Nothing much has changed since yesterday.  SPX bounced around in our target zone, coming within a few points of its SMA200 as VIX went nowhere.

The one notable exception was AAPL, which after tagging our downside target on Jan 3 $from last November [see: AAPL Discovers Gravity] reached our upside target yesterday. We originally charted this upside target on Jan 3 [see: Update on AAPL, Jan 3] and the IH&S pattern reinforced it three weeks later.  Had AAPL not reversed, the additional downside potential was substantial.

continued for members…

The daily chart hints at higher prices, so let the price action be your guide.  If nothing else, it’s time to tighten up those stops.SPX and ES are still playing things close to the vest.

VIX is pushing the bounds of its red channel bottom.  A bullish redraw off the previous lows puts the bottom no lower than 14.87. Remember we have EIA inventories due out this morning.  CL and RB tumbled a bit yesterday on API inventory builds.  I’m looking for additional downside that will at least flesh out the rising channels. And, the currency picture is still benefiting stocks – with DXY’s decline postponed another day. Last, the volume is rising on our yield curve model.  As we’ve been discussing for a week, now, the 2s10s must either break out above the dashed, red TL or down through the yellow TL.  Both are bearish for stocks.I’ve marked the previous SPX highs on the 2Y v 10Y chart in the hopes it will help identify future tumbles.  It’s a work in progress.The 10Y still looks very likely to dip to at least 24.98.  Though, each passing day increases the odds of the deeper drop to 21.72. At this stage of the game, such a plunge in rates would almost certainly reflect a flight to safety — from declining stocks. I have a few meetings this morning so will be out until about 1pm.

GLTA.

UPDATE:  1:00 PM

Not much to report on other than RB and CL which both shot higher despite a build in CL. Between that and the algos’ foot planted firmly on VIX’s neck……SPX and ES have had little trouble holding support.  Given that they’re both sitting just below their SMA200s and haven’t been allowed to dip below support for two days now, the odds of another pop higher is increasing.

Currencies are once again propping up the DXY. Unless something dramatic happens, I’m going to take off a little early today.

UPDATE:  6:00 PM

Another exciting day!  ES is officially coiling…

…while SPX is running in place…

…and, VIX is playing dead. CL and RB are still on the bulls’ team… …as is USDJPY.When we see coiling like this, it’s just a matter of time before we get a breakout or breakdown.  ES 2728.79 remains an important line in the sand, as are both SMA200s.