First futures gave no support, in fact the opposite, then last night they were nearly perfectly in line and today or tonight, they are supportive. If I were to put the above sentence in to candle stick vernacular or represent it with a candlestick chart, it would be a long negative candle down, a star or Doji representing the stalling of the downtrend and a confirmation reversal upside candle.
Take a look...
ES 5 min clearly positive, maintaining momentum in to the overnight session
NQ was positive on the 1 min which was a huge improvement for the NASDAQ as it has been the WORST looking average BY FAR for the last week. NOW we have a 5 min positive divegrence showing up and out of a bear pennant which is like a bear flag, the perfect head fake price pattern.
TF-Russell 2k Futures are the strongest (5 min) as they should be, the R2K should lead all risk on moves/rallies.
Even the 30 min chart is now going positive, actually this started last week and picked up momentum last Friday.
Just as a reminder though of the big picture, this is the R2K Futes daily, this is as clear as you get, the path of least resistance is DOWN, but nothing moves straight up or down, thus the 5-30 min positives.
However, with this knowledge, you should be planning on how you want to use any market strength in the near future.
Having decent overnight market activity can be helpful for a bounce, the Nikkei is looking a lot better in the near term.
Nikkei 225 futures with a 15 min positive and what looks like a rounding bottom or reversal process.
Interestingly, the VAMPIRE SQUID, better known as Goldman Sachs who trades against their own clients, is out with some free advice from Mr. Stoppler, which is an ironic name because the last 6 or 7 trade recommendations he's put out have been "Stop-plerred" out.
Today GS and the Stop man put out some FREE trading advice and rec'd:
"We recommend going short $/JPY at current levels of about 97.30 for a tactical target of 94.00, with a stop on a close above 98.80."
Short the USD/JPY huh? Free advice from Goldman huh? Other than the fact the trade is a 2:1 risk/reward ratio, WELL BELOW the minimum of 3:1 any decent trader would consider to be the bare minimum, the fact is GS fully expects this trade to be stopped out because they don't spend millions on research to give you their trade ideas and have you competing and taking away their edge and profit, they aren't a charity.
This simply means, GS is buying $USD/JPY, they aren't dumb, that means a risk on currency pair should be seeing upside action and that's helpful to the market, but what does 3C show?
15 min Yen futures look a little negative...
15 min $USDX futures look VERY positive, so despite their recommendation, it looks like the USD/JPY pair is set to gain, stopping out those taking advantage of Goldman's generosity and making GS money as well as providing a risk on carry pair a potential engine for higher market prices!
Finally the SPY...
Daily candles show a pack of them in a range with a Doji at the end, then at 2 a Star (bullish reversal candle) on increasing volume makes good and reverses to the upside the next day. We have a Hammer-like candle today, not a perfect hammer, but lower prices were rejected on increasing volume, it's not a technical reversal candle, but the trading action is the same despite the definition not being exact.
And on a 60 min chart, what do you see? A Reversal process? At this point it's a bit larger than I expected so maybe we do get a move to the upside just a tad stronger than expected and there are so many shorts out there that just need that little push.
Take a look at the daily TF/R2K futures above again and think about that, then think about a weak underlying move to the upside, if that doesn't say market gift to you, then watch what we do with it and next time you are presented with a similar situation, you'll have the confidence to take advantage of a deceiving price move that leads to beautiful set ups with low risk and a HELL of a lot better risk:reward ratios of 3:1, more like an average of 8:1 or more.
Just like I have been saying, "We are too close for Wall St. not to take advantage of this" and since we are taking our cues from those running the game, we take advantage too.
Tonight's post was almost about all fo the great looking shorts, but lets just get to where we need to be, LET THE TRADE COME TO US and there will be plenty for everyone.
Here's one of my new favorites.
5-day TSLA chart. Parabolic moves remind me of the saying,
"The bigger they are, the harder they fall"
60 min 3C, notice any changes?
The short term is offering a gift on this 3 min chart, you see what it is?
My Trend Channel performed beautifully, that jog in the middle didn't close below the lower channel line so no stop, but now, we are VERY close. $169.50 on a 2-day chart is where the character changes enough to change the trend.
There are Hundreds more even better than this.
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