It turns out that the American consumer isn’t quite as healthy as many pundits believed.  August retail sales came in at a 0.6% MoM increase versus 1.0% expectations, and July’s 1.2% spike was revised down to 0.9%.  Congress could even take action…if the market tanks.

As expected USDJPY has now joined the robust list of factors showing a bearish 10/20 cross. All eyes now turn to the Fed.  Can it save us from the horrors of a market which fails to rally every single day?

continued for members…

In addition to its bearish 10/20 cross, USDJPY has now broken below that last fan line and the purple channel midlilne (note that the 103.43 target could come as late as the end of the month.)This will put additional pressure on DXY……unless EURUSD breaks down – which, as we discussed yesterday, seems likely in the near term. It’s worth noting that while gold and silver are still holding important support, SI has experienced its own slight bearish 10/20 cross.Gold is holding on to a very small bullish cross.  Both GC and SI are trading up through both their SMA10 and SMA20, which is nominally bullish. CL and RB continue to rally, though I believe profits should be taken here from the recent bounce. Bonds are still in a holding pattern, and it continues to look very tired. With Citi’s layoffs announced yesterday, perhaps investors will turn their attention to the very substantial difficulties that the current rate structure poses to the financial sector. VIX continues to hold the TL we pointed out yesterday.  This should be a good entry point for buying vol (with tight stops in case the Fed surprises to the dovish side, which I don’t expect.)As long as it does, I continue to look for the correction which started on Sep 3 to continue. UPDATE: 1:55 PM

Not much change since the open.  FOMC decision coming up…

UPDATE:  2:05 PM

No change in rates, 0.1% Fed Funds forecast for new several years, inflation goal is now officially over 2%. Net message: more debt monetization, wishful thinking from Fed.

Gold and silver are holding their own…

…while DXY is very slightly higher, USDJPY continues its drops, and EURUSD is slightly lower. I’ll post more after the press conference.

UPDATE:  3:55 PM

No big surprises during the presser. Stocks are selling off and the dollar is showing a little strength on a slight increase in rates, steepening in the curve. I’ll have more to say about Powell’s comments in the morning.  First, a little reflection…