Futures

I can't look too far in to futures until they develop a little more on longer timeframes (which so far continue to deteriorate as expected), but not surprisingly, despite the fundamental news flow, here's what occurred in ES (S&P Futures) which had seen about a 9 point slide overnight from the start of opening trade this week last night.

 The green arrow on the ES 1 min chart is the European open, the large white arrow is an intraday positive divergence pre-market and the smaller white arrow is approx. 8 a.m. EDT when the EUR/USD lifted higher as expected late last week and specifically Friday as shown in this post near the end of day, expecting the Euro to lift higher near term. This move in the Euro, as explained in the linked post and many others, is market positive in the near term or timeframe it is occurring in, as you can see, ES anticipated the move higher in the EUR/USD as it put in its own positive divergence in the early hours this morning pre-market.

 This is the EUR/USD since FX trade opened for the week last night, it was very flat until early this morning, pre-market when it lifted and taking ES with it, despite some ugly news flow that included Japanese GDP making a second consecutive sub zero print, which puts Japan back in recession, Monti's Italian government coalition also is in a state of collapse, there were other events, but all pretty much negative.

 A close-up of the EUR/USD 5 min chart today... So why the pop in the EUR/USD and ES?

I still believe it is technical in nature as this IWM 60 min chart shows, this trading range is too obvious, there's too much money to be left on the table by not running the stops and orders above the range.

Again, the longer term Futures charts as of now continue to deteriorate which is what I was hoping to see last week, in essence showing us a false move with short term price strength with an obvious target with price patterns like this, but the longer term charts falling apart as witnessed last week, at least later in the week. You may recall it was late Tuesday afternoon the the 5 and 15 min futures charts turned bullish quickly, telling us something was going on in the near term, those same charts have now turned bearish in underlying trade so we have more or less picked up right where we left off Friday.