The red channel that we were watching yesterday held.  From yesterday’s members’ section:

Note that the nearly horizontal red channel could provide for a quick reversal at present price levels – particularly if CL doesn’t hold at the .618 at 51.72.

CL didn’t hold at 51.72.  In fact it plunged to 50.8 — before a “mysterious” V-shaped  bounce into the close provided the help SPX needed in order to close in the green.

USDJPY got an assist, popping back above the top of the pennant pattern (in red, below) it had more than backtested.  But, it’s hard to ignore the glaring divergence between USDJPY and ES between Feb 11-16.

We’ve placed a downside target at the purple .886 at 2080.71.  But, as we discussed yesterday, it’s not the only target we’ve got our eyes on.

continued for members…

It depends largely on whether TPTB plan on running up to 2138 anytime soon.  In previous episodes of large scale Fib numbers being approached, there was a lot of hemming and hawing first.  And, the actual storming of the castle walls occurred over a holiday weekend when no one was watching.

SPX has gained 120 points (6.1%) in the last two weeks.  But, it suddenly runs out of steam only 37 points shy of a key Fib level?  I suspect yesterday was all about bagging the round number 2100.

So, I won’t be surprised if we see 2080, or the red channel .786 line (about 2076) or even the SMA10 (2068) before the next leg up unfolds.

As always, keep an eye on CL and USDJPY — which are great early warning signs of an incipient ramp job.