Yesterday’s decision to go long at SPX 2115.74 paid off in spades, even more so if you held on through the close.  CL, which backtested the white channel top as expected, verified the falling purple channel on the bearish EIA data dump and then proceeded to break out of that same channel overnight.

Likewise, USDJPY — which had broken down through a rising TL from Sep 26 — magically recovered overnight.

The eminis are ecstatic over these developments and have now bounced 30 points from yesterday’s lows.  There’s a dark cloud on the horizon, though, which could spoil the party.

continued for members…

The daily ES chart shows a clear breakdown and backtest or a test of a well-established channel bottom — depending on which channel you like.

Thus, I’d take profits if you’re still holding long when SPX reaches its initial gap higher of 2142.47.

UPDATE:  9:33 AM

That was a little higher than expected.  I’d short here at the white channel top: 2145.05.

I’d also look for CL to take advantage of this spurt and reset lower – either to the red channel bottom at or at least the purple channel top at 50ish.

UPDATE:  9:45 AM

Giving up on the short at 2146.2 and will revert to cash.  Lots of spoofing going on this morning, and VIX is getting body slammed.

It’s typical end-of-the-week goofiness.  I rather expect this ramp to fall apart, and would be happy to stay short through Monday even if it means a little short-term discomfort. My swing target remains 2103-2110.  However, we’ve also seen plenty of times when a gap higher on the open is defended all day long, held in place by the threat of a VIX plunge or CL breakout.  

We had a death in the family yesterday, and I’m just not up for this nonsense today.  I hope you’ll forgive me, but I’m going to take a day off and be with my family.

As far as the markets go, a drop back through the white channel top at 2146 should be shorted, while any rise above 2148 should be bought.  However, I won’t be surprised if they prop it up until later today or Monday.  Trade safe.

UPDATE:  12:30 PM

A quick note – SPX just tested the 2134.72 level again.  There’s at least a 50/50 chance of a  sizable bounce here.  Since I won’t be watching it, it’s worth covering here at 2135.71 for those who shorted on the drop through 2146.  If it doesn’t bounce, or bounces but drops back through, I’m still a fan of 2103-2110 either later today or Monday.

And, many thanks to those who have messaged me here and in private.  I very much appreciate your kindness.

 

 

 

 

 

 

 

 

 

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