A 'manic trading week'  brought preceding warned-about complacency to an abrupt end; as the S&P probed above the 3000 level on a projected relief rally (rebound in the wake of the Fed chaos flush); before resuming decline in the manner outlined (the idea of fading rebounds, not selling weakness).  

Today's better relationship with the EU (minor as it may be), is signaling that the United States seriously seeks better trade relationships, especially while embroiled in fights pending new tariffs on China.   

Having extensively outlined how the Fed and China would play into the S&P behavior this week, for the weekend let's just identify the S&P key technical levels, and update a few points:

• S&P briefly took-out the 50-Day Moving Average, consolidated and then stabilized a bit; with all this confirming our admonition of July's first-half being an opportunity to distribute or sell portions; preparing for declines;

• The intraweek idea of waiting for a rebound after the Fed circus, was for sure on-the-mark, as we targeted a bounce to just over S&P 3000; with little more as it was a short-squeeze preparatory to another leg down;

• Major headwinds from 'trade issues' do exist, but are exaggerated to at least some degree, since many manufacturers have already shifted lots of production from China to other countries;

• The foregoing shift will prevail so long as China remains unwilling to (as reports have it) follow-through with verbal commitments on trade; hence this isn't ever going back to 'only' China; but should prod an agreement;

• Alternative of a bipolar trade war (I prefer competition) is real of course; and probably occurs to a degree regardless (especially when it comes to electronics and products like EV and also AI / AR);

• Oil has been defensive mostly because gasoline demand has dropped a good bit; not because of the Saudi's pushing more oil sales to China;

• In fact, the U.S. is not so desirous of Saudi oil; hence it's irrelevant to a degree; while the US would like to increase oil and LNG sales to China, and the lack of bigger agreements there may be part of the tension;

• Aside the palpable downside (especially in the pricey tech / FAANG+ stocks), we continue our forecast for corrections but not catastrophe;

• Yes the macro-Debt issues are a concern; but they're not an imminent threat to the S&P; in fact it's deflationary tendencies that are worrisome;

• This is why the 'Death Jaws' 10 year Treasury / S&P spread matters; but it's persisted for quite awhile and while awareness is important, it alone is not going to be the determinant of future action; but is a warning;

• Meanwhile, the market should see a rebound attempt next week; though not to higher highs, and within context of outlined near-term rollovers. 

In sum: the generally outlined overall pattern forecast unfolds; and the daily swings were wild, definitely impacted by news; but even those conformed to the ebb-and-flow expectations.  

The 'framework' we'd like to see is incoming economic data continuing what has been outlined slippage over about a year-and-a-half (contrary to popular perceptions of 'strongest growth ever', which was not at all the case aside a few of the leading stocks), continuing into the Fall, but no much beyond.

Recall my macro forecast has been for the downside to near an end about the time they proclaim an 'official' recession; with nuances present since I'd first outlined that (actually at the NY Trader Expo talk) in March of 2018. As you know that followed by belief that broad market internals topped in late January (forecast that break as we got a blow-off spike); and eventually the secondary high in September. And then the December low.

That matters, because 'if' the politicians and Chinese don't mess things up; this latest projected series of corrective rolling declines might well 'trough' in an intermediate-duration way, concluding downside (or nearly so) around the time I return from this year's Berlin exposition (bigger on EV vehicles by the way, than last year's focus; as Germany pushes EV versus ICE cars).  

In a sense this could be the opposite of last year for the S&P: instead of 'a' top as Fall begins (that was a dragged-out Summer of 2018 range); for now it looks like 2019 might see a washout low (stay-tuned for the timing) as we go forward; while obviously interspersed by news-related swings.