we haven’t seen for a while. Diagnosis: a stall.ES and SPX now show the upside target of the white channel top at a backtest of the SMA200 right around CPI and OPEX on 8/10 and 8/19 respectively.

The BoJ is on board, with a sharp rebound in USDJPY……enabling EURUSD’s decline… …which has enabled a rebound in DXY. As expected GC and SI have retreated from their SMA50s. And, BTC has extended its flag pattern by bouncing on its SMA200 despite yet another significant hack hitting the wires.

Oil and gas both popped out of their falling channels overnight before returning to the downtrend. If there’s any chart that speaks to the market’s downside potential, it’s COMP. Remember, it completed a H&S targeting 8860 back in April.  Just today, it backtested that pattern’s neckline…

…in addition to the midline of the huge red channel dating back to 2000.  The purple channel bottom was tested on Jun 16, but we’ve seen it broken before (Mar 2020.)

If it should break down again, the white 1.618 and purple .886 are within a few points of each other and intersect with the red channel’s .236 line in early 2023.