SPX is back above its SMA200.  All it took was convening the Plunge Protection Team which was — purely by coincidence — followed by VIX collapsing from 36 to 15, WTI spiking from 42 to 55, and USDJPY ramping from 104.60 to 110.90.

The algos are very well versed in how to respond to such activities.  They didn’t disappoint. The only question, now, is whether SPX can hold this important level of support.  The last three times it was here, things didn’t go well for the bulls.continued for members…

The last goal should be met on the open: getting COMP back to its SMA200 at 7462.25. From that point on, it’s a matter of watching VIX.  A breakdown means we could see new highs.  A bounce means we probably won’t.In terms of targets…at 2766 SPX runs into a trend line from recent highs, creating an opportunity for an IH&S if it reverses there.  After that, we have a series of channel and Fib intersections to look forward to. DJIA has an interesting target at 25638.46 — the Point B of a cool Fib extension — if the downside case is still intact. And, USDJPY has a choice between a .618 or SMA200 at which to reverse…

…while EURUSD continues to hold on for dear life.