Most of you know by now what intraday capitulation looks like, a short term selling event that marks a short term bottom, typically on an intraday 1 day basis.
I suspect we are coming up on the heels of such an event now. This doesn't seem to reflect anything other than an intraday short term oversold condition. Using the SPY as a proxy for the market...
The 2 min SPY 3C chart is nearly perfectly in line so I
don't see any short term accumulation of any importance.
The one thing I've said several times the last 2-days is my greatest fear (
which is not actually a fear as I've built my core /trend short positions and any downside will just put them in the green), is the market collapsing BEFORE we can add additional short set ups such as the few I've put out Trade set-ups for like NFLX and Transports specifically. If possible, I want to give those who'd like it, the best opportunity to set up core /trend positions (mostly short) before the market breaks which I'm certain of.
The SPY 3 min chart is also in line , confirming the downside trend with a negative divergence/distribution at recent highs in this horribly tight, low volatility range.
SPY 15 min which is a much stronger timeframe is now at a new leading negative low after distribution at the highs on this chart.
The 60 min is leading negative and worst of all for the market on a big picture basis...
The Daily SPY chart (strongest divergence) is leading negative in a huge way.
I'm not a fool and I don't expect the market won't try to shakeout shorts before any major break as it has already done once very poorly, I'm just not sure the market has anything left with even the turn to lever of short term manipulation, HYG, breaking down.
The VIX futures intraday chart however show an intraday negative divergence suggesting the market is looking for an intraday bottom/short term oversold condition.
The 1 min (weakest) SPY chart is as well...
From leading negative at yesterday afternoon leading to the concept of 3C picking up where it left off with a gap down today to a slight positive intraday divergence on the 1 min chart only.
The TICK/intraday breadth data suggests the same.
The NYSE TICK trends, note the lower range extreme hit just about 1:15 pm EDT.
My custom TICK indicator is also showing a deep extreme in TICK that is starting to improve.
As you know, we look for an intraday candle with high volume and a positive candle, such as this in SPY 15 min...
See the candle with the longer lower wick on the highest volume of the day, I believe that was our intraday low just in case anyone is day trading, but remember we don't have anything even approaching a positive divgerence after the 1 min chart- 2 min above is in line with the downside today.
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