SPX has now achieved two of the three milestones that could see it return to an unfettered bullish state of affairs. Thanks to the continuing and precision meltdown of VIX, it was able to not only hold the IH&S neckline, but pop back above its Fib 2.24 extension at 2703.62. 
And, lest there was any doubt about the importance of this resistance (now support), consider the machinations that went into holding it throughout the rest of the session.
Now, it’s ES’ turn to assault its own 2.24 at 2728.79. The Dow’s rising wedge hints at a bit of drama, but VIX still has plenty of downside potential. Can the bulls hold on this time?
continued for members…
The big picture for SPX and ES. Note that SPX is coming up on its purple channel top and .618 at 2742.92, while ES faces a duo of channel midlines at 2714ish, its 2.24 at 2728.79, and then a TL off the January highs at 2742ish.
COMP’s SMA200 is now only 5-6 points below its recent lows. But, I don’t suspect TPTB will give up SPX 2703.62 in order to accommodate a tag at this point. Better to keep the momentum going and give it another try with more downside cushion in the bank — say, when SPX reaches its purple channel top at 2742.92.
Note that USDJPY has postponed its breakdown, taking a new, slightly less bullish vector. This makes the 106.33 target much less likely, as it would leave SPX/ES vulnerable at a time when they need plenty of support.
Re EURUSD, what can I say? 1.2597 is a waiting game, and it will happen when it happens — probably at the end of May, the way things are going.
I read yesterday that the dollar shorts are at record levels. But, from my vantage point, DXY looks perfectly content to wait until the purple channel bottom has risen to recent lows rather than plunging to tag it right away. Like euro bulls, they might be facing a long, slow road to a mediocre gain.
