Wednesday -- It's Not Politics, It's FX

S&P E-mini Futures:
Down sharply, again.

News:
Red all over. And it's not Trump. It's FX.*

Spent more time studying yesterday's 'Burning Man for the 1%' -- what a treasure trove of social mood.

Some of my favorite verbage with the usual random comments and emphasis added:

The word unapologetic was used twice. It seems to be an apt description on the new tech-elite.

Alphabet's (Google) CEO Eric Schmidt describes festival goers as "the cream of the Burning Man crop." (only the best people)

“Unabashed luxury”

Nobu hosted a $250-a-seat dinner on the first night of the festival. (in the middle of the desert)

There was even an entourage concierge – “a personal, dedicated lifestyle manager and assistant ready to help you with any requirements or desires you may have. No request is ever unattainable.” (the Stones wrote a song about this. it's called Slave)

“Kiteboarding is the new golf.” (higher and higher)

"Justin Shaffer, an early Facebook employee and now an investor, says he wants Further Future to answer a new set of questions: 'What happens post-capitalism? Even post-democracy? What about post-employment, when we have universal basic income?'" (the future seems rather certain. note where the kid worked)

“We’re so privileged to come to these spiritual places – Further Future, Tulum – but not everyone can,” an audience member says, asking Piorkowski [the event promoter] how he should reconcile that.

“It’s all about balance. We are the ones meant to be the air, not the earth,” Piorkowski said.

These people, floating ever higher on the lofty social mood that propels them, are waaaay up in the air. So was Icarus.

FX:
*China devalued the yuan the most in 9 months last night.

JPY strengthened more than twice as much as any other major currency in the past week.

And commodities don't like that USD ripped nearly 1.5% from its recent lows.

Nothing to do with politics.

Treasuries:
Prices higher yet again, in defiance of recent Fed speak.

Energy:
WTI crude and NG bucking the strong-dollar-weak-commodity narrative, both higher.

Metals:
Metals down, dollar up. Enough said.

S&P Outlook:
Prices could test the 23.6% Fib retracement at 2040 with the 50dma currently at 2037.94 and the 200dma just below.

The market would have to strongly break below this important area for it to convince me that the rally from February's 1810.10 was over.