SPX reached our upside target quickly enough, but the reversal held off until the last hour of the day.
Part of the problem, of course, was the CL/RB ramp. The other was USDJPY, which popped through the previous high as expected.
It won’t be enough, though, as the SMA200s are finally close enough to let volatility go where it wants. The only questions are when and whether the SMA200s will hold. ES’ SMA200 is only gaining about 1-pt per day, so there’s little value in delaying it any further.
The nice thing about the all-clear is that oil and gas should finally be free to make their moves. Without quarter-end equity numbers to protect, we should get some good action.
continued for members…
VIX should break the red TL and head for the red .786 at 22.55, the red .886 at 24.03, or the previous high around 25.
DJI continued its streak on Friday — 5 closes below the SMA200. Today should be number 6. DJI bounced off its SMA200 on Apr 2 and May 3. Before that, the last time it even tagged it was on Jun 28, 2016.
The last time it closed below it six times in a row was in the midst of the Jan-Feb 2016 meltdown. It dropped through the SMA200 at 17,533 on Dec 31, 2015 and didn’t bottom out until 15,450 on Jan 20 — an 11.9% plunge.
There’s certainly been a lot of speculation about the politics surrounding the price of oil and gas, but hardly any talk about the economics.
We had more chatter out of the White House over the weekend. First came a tweet from Trump that he had obtained a commiment from the Saudis to produce 2mm more barrels of oil per day. This was quickly retracted, and restated as the Saudis having 2mm barrels of extra capacity — a big difference.
In any case, Trump is panicking. The EIA can lie all they want about gas prices, allowing the BLS to lie about CPI. But, at the end of the day, Americans have to pay actual prices. So, June CPI might end up near May’s 2.8%, but budgets are being strained. Spending is being reduced elsewhere. Despite claims to the contrary, those July 4th road trips are being curtailed.
UPDATE: 10:50 AM
A good start, assuming RB can drop through its SMA10. Note that the SMA200 is now up to the red .618 at 1.889. I’ve added a second target at about 1.9365, however, to reflect the possibility that TPTB deem a backtest of the purple channel top too important to pass up. 
Note that ES is back to a 4.75-pt loss after a timely VIX collapse. 
The last time VIX broke the yellow TL, ES got a very nice bounce. This is an important line in the sand for VIX. I suspect that this is a delaying tactic and it will hold. If it doesn’t, I suspect the SMA5-200 will.