Looking Forward to Next Week

I think we saw a couple things today, an o-ex pin that was lower and the market quickly moved to that area and of course the 3C signals after 2 p.m. are of great interest to me because whatever price does Friday afternoon, it doesn't have a high correlation to how it starts the new week, the 3C signals pick up where they left off so if we have positive divergences this afternoon, the chances are VERY high that we'll have positive price activity early in the week (next).

There are positive divergences in all of the major averages (Dow, SPX, Russell 2000 and NASDAQ 100), my favorite is the IWM, my least favorite is the SPY which hasn't been able to put in a 5 min positive, whereas most everything else has and the IWM has gone further.

I'm not sold on an immediate move Monday morning, the reversal process in the averages to me looks incomplete, a pop higher immediately would look a little premature so I wouldn't be surprised if there was a little more lateral/sideways work done in the major averages, but that's an opinion, the most important thing for near term trade is there are positive divergences.

Also remember that no matter how far they may have reached, like the IWM out to 10 mins intraday today, it's still only 1 day of positive signals meaning it's a small base/foot print and the best analogy I have is if you put 1 gallon of gas in your car, don't expect to be driving across the state.

I still maintain a net short bias, I haven't let go of any short positions whatsoever and I look at today's positive activity as no more than a very brief, speculative move to the upside, perhaps it may have some head fake correlation as the market never put in anything resembling a normal, strong or convincing head fake move.

Other than that, I have a little more digging to do, as I said with any and all of the longs. THESE ARE SPECULATIVE. I think you could go with something as easy as a leveraged ETF like UWM (2x long IWM) or URTY (3x long IWM) or the same with the Q's, QLD or TQQQ if you prefer to stick with equity positions rather than options.

I'M GOING TO SEE WHAT ELSE MAY SHOW UP IN THE LAST FEW MINUTES OF TRADE THAT MAY BE OF INTEREST.

As I said, I'm still leaning VERY clearly net short, I'm not worried about a bounce, but if you can hitch hike a little ride and make some extra cheese, why not. The VXX/VIX futures are still KEY to timing our downside pivot.