As we await Jay Powell’s comments at Jackson Hole, the futures are slightly positive – backing off slightly from the 34-pt V-shaped recovery after yesterday’s run-in with hawkish Fed presidents and another brief 2s10s inversion.This morning, we’ll hear from Jim Bullard (a perennial dove) and Jay Powell himself. So, we should expect another very volatile day.

continued for members…

As things stand, it’s looking more and more like the Aug 7 and Aug 15 lows will stand in for the Aug 14 and Aug 20 lows forecast by the analog.  But, we’ll have to see if we get through the day unscathed.

VIX is back above its channel top, but is below its SMA200 — mixed messages, to be sure.The rest of the charts…

I’m dashing out for a breakfast meeting, but will post again after the open.

UPDATE:  10:40 AM

Powell’s comments were dovish enough, stressing the global economic risks, that the market is recovering nicely from this morning’s China trade-related dip.  VIX has broken down and is eyeing the next TL to drop through.SPX has broken out of the falling white channel again.

ES is back above its neckline.

CL is back above its yellow TL.And, USDJPY is tentatively holding a small TL.SPX should be back in the green shortly.

UPDATE:  11:30 AM

SPX was back in the green for all of 25 minutes before Trump dumped a doozie on the markets, tweeting:

“We don’t need China and, frankly, would be far better off without them”, and ordered “Our great American companies… to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.”

He further tweeted that he would be upping the ante in the trade war with China.  Needless to say, stocks are not amused.  It looks like we’ll get that second downturn after all.

I would love to see SPX tag 2839 and bounce.  That would put the analog back on track, with today’s lows servicing as the second low, arriving 3 days later than our chart indicated but one day later than the analog originally indicated if the top had occurred on Jul 30 as originally prescribed.

If this played out, we could theoretically push back the Aug 27 high to Aug 30 — the end of the month.  In general, stocks prefer to rally into the end of weeks, months and quarters.

More later.

UPDATE:  2:50 PM

ES just reached the red TL support at 2853.  While SPX looks like it could go further, we’ve often seen rebounds based on ES support take precedence. UPDATE:  3:56 PM

SPX just reached our channel bottom and DJI just retested its SMA200.  This is a great bounce point, and right in line with the analog.  Only problem is…it requires a great deal of faith to go long here with all the attendant weekend gap risk.