NVDA fell as much as 7% following earnings and guidance which failed to excite, but has rebounded to a 4.2% loss as we approach the open. If it can’t hold 122.62 after the open, our 110 target is the next significant support.

The broader market was already having a tough day before the NVDA print. As has happened frequently this past week, the algos got busy and ES rebounded strongly overnight.

continued for members…

Although, it should be noted that ES has now broken down from its rising white channel just like SPX already had. The SPX version:

Note that SPX’s RSI is backtesting an internal TL of resistance which has signaled several prior dips.VIX is still on a bubble… …while DXY is getting a boost from the euro. It is set to backtest its SMA200 today and seems likely to drop through it in order to backtest channel and trend lines in the short run.  Longer term, it could still break out but as we’ve discussed, this would present inflation problems. As we’re discussed, DXY needs to rebound if import prices (oil/gas in particular) are to remain under control and provide a path to 2% CPI. This is quite important as both the 2Y and 10Y are in danger of breaking down, with the 2Y having shown the greater weakness ytd, Remember, its those 2Y yields which, when they fall faster than the 10Y after the 2s10s breaks out (which it has) lead to market crashes.  Our charts suggest that the 10Y will fall to 3.3-3.6% by election time, after which we could very well see inflation tick higher unless the economy falls into a recession.

GLTA