A.M. Update

Good morning.

While I'm definitely not giving China the attention it deserves, I hope you are following events in the worst month long sell off since 1992 with what was a fairly minor decline in the Shanghai Comp overnight of -1.2%, but that's because another 200 companies have halted trading since Monday, approximately 760 companies over the last week which is about 1/4 of all "A" shares on the Shanghai and Shenzhen exchanges or about $1.4 trillion in equity NOT trading, therefore NOT crashing.

Also today we are awaiting the numerous rumors, counter rumors and denials as Greek PM, Tsipras with a new Finance Minister whose name I can't spell, go sniffing for a deal with their perceived new capital and political mandate from the people, although I doubt the creditors care much.

As for the overnight session, my basic two scenarios for the market haven't changed much, both end with a bounce, whether there's a head fake in there or not is the only thing I feel some uncertainty about as I laid out last night.

Since yesterday's close ES/SPX futures have spent most of the night up, but moving sideways until just around the European open s a negative divergence set in and prices started coming down, not quite in line with European markets yet, but I suspect we see lower prices this morning. I'm looking for a break of the SPX $2055 level, that would set up a probable head fake scenario and likely a good area for short term long/bounce trades, although I always want to confirm there's accumulation in to any move down before going long.

This was the idea put out yesterday and covered extensively in the Daily Wrap.

Otherwise US and German bonds are bid in a flight to safety, while the rest of European bonds and stocks generally are on the downfall this morning.

Oil has seen some additional downside, nothing I'm worried about having missed after yesterday's price action.

One asset that might be getting interesting is gold so we'll take a closer look at that later today. For now lets see how the a.m. trade pans out and take this one step at a time before increasing risk size on long positions, then we'll deal with the next bridge when we get to it.