Another VIX-inspired, holiday weekend ramp in the futures in the face of dismal headlines… What a shock. Not.

continued for members…

The recently established .786 and .886 Fibs and the longer standing .886 Fibs are back in the picture, with ES 3196.25 and SPX 3202.64 looking much better… … following the algos’ attention to VIX’s retest of its SMA200 (the thick red line.)  We got the bounce we expected on Friday, but it didn’t last. The threat is that we get an extended period of at or below the SMA200 as occurred during much of 2019.As we discussed all last week, the other signal was the 10/20 cross, where VIX’s SMA10 passed back below its SMA20 after a 15 session bullish (bearish for stocks) cross.This second, deeper test of the SMA200 and the yellow TL from 2018 is a very obvious shot across the bow to market bears, as it threatens a breakdown to the .886 or lower.

The other glaring signal to the algos is EURUSD’s pop out of the falling white channel following last week’s golden cross……which has allowed DXY to break down through the little red TL. And, as we noted last week, USDJPY’s SMA10 remains above its SMA20 as it continues to levitate following its channel breakdown.The Dow might even get another crack at its SMA200 (26254.15) before all is said and done……as COMP makes new all-time highs… …and DB manages not to crater for one more day.

The bond market continues to remain on the sidelines with the 2s10s at 53 bps …while the TNX remains broken down with a backtest. In other words, it remains potentially bearish for stocks but has managed not to follow through just yet. The 2Y is flat, but below the support at 17bps.Oil is clinging to a new, rising TL with another backtest of its red, dash TL and channel bottom likely in the coming day or two……while RB is already on its way to a backtest.I’m still going to take the day off to work on the big picture (to be posted tomorrow morning), but wanted to get these charts out there in the meantime.

GLTA.