With the poor inflation data coming out of Europe, we see some equity weakness this morning combined with renewed dollar and yield strength.
I will note a couple of things.
On the Russell futures, we remain above the breakout trend line (though if we open here, the cash session will—once again, ffs—be just under its:
If this level can hold, and if we see renewed strength (housing starts were good, for instance) I can probably count this as a 1-2 (up). If it fails, I would imagine it’s going to try to head for the orange trend line again
On the S&P, a similar picture. We’re at the magical 20% level that has served a magnet a hundred times now. If we see relief, this looks like a 1-2 (up) as well, but if not, I suppose it may want to head the lower rail of the bull wedge (arrow).
I have counted the cash session as a “nest,” and if we open too low, that won’t work so well, but if we don’t fall apart and take out prior lows, I will probably be able to count it as a single 1-2, as with the futures. I can’t really imagine strong selling going into FOMC (we usually stay somewhat stable) but anything is possible.
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