I wasn't planning to do a post today, but it looks as though equities are attempting to bounce here now, so I thought I'd post the three main charts that look important right now.
On ES declining resistance from the highs has been broken overnight and that's a promising sign. f this continues then we may well see ES form an IHS at the 1178 neckline and I've shown on the chart how that would most likely look. If that forms and breaks up, the IHS target would be 1198:
More important however than that declining trendline on ES is the rising channel support trendline on 30yr Treasury futures (ZB). Until that breaks down I don't think there can be much of a bounce on equities. That trendline has been tested overnight and might break down. If it does break down with any confidence then the case for a bounce on equities will strengthen considerably:
On DX, USD futures have now broken up far enough away from the support trendline that we could see a decent bounce on equities without DX having to break the support trendline. The short-term setup looks promising for some reversal on GBPUSD and EURUSD:
We might well see a holiday bounce here in my view. If it happens that bounce may well fail at the test of 1200, and bulls shouldn't get excited until and unless ZB breaks support, but that could well happen. If ZB holds support and ES fails here though then the setup will start to look extremely bleak over the next few days, so anyone playing a bounce here should be appropriately cautious.
Everyone have a great Thanksgiving. :-)
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