Futures are off 40 points from the overnight highs as we cruise into the last week of the quarter. Advanced Durable Goods for August surprised, posting a 1.8% increase vs 0.7% expected on strong growth in shipments and transportation in particular. Bottom line, nothing here to support a continuation of massive liquidity injections.

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The equity situation hasn’t changed other than the recent overshoot on bounces in SPX and ES. The implication is that the rising yellow channel has been rejoined and its bottom backtested. By the end of the day, the rising red TL from the Sep 20 lows and SMA10 (4417) are likely to be tested.

VIX is still back in the falling white channel and below the SMA200, though the 10/20 SMAs remain in bullish  (bearish for stocks) alignment. USDJPY continues to exert upward pressure as the euro buoys the dollar. CL is still signalling a potential breakout which I believe – until proven otherwise – is a headfake. RB, which is more pertinent to CPI, remains subdued.Last, TNX has either reached a reversal point or is about to break out. I’ve been inclined to expect a reversal, but rising rates is obviously part of the reflation trade story – an important element of propping up stocks into quarter end.

More later…