Confuson Growing

We've entered the part of the bear market where confusion begins creeping in. Did the Bank of Japan intervene again or was that the market? Are central banks secretly intervening as the did in 2016? True or not, this signals the market now belongs to the central bankers. If the yen rallies, the BoJ rises in stature. If the yen falls, the BoJ has failed. Some bears are now wondering if central banks will destroy them again as in prior bottoming attempts and bulls must now worry that the yen starts trading more like the Thai Baht in 1997 than a G7 currency.

My advice: it's a binary event. Either it happens or not and there's nothing we can do about it. The market is already down a large amount this year so pressing shorts isn't advisable. Conversely, the bounce we have seen since the bounce from 3500 is a good spot for opening new shorts. I am stalking energy again, gold, and looking at individual targets such as DPZ.

USDCNY moved to a new high today and is tracking with the yen. USDCNH is up 1.2 percent, gold failed at resistance, U.S. long bonds are following through on their bounce from last week and Hong Kong cratered 6 percent overnight.

With Chinese yuan pounded and Hong Kong down overnight, iShares MSCI Emerging Markets (EEM) is down more than 3 percent in premarket and below it's long-term support line.