The Week Ahead

Early this week upon expecting a bounce in the IWM, I had switched over to URTY for a single day and gained over 3.5% on a larger core position and closed it after that day and went back to SRTY which was the core position I've been holding (it was closed at about a 9% gain to enter URTY). As you know, after seeing the initial weakness I closed URTY early this week and went back to SRTY which was lucky as that day had been the largest move in the IWM for the week and the SRTY position I added back is already and has been green since I switched back.

Last week we had a clear positive divegrence, not huge, but enough to expect a bounce, other than everything else that has happened this week and continues to develop, I'm focussing on what we have seen this week and what that is likely to lead to next week. My opinion is other than maybe some minor noise, the trend should move down, this will be reestablishing the preceding down trend in the Russell 2000 that has been in effect since just after July 1st as Window dressing for Q2 ended.

I'll use the SPY as an example...

 The 2 min trend for the week has been clear and constant distribution

 The 5 min chart shows the same thing for the entire week, I don't see any hint of a positive divegrence that would even be able to lift the market next week in even the shortest timeframes, there is the gap so maybe there's some noise, but it's the trend I'm interested in.

 10 min chart clearly leading negative.

The 15 min chart leading negative

The same for the 30 min chart, this is migration of a divergence unlike IYT.

And all the way our to a 60 min chart so the bounce we expected to see this week, I also expected to see it distributed and create a counter trend or correction in the IWM's downtrend off the right shoulder highs, we have seen. I am looking for a move lower next week.