Futures were all over the map last night, with ES’ 113-pt range dictated almost entirely by factors as opposed to election results – which, contrary to Trump’s declaration, are still AWOL. Note that ES tagged our IH&S neckline (also the former H&S neckline) target where it is currently running out of gas.
As expected, the most important factor was VIX which collapsed over 18% from its overnight highs – slicing through channel midline and the 10, 200 and 20-day moving averages.
continued for members…
With futures up 50 points, the other factors have no reason to keep up pretenses.
USDJPY is the first casualty.
Together with EURUSD’s failure to break down… 
…it has contributed to DXY’s lackluster response.
The 10Y is also pitching in. As expected, yesterday’s pop was a head fake.
With the 10Y backing off, the 2s10s should continue to flatten. 
In fact, that’s what we’re seeing.
The failure of DXY to go much of anywhere has resulted in more muddling from GC – which popped back above its SMA10 and SMA20…
…and SI – which briefly entertained a tag of its channel bottom.
Last, note that CL and RB have both popped up above yesterday’s sell signal levels. With EIA inventory coming out this morning, that’s not unusual. Watch your stops.
Bonus chart: If I didn’t know any better, DJI’s chart suggests this rally running out of steam here. The gap was closed and the channel midline tagged. The current futures ramp job is not enough to produce new highs – unless of course USDJPY rallies or VIX collapses another handle or two.
more later…
UPDATE: 3:07 PM
The ramp job that keeps on giving…
VIX’s collapse is somewhat historic – one of the biggest I can remember at a daily range of 8.82. 
There is no justification for this, just piling on.
I think it’s overblown, and am looking for ES/SPX to settle back down. It’s hard to say where, though, as TPTB are clearly not going to ignore any downside.
CL and RB have also overshot the necessary move, so I’m looking for both of them to settle lower. Despite the supposed big draw reported by the EIA, oil and gas inventories are both well above their historical norms. http://ir.eia.gov/wpsr/wpsrsummary.pdf
Likewise, USDJPY has given too much back to propping up stocks. I still expect it to settle lower, though it appears NKD might notch a new high beforehand.
DXY is still vulnerable…
…especially given TNX’s retreat…
…which in turn has dinged the 2s10s back down to support.
A drop below 60 bps would be a real problem for stocks. The ideal timing of the 35 bps tag would be Nov 19.
DXY’s reluctance to break down is still not helping GC and SI. The prospect of them breaking down to their SMA200s is still a clear and present danger.
Last, the Dow has expressed its extreme displeasure with overhead resistance of any kind. It’s just silly, of course, but the record books will consider it just another good day.