According to Missouri Republican Roy Blunt, “If we’re going to do it this year, I think it’s now or never.”  Of course, a $2 trillion package will face stiff opposition in the Republican Senate, especially with more and more senators prudently distancing themselves from President Trump.

The bond market is torn on whether or not to believe it, with the 10Y again testing overhead resistance. And ES, which tagged our next downside target after hours yesterday, isn’t very optimistic at all.continued for members…The bigger picture: While VIX retreated from its SMA200 yesterday, it hasn’t yet broken down and we finally got the bullish 10/20 cross we’ve been watching for. The implication is that stocks are likely to tumble.

As we discussed yesterday, a breakout in 10Y yields (breakdown in ZN)… …means a breakout in the 2s10s, which would decimate stocks.

DXY is bouncing on the rise in rates, but I don’t look for it to continue. It’s now been over a month since GC first dropped back through its former highs (1923.70.) It has tried several times to climb back above 1923 with yesterday’s being the latest.Both GC and SI remain in a bullish 10/20 cross, and the fact that they haven’t broken down yet should give bulls hope. The failure to reclaim their highs, though, is a reminder of the importance of the stimulus package. If Republicans are openly stating their party’s reluctance to pass a Pelosi-Mnuchin brokered deal…

“Republican vote counters in the Senate won’t have the 13 votes needed to pass a stimulus package as large as Pelosi is seeking, according to John Thune, the party’s No. 2 leader in the Senate.”

…how eager would they be in the wake of the election – regardless of who wins the White House?  The lame duck session could be even more contentious.

CL and RB are bouncing this morning, though both are now officially broken down and RB is now in a bearish 10/20 cross.

UPDATE:  3:50 PM

Hmm…where have we seen this one before?  VIX’s 10/20 cross, a bullish .11 this morning, is hanging on by its fingernails.As a result, ES has rebounded nicely. Its SMA10 has risen slightly on the day, currently at 3468.20 – which would put ES just above top of the falling red TL if VIX breaks down any further.

Though SPX’s SMA20 began the day at 3412.25  – which SPX didn’t reach earlier today – it will be more on the order of 3422 tomorrow.  In other words, the charts will reflect a tag after the fact – a slick trick for those times when the CRUSH VIX button is mashed a few minutes early.