ORIGINAL POST:  9:00 AM

EURUSD running out of steam… Would love to short around 1.2971.

DX finding support for continued push higher…stands a very good chance of breaking out of the channel today or tomorrow…  I’m an aggressive buyer at 79.33.

e-minis hitting resistance…

Fading this rally unless we break out of the triangle… currently ranges from 1454-1464 with apex of 1459 on Friday.  Decent chance we’ll tag the upper bound at 1463-1464 before reversing…

More after the open.

UPDATE:  10:20 AM

Ideal spot for reversal: the .786 and white channel bound at 1463.86.

UPDATE:  10:40 AM

EURUSD in the final throws — looking for a butterfly completion at the top of the channel in a rising wedge. Should get a reversal between now and 1:00 PM EDT, ideally at 1.2970.  Immediate potential to the bottom of the channel — currently around 1.28.

The dollar is similarly working towards a Crab Pattern completion at the lower bound of its channel — while in a falling wedge.  Idealized reversal would be at 79.334 between 12-2 PM EDT.   Immediate potential to the top of the two channels (small purple and larger red) around 80.06.

SPX is completing a rising wedge at the upper (white) channel bound — harmonic targets for 1.618/.886/.786  patterns between 1463.32-1463.86.

UPDATE:  11:20 AM

Any minute now…

UPDATE:  12:00 PM

Each of this morning’s targets was reached.  Should get some back tests, but the next move is down.

The rising wedge on SPX broke down and it just broke through the support I was worried about — the lower bound of a larger rising wedge (purple.)

The EURUSD rising wedge broke down, peaking within .0002 of our 1.2971 target.

DX broke out of its falling wedge higher than I anticipated, at 79.375 rather than 79.334.  I have redrawn the channel to reflect the new bottom — ditching the after-hours plunge on the 21st.

SPX and DJIA should turn negative on the day very soon.

I hope everyone was able to make a few bucks this morning.  Downside targets coming up in a few minutes…

continued…UPDATE:  1:20 PM

The harmonics are shaping up pretty nicely, with multiple patterns targeting the same area — my 1444-1446 target from last week.

This is a pretty busy chart.  But, focus on the red and the yellow grids.  The red 1.272 and the yellow 1.618 intersect there today — with the potential red Crab Pattern (B is at the .886) targeting 1439 by Monday the 1st.

UPDATE:  1:55 PM

We dropped to the white channel midline and got a bounce there — back-testing the .618 of the red Crab Pattern (where I had charted the yellow Crab’s Point C.)  We also back-tested one of our broken yellow channel lines.

If we can punch through the white channel midline currently at 1553.82 we can call the back-test over and get on with the downside.  We should next run into support around 1452 — the previous low — but have the potential to get as low as 1448-1449 by the end of the day and still stay within the red channel down and our large white channel.

This is a very narrow channel within which we’re falling, and we’ll need to turn down again within the next few minutes if we’re to keep it that way.  I believe we will.

No idea what the overall wave count is, but the initial move down from 1463 to 1453 looks like a wave 1 to me — meaning the bigger, faster wave 3 is still ahead of us.

More in a few…

UPDATE:  2:25 PM

Just took out the previous low of 1452.06.  We might get a back-test of the white midline up to 1453.60, but it’s not necessary.

Next white channel line is 1449.  But, the previous low (Sep 20) is 1449.98.  Expect at least a bounce there.

UPDATE:  3:00 PM

There’s the next white channel line.  The 5-min RSI channel that shows plenty of room for a bounce — and plenty of room for the 1445 target — probably with positive divergence — but we’ll take another look when we get there.

It’s also the 1.618 of the small purple pattern and the 2.24 of the light blue pattern.  The bottom of the white channel is just below at 1444.37 — right next to the yellow pattern 1.618 at 1445.15 and the red pattern 1.272 at 1445.33.

While it’s possible we’ll break beneath the channel bound, I don’t really expect it.  If we close in the vicinity of 1445, I’ll close out my shorts and sit in cash overnight.

More in a few.

UPDATE:  3:15 PM

Closing shorts here at 1444 and playing an expected bounce.

There’s no positive divergence on the 5-min RSI, but we did tag a solid trend line of support.  It’s entirely possible we’ll go ahead and tag the 1439 level, but staying short for another 6 points when we just tagged (overshot, really) the white channel bottom is a dicey move.

The SPY 144.5 and 145 puts I bought at the top quadrupled in one day, and that’s good enough for me.  I’ll plow some of my profits into some calls and see what happens.

Remember, the next higher channel line is right near 1450 — the level of the old low from Sep 20.  I need to study things a little more, but I’ll pick that as an initial short-term long target — with stops at 1443.

Our little red channel upper bound is currently around 1451 (1450 at the EOD.)  At the very least, we should go up and test the 5-min RSI channel — and probably break through it.

The daily RSI, by the way, provides a pretty good indication of the support at this level.  Of course, if it should push below the white TL, watch out below.DX is hitting resistance near the midline of its channel.

And, the eminis are picking up good support here.

From the looks of things, SPX might go down and tag that 1439 in the morning.  EURUSD and DX have a tiny bit more to go to reach their midlines, and SPX could very well see some carry through from today’s unexpected (except by us) bloodbath.

SPX’s daily RSI actually closed slightly below its trend line; so, I’ll be looking at the implications after I have a chance to catch my breath.

Obviously our 1443 stop was taken out, so we’re officially in cash overnight (although I left some calls in place, just for grins.)

More later.