The SPX pattern left itself open for a final surge by the ned of the day by not breaking support at 2020.41 and the algos took it from there with Fed Governor Charlie Evans’ comments last night. This was based on the unexpected collapse of the 10-year yields, raising risk premia in stocks as well as commodities.

BLS reports, initial unemployment claims missed expectations on a seasonally adjusted basis and surged to 407k on an unadjusted basis.

Meanwhile, the expectations on the street are that the decline has done its job, “So, let’s get on with the rally!”

The Premarket is due to challenge the 50-day Moving Average, as noted earlier. The challenge should not last beyond 10:00 am. This sets back the clock for the decline to last 4.3 days. Most likely the bottom may arrive on Wednesday, January 14, by noon.

Meanwhile, TNX has traced down only Wave [i] and [ii] of C. It has a target for Wave [iii] of C at 15.00. This is what Charlie Evans is very fearful of, since it means that the risk of a market decline is growing exponentially.

Respectfully,

Tony

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