Market Looking For A Bottom

However, it's not being easily found. You know what to look for in this case, a flameout, a surge in volume and a bullish candlestick showing lows didn't hold, that's not what we are seeing, instead we are seeing no flameout or capitulation and half hearted attempts to rally from a base that's entirely too small, especially with no selling/capitulation event.

 You know what we look for, the highest volume spike on some kind of bullish reversal candle to indicate a short term selling/capitulation event has occurred. The bullish candle, like a hammer has a long lower wick indicating that lower prices were tested and rejected, the surge in volume on that candle shows that all short term sellers actually sold,  this hasn't happened yet and rather we have a tight "U" price pattern that simply can't hold a bounce or rally, at least not for long.

This could become a black swan, very dangerous event considering Bloomberg terminals were down, market makers/specialists likely would have had little if any time to react and hedge, if those losses hold, things "could" snowball from here to prevent further losses. Neither SKEW nor VIX has shown that there has been much hedging protection, so this odd, fundamental event is exactly the kind of "Blow" to the market I have described in the past that could be enough to break the deteriorated market structure or in my analogy, the rotted pilings below the water line that hold up the pier over the ocean.

TICK hit an impressive extreme on the open of over -1700, one of the deepest sell-off readings in a while.

Note the uptrend that keeps trying, but keeps seeing price fall out of the channel.

The 3C charts seems to be showing an attempt to find a bottom here, but it hasn't been strong and in addition, the charts have deteriorated so badly, like I said last night, I don't think the charts beyond 1 min (which are very ugly) can be ignored much longer (1 of 4 signals I have been watching for as you probably are well aware).

 DIA 1 min trying to get something going, although FAR from impressive.

 SPY 1 min also trying, but again, far from impressive here.

QQQ 1 min.

The bigger issue is that the longer charts are responding intraday now rather than just a deep trend of distribution through the move since the 4/2 forecast for a triangle based breakout, which hasn't happened in the SPX as I've posted the last 2 nights as resistance keeps kicking in right at the March downtrend line.

However, although this is a fundamental event, a surprise to the markets, the reversal process is pretty darn close to large enough, as I also said yesterday, if not for the Monthly options expiration, I think we may have already been there and that I believe the top of the run has likely already been put in, this week was about the reversal process (although a head fake move just before a downside reversal has to be kept in mind as their probabilities are around 80% and the March downtrend line is CLEAR resistance , perfect for a head fake).

 QQQ 2 min also shown last night as acting well on an intraday basis, but deeply leading negative, even worse than this when scaled out.

QQQ 3 min's leading negative divegrence almost makes you wonder if the overnight events were somehow foreshadowed.

 The same is true of the SPY 3 mins

And look at the larger trend well beyond just this latest forecast move which is still within the 2015 chop, this is very ugly and at a new leading negative low for a chart that has proved remarkably accurate in the past as you can see.

Or the SPY 10 min chart's trend on a much longer/larger perspective, note the former divergences were right on and now we have the worst leading negative divegrence on the entire chart.

This is what I mean in saying, "These charts are getting VERY hard to ignore" in trying to pinpoint the near term pivot, it almost seems meaningless with this much large scale damage staring us in the face.

I'll continue to gather data, but I believe if we can get some kind of short term price relief, we need to get to acting in setting up trades.