Market / Futures Update- Russell 2000 False Breakout Attempt Likely

First the averages...

 SPY 1 min showing distribution through today's earlier price gains and since, lateral trade or range bound-often where distribution is heaviest in what "seems" like dull price action. However if you think about how market makers and specialists are graded by institutional investors they fill orders for, it's often by use of VWAP and where the average fill is relative to VWAP, so often holding price at a range like this rather than letting it fall (through small changes in supply and demand via the market maker as well as changes in the bid/ask) allows them to get the best fill for institutional clients ensuring they get more business from them in the future as this is one of the roles Market makers (NASDAQ) and specialists (NYSE) fill.

SPY 3 min shows the negative in to this week from late last week resulting in lower prices Monday and Tuesday on the open. At #1 Tuesday's positive divegrence, likely to get market makers and specialists out of losses (due to inventory held at higher levels) on the probable surprise Chinese tightening move .

Distribution at #2 sending prices lower yesterday and at $3, accumulation and the "W" price pattern with the second low having hit stops below the first as was expected in commentary early yesterday regarding double bottoms and smaller "W" bottoms.

At #4 a relative negative divegrence at today's momentum highs as the market lost upside momentum and turned lateral with deepening leading negative divergences through the range this afternoon at #5.

SPY 5min, the same "W" pattern with a weaker relative positive at the second "W" bottom lows and a weaker 3C signal as compared to the highs of the 9th.

 QQQ 1 min also showing the same distribution through the range this afternoon as early momentum gave out to a lateral range.

QQQ 5 min, also seeing a leading negative through this afternoon's range, but not quite the negative needed yet to call an end to this particular move (up) today.

IWM 1 min looks to be in line, ther may be a reason for this...

The larger topping pattern in IWM daily chart, similar to a large complex H&S top.

Using the concept of where we will short H&S tops and where we will not along with the head fake moves now endemic among H&S tops... I'll short the head #1, the right shoulder/s #2 although I may be short during the break of the neckline and may take profits , unlike what Technical Analysis has taught for nearly a century, I'll NEVER short the first break of a H&S top's neckline as this is where new shorts enter and are routinely shaken out with a move back above the neckline where they place their stops so the 3rd and last place I'll short a H&S top is at the volatility shakeout of new shorts after the neckline has been broken at #3.

However if you look close, there's a VERY obvious range in the IWM, to set a bull trap, traders need a reason to but and most will buy on confirmation / breakout above the range.

Looking at a 30 min IWM chart to see the range better...

 Note the October rally momentum dies in November. From 10/31 to present, the IWM has moved exactly +0.10%, a flat range with no gains. This is over a month of trading , actually close to 6 trading weeks in which the IWM has been locked in a range.

Typically before a reversal (to the downside in this case), if there's an obvious range / resistance area, or some sort of technical aspect like a 50-200 day moving average, these will almost always see a false break out/ head fake move which is the last thing to happen before a downside move, just like the September head fake move from the August rally's stage 3 top, that failed breakout/ head fake move led to the loss of 1200 Dow points in 2 weeks and led to the October lows.

This looks like a probable target and move, making SRTY long or IWM short a very attractive entry on a break above the range which is sure to fail. This is why I believe the IWM looks better in intraday 3C trade than the other averages. I believe it is targeting a head fake/ false break out above a nearly 6 trading week range. How else can you entice longs to buy and create the bull trap that is so effective in creating downside momentum (again see the September head fake/false breakout and the downside momentum just after, as the market had been in a long range after the August rally lost momentum.

Futures

 ES 1 min with the same negative divegrence through the afternoon range, now failing as warned earlier today, Quick Market Update

 TF/R2K closer to inline, but also seeing downside.

 NQ 1 min perhaps looking the worst with distribution through all of its gains today

 TF 5 min showing more distribution than the shorter term 1 min

ES 5 min as well

The ES 7 min trend shows 3C confirmation all the way down, although there are small divergences like today's the trend itself remains very negative for the market.