USDJPY continues to struggle, giving up the .382 Fib overnight.  The next potential support is the SMA50 at 106.06 and the combination of Fibs at 105.5.

The more troubling development for Mr. Market is the bond market.  The 10-yr note futures shot through the previous high overnight, complicating the prospects of a quick resolution to the market’s correction.

While ES successfully backtested its SMA200 yesterday, SPX didn’t quite make it — fading in the afternoon as has been its habit of late.

There are a number of potential downside targets from a Fib and chart pattern standpoint.  The keys remain the unraveling yen carry trade and interest rates.  I’d keep a close eye on each — particularly when the plunges take place during market hours in less controllable circumstances.

Note that while we might see a reversal today on the white Fibonacci grid — the .786, .886 or the 1.272 itself — we still have to deal with the grey grid, which suggests the possibility of a drop to the .786 at 1798 or the .886 at 1770.

I will be out of the office for the rest of the day, but will check in from time to time.  GLTA.