It was an interesting weekend.  Futures sold off as much as 8 points yesterday, but were right back to green on this morning’s open.  It remains to be seen whether they can remain in positive territory as CL sells off again.

We remain short from Friday at 2146, but there are plenty of trip wires ahead.

continued for members…

By bouncing as it did, CL has the opportunity to tag the red channel bottom without breaching the white channel top on another backtest.  I show the intersections at about 49.45.  How CL reacts there will determine much of what we can expect today.

USDJPY, meanwhile, remains quite coy.  It has broken below the rising red TL again, but remains just below the previous high — threatening to break out.

Last week, we wrestled with which is the legitimate rising channel from Feb.  That question is no closer to being answered, as the Brexit selloff was truncated before it had a chance to establish a channel low.

That is, unless SPX has really broken down and intends to tag some of our lower targets.

I have painted the downward facing harmonic grid from the Brexit lows white, as I believe it’ll come into play with regards to our ultimate target in the near-term.  We’ve tagged the white .382 already, and the bounce wasn’t all that impressive.

We’d likely need to see VIX break out past 18.

And, we’d probably need CL to complete the little H&S it’s been working on.

And, then, there’s the real wild card: DB.  So far, they’ve done an excellent job of keeping it on a positive track.  And, there’s no reason to believe they won’t continue to prop it up.

UPDATE:  10:06 AM

SPX has reached its red .618 as CL has reached its neckline.  I assume CL is going to bounce, so we’ll be watching it closely.

UPDATE:  10:09 AM

CL is acting a little bouncy.  I’ll cover our short here at 2127.95 and reopen it if CL drops through the neckline.

UPDATE:  10:48 AM

CL is backing off its bounce, so I assume SPX will be free to go lower.  Back to short here at 2132.03.

CL’s back below its SMA10 and seems headed lower.  The neckline would be big, so I’m still very attuned to a potential headfake.

Note, also, that VIX seems to be holding its SMA200.

UPDATE:  12:00 PM

Quick update…VIX is threatening to break down, sitting right below the SMA200 and at the SMA5 200.CL is bouncing back and forth between the neckline and SMA10.   USDJPY has dipped below a fan line, but hardly decisively. And, SPX is hanging in there.

The best head fake so far: DB, which dipped below a TL and its SMA10, but is back above.If our yellow target at 2105.34 is in play, we should get some movement pretty soon.

UPDATE:  1:00 PM

USDJPY is doing its best to keep SPX in check, but CL has other ideas.  VIX is straddling the line between a rally and a dump.  I feel pretty good about 2103-2105, and would hold short unless CL really takes off or VIX plunges below 16.3.  Please watch your stops, as either is easily accomplished if/when TPTB like.  I’ll be out for the remainder of the day and won’t get a chance to check the charts until this evening.   GLTA.

 

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BTW, I have to take off early today.  I’ll need to wrap up around 1PM ET.  Also, TOS has crashed twice on me this morning — once right before the open.  Not sure what happened with the latest update, but if you see things happening and are wondering why I’m late in posting about it, that’s why.