Opening Indications / Short Term Opinion

Yesterday we saw several smaller positive intraday divergences get run over and 1 decent 5 min (IWM) positive get run-over, this tends to happen when there's more fear in the air and these smaller set-ups that are in their infancy are abandoned. This is a bearish change in character I've seen in 3C before.

From what I see as of the last two hours of yesterday, the market looks to be trying to set up a bounce again, I don't mean a big one, in fact I have a target in mind, if it can set up without being run over (which an op-ex pin might help), then we can decide if it's worth trading with some leverage, like calls or maybe a 3x leveraged ETF. This is a VERY short term view. I find it ironic that there are so many H&S tops at the top of their right shoulder and turning down just a little over 3-days away from the F_O_M_C in which its board members have come out in speeches declaring their concern about market "Frothiness", a lack of respect for risk and the sentiment that the market will just keep going up forever. Don't think Wall St. doesn't know what the F_E_D is up to or planning (which makes the distribution since 5/23 rather ominous). I've shown you the Home Builders being accumulated for a year and a half as the Tech bubble exploded, WHO WOULD HAVE EVER IMAGINED THAT AFTER THE TECH REVOLUTION, THE NEXT BULL MARKET WOULD BE SUSTAINED BY SOMETHING AS BORING AS HOUSING?

And don't forget the F_E_D "accidentally" emailing 154 Wall Street Hedge Funds and Private Equity firms the minutes from one of their meetings a day and a half in advance, not one of the companies brought this to anyone's attention as they were trading essentially inside information. Since when does the F_E_D have a mailing list when their data releases are supposed to be simultaneous so everyone receives the same information at the same time? Why would they send these firms that information in the first place even if it wasn't a day and a half ahead of the scheduled release? Point being, the F_E_D doesn't want another Lehman and a lot of firms like GS and JPM have helped them out in past crisis', I wouldn't be surprised at all if they (Wall St.) knew exactly what the F_O_M_C intends on doing next Wednesday, again making the distribution since the move above the range and at the top of right shoulders, OMINOUS.

In my experience, a bull market last about 5 years (consider the one ending in 2007, the 1995-2000 NASDAQ Tech bull and now we are at about 5 years (2009-2014), some would call it the "business cycle", but its entirely F_E_D controlled except when things go really wrong like 2007/2008.

The point of saying that was to say this, the vey short term "possibility" or view I have, wouldn't violate the right shoulder and wouldn't last beyond (if even to) next week's F_O_M_C.

 It looked to me at the time of capture that this 1 min chart of the SPY with a positive from yesterday was going to pullback and that's what would be needed (as I said in last night's Daily Wrap) to create a larger divergence capable of making a bounce move, since we have seen a decent portion of that pullback this morning thus far.

 The 2 min chart where there's some migration, but we'd need a bit more than this...

The 3 min chart would likely need to be positive as well which it's not. From the price-pattern, the implied target for the SPY would be about a point, around $195.25.

 On a 5 min chart which is very far from a positive divegrence, you can see that 1 point move would be insignificant, in fact it would be normal, that's how a pattern of lower highs/lower lows is created.

As for the right shoulder of the H&S top, look at the IWM...

$116.50 would be roughly the equivalent move in the IWM, it doesn't mess with the right shoulder at all, in fact it fills it out as I had imagined earlier in the week in this post, Opening Indications from Wednesday morning.

If I'm anywhere near correct, this would also give us a rough timeline to fill out some more positions and give us an idea of when some like AAPL/PCLN would be ready for an entry.