Daily Wrap & AAPL Re-Visit

Since our AAPL post from April 2nd in which it acted as a proxy fro the broad market, IMPORTANT: AAPL Set-up & Market Movement , we are already seeing what I'd consider to be important signals in AAPL.are they screaming right now? I'd say "No", but are they moving in that direction? I'd say yes.

Remember AAPL reports April 27th after the close so they have a bit to go.

Some of the signals you'll see on a shorter term basis, seem to line up perfectly with anticipation and hope over the Apple Watch out last Friday. Otherwise, we have some significant movement , which is where the April 2nd Forecast really started more or less.

 After having gone through my watchlist April 2nd and having seen so many triangle based price patterns and those in the broad market, it all started to make some sense, a volatility pinch like Bollinger bands creating an upside breakout that was expected since before the breakout to see distribution based on a number of factors. The same 3 main things I'm looking for are still in play, however after looking at more and more charts, they are falling in line the same was as the broad market.

AAPL's triangle is too large to be a consolidation/continuation triangle as are most of the other ones in the market except maybe the Spot VIX which I suggested Friday was in a coiling of tension and a Crazy Ivan shakeout which we'll look at below.

Volume is also totally wrong for a triangle breakout as it continues to decline in AAPL, the reason I used it was because it had one of the cleanest triangles and I just happened to be at AAPL when I saw the patterns were overwhelmingly repeating warning of last week's upside move.

Look at the 4/2 warning and what AAPL did the next day, since then, AAPL hasn't closed above last Monday's initial breakout attempt, there has been no follow through, no volume.

 I think the 6 hour AAPL chart speaks for itself with the triangle in the yellow box, which is one of the trends and reasons I said in April 2nd's forecast that I expected the triangle breakouts to be under distribution, as such false or failed head fake moves which we often see just before a major trend reversal.

The 60 min chart shows the AAPL "W" base that saw its second half form on April 1st, since and in to this morning's opening highs on a Doji Star, there's a very clear negative divgerence on an important timeframe after this base/forecast started.

 The 30 min chart should show a stronger, more detailed divegrence as it does, including the "W" base just prior to the April 2nd market forecast.

 The 15 min chart shows the same so we have multiple timeframe confirmation which was already being forecasted by the longer term AAPL charts before April 2nd.

Starting from the very short 1 min chart, you can see a lot of detail in to forming the "W" base area as well as keeping the triangle's shape intact, even at distribution to the left in between the "W" at the high of the 'W'. Also note some accumulation just before the AAPL watch order debut on April 10th, last Friday, it seems there's some disappointment looking at the divegrence to the right of that (last 2 days).

 Next AAPL's 3 min chart, again more detailed and numerous divergences all marked (positive and negative) and again just before the watch release, a positive and then nothing to really follow up as today's signal is negative.

And a closer look with a stronger 5 min chart, again accumulation just before the watch release/buy/order date of 4/10 and today's leading negative in to the open.

On the day,  the market acted exactly as forecasted for the start of the week with 1 min positive divegrence in to Friday's close suggesting strength, but nothing positive in the 2-3 min range just after which is why I suspected initial strength on the open followed by weakness which was quite spectacular as a forecast today.

While I still don't think this is absolutely over, remember the reversal process which it many ways it seems we started today, but a number of signals went south as expecting including 15 min Index charts, Yields across the curve as of the open so it wasn't Greece and their possible default/Exit which came out around 1 pm, as yields led the market lower since the open.

The Dow lost 18k, the SPX lost 2100 and the NASDAQ lost 5k, all psychological levels.

As I have suggested the last several market days and late last week, I suspect the VIX (spot) has being in a triangle (smaller) coiling energy and I suspected we saw the first half of a Crazy Ivan shakeout late last week as the VIX sits just below its 50-day moving average. Today it was up over 11% and making a stronger case for a Crazy Ivan shakeout as posted Friday in the Daily Wrap, this is to shakeout both sides of a well known price pattern in an important or closely watched asset.

Daily spot VIX which was WAY outperforming its correlation as posted earlier today with a small leading indicators update here, Talk of a Greek Exit Adding Pressure Note VIX is just about crossing its triangle's apex or completing a Crazy Ivan shakeout (both sides of the triangle-a head fake move.)

Apparently protection is bid now unlike April 2nd strangely in front of the jobs report on a 3-day weekend.

As for the charts, they were mostly in line in to the close, looking a lot like they'd continue lower on tomorrow's cash open. As for the 15 min charts, today was the first day the SPY 15 min moved out of perfect correlation/confirmation, the others look quite worse.

