Stocks are on track, progressing nicely toward our downside targets.  Keep an eye on VIX this morning, as it’s threatening a breakout.The yield curve continues to flash a warning sign as per our model [see: Yield Curve, a Closer Look.]

continued for members…

TNX has yet to break down……which continues to prop up DXY.CL is also holding on to its bounce.

Remember, SPX and ES are out of sync at present.  We have two basic downside targets: ES’ 2.24 extension at 2728.79…… and SPX’s at 2703.62.Also remember that the declines we’ve seen so far have tended to come ahead of plan (our analog.) So, it’s entirely possible that we get there today rather than tomorrow.  Since ES’s 2.24 comes first, that’ll be the first test.

ES 2728.79 would be approximately SPX 2723.80.  And, SPX 2703.62 would be about ES 2707.44.  That works out to be very close to a .618 Fib for ES at 2708.22.

UPDATE:  10:55 AM

ES just tagged its 2.24 at 2728.79.  Waiting to see if there’s any follow through.  So far, it looks like it’ll seep lower.I put the bottom of the channel at around 2718.40.

UPDATE:  11:48 AM

Closing in on SPX 2.24 and ES .618 (currently at channel bottom…so, close.) VIX is backtesting the white channel bottom.  Good potential turning point between 19.30 and 20.70.UPDATE:  12:55 PM

ES just tagged its .618 as SPX came within 1 pt of its 2.24 and VIX tagged its .707. If 2703.62 should fail, then the white channel bottom is very close to the .382 at 2662.64.

UPDATE:  1:07 PM

Making it official…