USDJPY reached our upside target this morning, tagging the top of the falling white channel from 2015.  This is the terminus of a move which began in late March [see: Algos to Markets – All Better.] This is a pivotal point for the pair, particularly since ES reached its IH&S target overnight.continued for members…Note that VIX has also completed an .886 retrace of its latest pop… …and, RB has reached TL and Fib resistance.  I might regret it, but I’d revert to short here with tight stops.Bottom line, this could be the end of the latest nonsensical pop in stocks. Much of it will depend on whether or not USDJPY can break out of its falling white channel.

Since SPX is now defending its 2.24 again, it would be logical to give USDJPY a little rope, with obvious stops back around the SMA200 (110.12) and see if it can reach horizontal resistance at 114.50 — the three previous highs.

If oil and gas can put in a serious downturn soon, then the DXY and TNX should complete their drops — leaving stocks in a precarious position. A substantial pullback by CL/RB, USDJPY, DXY and TNX could do some real damage. But, if TPTB have played their cards right, any drop by SPX from here will reach support from the 2.24 and SMA200 before any serious damage is done.  Either way, this is the most danger stocks have faced since April. GLTA.