The neat little falling channel guiding stocks lower since our Oct 12 top call [see: A Cure?] has broken down – slicing right through our ES 3329 target and accelerating toward our backtest targets.
Every single one of the factors responsible for driving algos higher over the past 7 months is having a very bad day. Consider VIX, which blasted through its SMA200 and is closing in on our next upside target at 39.49…
…or CL, which has dropped through our 38 target, opening up the path to 35.45 and lower.
Given the impending lockdowns in Europe (and the fact that the US is only 2-3 weeks behind it in terms of case growth) and the lack of any stimulus package any time soon, the prospects for the market stabilizing are not looking good.
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