September PCE held steady at 0.3% MoM and 6.2% YoY while personal spending came in hotter than expected. This should officially close the door on any speculation regarding a Fed pivot.

Coming after disappointing earnings and guidance from the largest, most important corporations, one might expect at least a slight decline in the markets. One would be wrong. Futures are back to flat as we approach the open because VIX-driven algos are still in charge and VIX has been driven lower.

VIX futures have been playing cat and mouse with their SMA200 since yesterday…

…and the index will join in shortly.This pattern has been playing out daily since Oct 13, when VIX’s breakdown stopped stocks’ decline in their tracks.

continued for members…

The big picture is relatively benign for ES/SPX.

But, COMP and even AAPL are still showing backtests – meaning this bounce will fail and yield lower prices unless they can rejoin their broken channels. As has frequently been the case, currencies are playing along. EURUSD bounced before even reaching its SMA10… While USDJPY rallied up to its 1998 highs again.Between them, they have choked off DXY’s bounce for another day. CL and RB are both off this morning, their charts warning of lower prices… …which jibes with XLE’s deep retracement to its .886 Fib. This puts TNX back below the 4% mark, clinging to a TL from Aug 2 after tagging the top of its rising purple channel from Aug 2021.UPDATE: 11:20 AM

AAPL found its feet and rallied – not only back into the broken channel but to its SMA200.  It needs to hold 151 in order to maintain upward momentum. No surprise, the Dow did the same.  Of course, past backtests of the SMA200 didn’t turn out very well for DJIA. Note that ES has retraced .886 of its earlier dip…  …and COMP is backtesting a little TL off recent lows as well. Bottom line, everything is spelling more downside except for AAPL and VIX. At this point, it’s enough to keep stocks from collapsing – a typical ramp job in advance of a Fed decision (Nov 2) which should be bearish for stocks.