When does “it’s over” mean it’s not over? When the market plunges 65 points, of course.
The 2% hiccup came when Fox’s Martha MacCallum asked Trump advisor Peter Navarro whether John Bolton’s claims that Trump delayed imposing sanctions on China over its policy of interning Uighur Muslims would jeopardize the China trade deal. Navarro, fresh off accusing China of deliberately seeding the virus in the US by sending “over hundreds of thousands of Chinese citizens here to spread [it] around…” didn’t equivocate.
“Do you think that the president — he obviously really wanted to hang on to this trade deal as much as possible and he wanted them [China] to make good on the promises because there had been progress made on that trade deal,” MacCallum told Navarro. “But given everything that’s happened … is that over?”
“It’s over,” Navarro responded.
ES quickly plunged below its SMA10 and 2.618 Fib, but was promptly rescued by a plunge in VIX and spikes in CL and USDJPY which, not so coincidentally, popped back above its SMA10.
In all the turmoil over 9.2 million sickened and 475,000 killed by COVID-19, the ongoing social unrest, and an economy which is arguably teetering, it’s sometimes easy to forget the China trade deal and the months during which the market took its cues from the daily press briefings and chopper talk quips about how magnificently negotiations were going.
With the White House amping up its rhetoric over China’s culpability for the pandemic, I imagine Navarro’s initial assessment was the honest one.
continued for members…
ES has reached a channel line and horizontal resistance which should put a lid on any more upside.
But, if it does break higher, we know where it’ll go. June 30 is a long ways away.
The SPX version with a falling white channel that still looks pretty good to me, but there’s room for adjustment. The key will be how long current prices can be maintained as this will determine the top of the channel and, ultimately, the timing and price level of any downturn.
As mentioned above, this rally has been brought to you by factors which are exactly in line with our expectations: VIX cratering to test the SMA20 all over again…
…CL rallying to our gap close target – a signal to short…
…and USDJPY spiking higher – but destined for lower lows.
Aside from VIX’s downside potential, none of these algo-boosting factors should hold. Thus, I’d fade ES’ rally.
USDJPY has substantial downside… 
…as evidenced by NKD’s 10/20 cross…
And, DXY should take off as soon as EURUSD begins its selloff.
Having finally closed its gap, CL should be done rallying.
UPDATE: 10:25 AM
ES is likely aiming for its SMA5 200, now at 3121, but might wait until it’s above the yellow channel midline at 3124ish.
USDJPY has broken down and is heading south…
CL should be done and the little rising wedge should break down soon.
But, VIX’s bounce off the SMA20 is looking iffy, with multiple targets in the range between the SMA200 at 25.41 and the yellow TL at 26.21.
UPDATE: 10:49 AM
It lasted all of 3 seconds or so…
On another note…I post about AAPL fairly often. Note that it has reached the top of a trend line which, if it holds as it has in the past, would allow AAPL to reverse intraday here at its 1.272.
Reversals at the 1.272 Fib extension most often retreat to the .618, which in this case would be 283.83 – a 20.9% drop. 
UPDATE: 3:15 PM
Another one of those days…ES hasn’t been able to break above horizontal resistance, but has extended the downturn yet another day. No new developments or departures from the same outlook as the last week or so.
Note that EURUSD bailed on its potential breakout and DXY from its potential breakdown. USDJPY is backtesting the broken rising white channel. And, VIX is still bouncing above its SMA20 with the potential dip still an option to keep stocks’ upside option (or downside protection) intact.
I have to jump on a call, but will be back after the close to wrap up if anything interesting happens. GLTA.
