Last week, I had said that I am bearish on SPX & my medium term targets were already posted before that. Market came close to last low of 1200, but it failed to make double bottom pattern on medium term.

Before SPX started going down this WEEK, TNX was already making big bearish candles & JPY had already started showing bullish signs against Dollar as well as GBP, EUR & AUD. So, it was a very clear signal that drop on SPX was coming. I told many of you on Wednesday about it.

I'll post update on charts once market close today & after I get all volume & open interest detail.

From now on I am not gonna do biweekly analysis of market like usual, only weekly analysis. I am getting none to very little feedback. So if you interested in daily or biweekly analysis, email me. I'll respond it.

Later u all....

As you notice here, TNX & USDJPY are currently strongly bearish. So I wouldn't call SPX rally bullish. I am still bearish on SPX. I am not expecting it to break above 1300 anytime soon until TNX & JPY reverses.

SPX
USD/JPY
TNX- 10 Year TreasuryI was comparing Bond yields the other day to see how it can reflect SPX. Short Term yields are stable compare to 10 year & 30 year returns. It is not a good scenario for SPX when all yields are moving closely. You can compare that by going

TYX - 30 Year TreasuryFYX- 5 Year TreasuryIRX- 13 Weeks Treasury Bill

10 Year Treasury Note has failed to maintain its bullishness on daily time frame. That means bearish SPX & bearish USD/JPY. US Dollar is extreme over bought in short term & Gold is over sold with Crude Oil. I am watching AUD very closely for Gold. If RBA lowers interest rate despite of higher inflation in Australia, it'll effect Gold price uniquely. We'll see how much AUD goes off the correlation with Gold then.

SPX has made false break out speaking from Rising Wedge Pattern. Now, it is more clearer by looking at TNX charts that it's continue bearish trend since doji has failed to reverse trend as I had mentioned in August 10th post. I have already posted my bearish target levels for SPX in that post.

On the other hand, JPY has gained sharply today against US Dollar as well as EUR, GBP & AUD. I am bearish on USD/JPY as many of you know. I posted detailed chart analysis of USD/JPY on August 7th. I still stand for that. :) Below here is the current chart of USD/JPY(daily). As you can see there is some Rising Wedge Pattern here as well. If rising wedge pattern analysis is true, then big drop is coming soon on both SPX & USD/JPY, but for that TNX has to break downward current trend as well. So, keep watching all three. Happy Trading......

In this SPX chart, we are seeing main bearish trend, but it's going for small correction. 1290(tripple top) is major level to break upward. I am watching small triangle pattern very closely, because it can break any side. To look @ bull or bear sentiment for SPX, I would look @ TNX & USDJPY. Follow TNX & USDJPY chart below.

In post of August 5th this week, I had mentioned that TNX will test 41 atleast, if not higher. In past two days it did. It is also sitting on important level of making or breaking. TNX analysis is very important for SPX & JPY traders. They all go in same direction with above 85% correlation.
There is a medium term bearish thick blue line trend & dotted long term bullish trend. If it breaks below, then SPX is surely going down. Reversal is also true as well. Keep watching......

USD/JPY... This is very interesting chart of all to me. Current price level is sitting at two important trend line crossover. Despite of today evening's big fall in EUR, AUD & CHF, JPY hasn't dropped that much @ all. SPX & NIKKEI were down and same time EUR & CHF were bearish too. Therefore it made USDJPY more sideways then bullish. With further fall of SPX & 10 year Treasury Yield, USD/JPY will be bearish.

The reason I put USDCHF here is because of it's very strong correlation to JPY & TNX. As you see here, it's also sitting at very important level of break or reverse.

CONCLUSION:
Very important to watch market tmrw or next week. Stay alert....

I'll be placing more JPY trades next week based on this analysis for Carry or non-carry.

TNX main long term daily trend is currently bullish. Sub Trend- thick blue line is bearish, but currently has reversed after touch main trend- dotted blue line. This is a strong indication that TNX will at least test 41, if not higher. That is a surely bull news till TNX finishes it's correction to 41.
So, what about JPY? In this chart of USD/JPY below we are seeing that it wants to break current level upward, but it's not have been able to so far. Since, we can't tell for sure right now that USD/JPY will break upward or not even though SPX & TNX are bullish, let's bring other important thing which has 96% correlation JPY: USD/CHF.This is the chart of USD/CHF. Right now, it's holding very important level on appx 1.0550. You can see long term daily Black trendline as well as key resistance levels. It'll be a major US Dollar bull break through if USDCHF breaks this level upward. So, far there is no way by looking @ US fundamentals that it'll break upward.
In conclusion, I'll say that USDJPY will be side ways despite of rise in TNX & SPX. Sure, there will be small rise on USDJPY, but not a huge break for Carry Trade.