Sometimes I cringe when I place a target on a chart. Such was the case yesterday when ES reached our IH&S target at 3425. If it kept going, it was sure to backtest the intersection of the broken rising white channel at the falling channel top. Was that likely in the midst of election and pandemic turmoil?

Apparently so, because that’s exactly where ES ended up overnight.Although I tire of saying it, this is an important threshhold for the overall market – which has benefited smartly from a rescue maneuver that wasn’t even really necessary.

continued for members…Note that the C=A pattern is still alive – unless ES breaks out.

SPX’s version:The biggest determining factor, of course, continues to be VIX. It is now testing the bottom of its rising channel – the epitome of a potential turning point. Though it might ultimately break down, the charts suggest at least a bounce – but only because of the other factors.

The .382 Fib intersection with the rising white channel was supposed to be today. So, unless we get a massive selloff in equities starting in 10 minutes, this is a missed target for now. As VIX decides what to do, note that USDJPY is finally breaking down again… …now that it has driven NKD to new highs. USDJPY’s drop is combining with EURUSD’s rally to its channel top… …to allow DXY to finally break down. It has further to go, confirming that USDJPY has further to go.If DXY is to tag our 91.358 or 89.88 target, it will likely give GC and SI some legs. Note that GC is back above critical resistance at 1923.70……and SI has only its SMA50 standing in the way of a bounce up to 27.25. …and require TNX to break down.A breakdown in TNX would, as we’ve discussed, affect the 2s10s which was again on the cusp of a breakout but is now again on the cusp of a breakdown.This would also give RB and CL license to rise a little higher – perhaps to backtest their SMA200s or even channel tops – if the goal is to have ES break out rather than than complete a 3rd wave of a 3rd wave (or C of a C.)  We should know soon enough. And, just in case the picture isn’t complicated enough, the FOMC releases its latest rate decision at 2pm today.

I have to be out of the office all morning, but should be back shortly after 2 to take a gander.

GLTA.

UPDATE:  3:10 PM

SPX has joined ES in tagging its channel top.

VIX held its channel bottom so far. USDJPY is finally collapsing……driving DXY toward our downside targets……which is turn is giving GC and SI wings.