 DIA 15

QQQ 15

IWM 15

SPY 15 starting to lead negative for the first time since 4/2.

HYG's 3C charts are falling apart badly as well, so that should be interesting over the coming day/s.

Our SPX:RUT ratio was one of the few indicators suggesting the market find a toehold rather than just decline straight from here.

Interestingly, just like NFLX left a very bearish daily candle on the close,  most of the averages left a candle that would be very interesting as a reversal if it were to see a bearish engulfing candle as confirmation, as well as giving some great opening entries. Even beyond that, you'll see they don't look good in the trend since the April 2nd forecast.

*All red candles drew in by myself represent bearish engulfing candles, opening at the day's high like today, closing below today's real-body .

 The Dow which looks a lot like a flag and this would make for an excellent head fake and confirmation at the close.

The Russell with a Shooting Star-like bearish reversal candle today.

The NDX with a Star-like closing candle.

And the NASDAQ Composite with a Star-like bearish reversal candle. These are the type of candles I drew in last week as an example of how I expected this particular move would end.

One of our two Pro sentiment Leading Indicators suggests the draw in candlestick for tomorrow is a possibility and we have short term intraday support being signaled by our SPX:RUT Ratio indicator.

Otherwise Leading Indicators (1 of 3 conditions) are deteriorating s are the other 2 right on track. Yields, commodities and HY Credit are among the others leading negative as hoped we'd see.

The 15 min Index futures charts I was looking for to turn... As you can see, PATIENCE PAYS...

 ES 15 min

TF 15 min

NQ 15 min

And don't forget, the highest probability chart...

ES/SPX futures 60 min in an ugly leading negative divegrence, timing has been the only real question.


INTERESTINGLY THE $USD WAS ALMOST UNCHANGED ON THE DAY, SOMETHING I WROTE ABOUT IN THE A.M. UPDATE this morning and the feeling I get that it's not only related, but has much broader implications. All of the overnight gains in $USD were wiped out as the near term 3C charts have been telling us after we saw a bounce which we have.

 $USDX 60 min including the reason I suspected we get a near term bounce and after that a larger move to the downside, this has significant implications on the carry trade.

As you can see, it looks as if the $USD is going negative off that initial positive (bounce) divegrence.

 The 1-day chart shows the larger negative as my forecast on 4/2 was for a near term $USD bounce followed by a larger move to the downside.

And the 5 min chart is clearly negative looking like the $USD's bounce is ending and the next move to the downside should start.

The closest thing to a Dominant Price/Volume Relationship was "Close Down/Volume Down", which has the least bias which is why I nick-named it, "Carry on" as in price keep doing what it was doing, which we saw last week and had a second flat day within or nearly within the first day's range, although it was hardly dominant, 58 of the NASDAQ 100, 214 of the SPX 500 with the Dow and R2K having no relationship.

As for sectors, only Financials closed green (I suspect as we have a lot of Financials reporting this week)  with 8 of 9 in the red with Energy lagging at -1$ and Financials up +0.37%. If anything we are closer to a 1-day oversold condition although I'd hardly call it that, just an overall ugly day for the market losing this morning's price strength.

In similar fashion only 52 of 238 Morningstar groups closed in the green, again I doubt very much it's a 1-day oversold condition, but I suspect the effects will be similar,

There are some other indicators that haven't been updated yet I need to check on and will let you know if they hold anything of interest, but so far it looks like we are on track from last Friday's The Week Ahead post.

Although I'd be surprised if the market just rolled over so easily without some kind of shakeout as I suggested above on the daily charts with a bearish Harami, I think the gist of the timing and result of the forecast for this week are on track, which should guess some very interesting positions, likely tomorrow I'd suspect.

I don't want to start high fiving and underestimate the market based on the ugly price action today, however for us it was more about the signals in the averages, Leading Indicators and the Index futures, not the red close. But as I said, the market shouldn't be underestimated as Wall St. makes their living by making the most number of people wrong at any given time, I just feel very good about what we have been looking for and what has transpired.

Right now Index futures have an intraday positive divegrence, perhaps I'm a bit too bent on wishful thinking, but perhaps it could lead to the gap up opening we'd need for a bearish Harami reversal confirmation candle 

NQ/NDX futures 1 min is representative of Index futures right now going in to the overnight session, although the 5 min charts are negative so normally I wouldn't expect this to hold the overnight session.



I'll check on futures before turning in and post if there's anything of excitement, but for the moment I think patience is still required, although I think we have now just about met all 3 indications I have been looking for.