Charts I’m Watching: May 6, 2015

SPX nailed our initial downside target yesterday (in yellow below) before USDJPY and CL bounced just enough to stave off any further drops. In all, it was a 33-pt reversal that the pundits laid at the feet of the trade deficit report — which certainly got the few remaining fundamental investors off the mark.2015-05-06 SPX 60 0601The algos and technical types were no doubt unnerved by USDJPY once again giving up the major .618 Fib line at 120.11…

2015-05-06 USDJPY 0601 …and the unwillingness of CL to come to the rescue.

2015-05-06 CL v DX 60 0601But, as we anticipated, CL is under pressure from a dollar that needs to rebound for technical purposes — despite the fact that it is, itself, under pressure from the fundamentalists who noted its responsibility for the crappy trade numbers.

Overnight, CL ramped substantially (yes, again) which has the eminis up 6.50 just before the opening bell.  But, it has also run into important resistance at 62.12 with an even more important, larger scale .618 Fib just above at 64.38.  When CL runs out of steam here, how will this affect equity prices — especially with SPX this close to our 2138 target?

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