Futures are off this morning on disappointing earnings/guidance from market leaders (AMZN, AAPL and SBUX) and a significant miss on Personal Income (-1.0% vs -0.3% consensus.)  Meanwhile, the PCE deflator rose to a new 30-year high at 4.4% YoY (core: 3.6%.) More fuel for the stagflation fires…

continued for members…ES and SPX came very close to new highs yesterday before pulling back. VIX even popped up above the red TL below which it broke down a week ago. The key for equities’ downside case is now whether it can top its SMA20, SMA100 and SMA200 and break out of the falling white channel.Elsewhere, CL continues its minor slump, testing its SMA20 again. It hasn’t closed below it since August 25.And RB is sneaking up on a bearish 10/20 cross. Meanwhile, USDJPY continues to hang just below its last overhead resistance. It is due a backtest of its SMA200 but that will apparently depend on whether equities need additional support.EURUSD has backed off just enough… …to prevent DXY from breaking down.Gold and silver are having a rough morning, with GC dropping back through its SMA200 and SMA100……and SI backing off its extended backtest. Both have put together very strange charts, with what I suspect is a great deal of manipulation. The Fed, which is still pedaling the “inflation is under control” idea, will always have it in for gold.

So, despite the fact that it should be making new highs in this inflationary environment, I expect it to continue to be under pressure. Same with SI, though I wouldn’t be surprised if it continued its backtest to tag the SMA200.I’ll leave it here and head back to wrap up Wednesday’s big picture post.

I want to thank everyone for their patience these past couple of weeks while I cope with a really painful lower back episode. I’ve had back problems for 30 years. It’s not usually an issue as long as I exercise and don’t do anything stupid. When it flares up, it can be hard to sleep and I’m not at my best the next day – especially after our move back to the West Coast (the market opens at 6:30 instead of 9:30am.)

The solution is getting cortisone injections into my spine – which is every bit as much fun as it sounds. It’s taking time to get in to see a specialist in our new location. But, hopefully in the next couple of weeks I can get back to normal.

UPDATE:  3:49 PM

Guess this shouldn’t come as a surprise – a steady drop in VIX, followed by a breakdown! below the newly constructed channel. Not so coincidentally, ES goes to new highs (on the day when the biggest, most important stocks in the universe are suffering big losses.)