There’s a well-known scene at the end of the classic film Casablanca where Captain Renault (Claude Reins), having seen Rick (Humphrey Bogart) shoot a Nazi in order to enable Ilsa and Lazlo to escape, tells his men to “round up the usual suspects.” It saves Rick, Ilsa and Lazlo’s collective bacon (though I suspect it sucks for the usual suspects.)

So it is with the algos driving equities lately. With oil/gas prices on their back heels and VIX being bid up every day by nervous carbon-based investors, it falls to the the usual suspects in the currency markets to provide algos with the proper “motivation.”

Think of USDJPY’s breakout not so much as a bug, but a feature of the modern market — one of the many quiddities which allows futures to ramp higher on, say, disappointing economic news.

While it is sometimes difficult to know when stocks will get much-needed support, these tools have been fairly predictable and have provided excellent trading opportunities.

continued for members…

VIX “broke down” overnight, but this hasn’t stopped it from making higher highs the last few days – and it remains broken out of the falling white channel and still has the attraction/potential support of the gap close at 18.21 to consider. So, as expected, USDJPY is ramping up for a potential breakout.

It has enabled NKD to complete a very robust backtest. It’s hard to say whether ES’ SMA10 will hold… …particularly with such downside potential in the charts.Many charts are on the verge of a breakdown or breakout, including DXY – which has reached that TL of resistance we discussed yesterday… …but which seems to have at least a little further to go due to EURUSD’s breakdown below its SMA200.Gold and silver seem as perplexed as ever, with GC seemingly rolling over…and SI not bouncing very enthusiastically off its SMA200.

Then there’s oil and gas. They were following our script to perfection until the Ever Given, a ship as long as the Empire State Building is tall and as tall as the Eiffel Tower, ran aground and got folks to wondering about oil tankers and deliveries being delayed.

So far, we’ve seen a fairly muted response from RB – though it could easily take the opportunity to backtest the SMA10 or even the small channel top at the SMA20.I expect the mess will be cleared up in the next day or two and CL/RB can resume their plunges – the better to allow TNX to settle lower.

I have a couple of conference calls this morning and then have to take the rest of the day off. I’ll post at the close if anything unusual happens.

GLTA.