Interesting Inflection Points Today

This is today's 1 min chart. The first area of interest was the opening gap, which showed immediate distribution (first red arrow). Then a zone of accumulation at the white arrow, did little more then slow the downtrend. The 2nd red arrow from the left showed a large leading negative divergence, the 3rd red arrow shows a relative divergence, but the longer 2nd red arrow shows where the real damage was being done. It seems there was an effort to unload at obviously higher prices during that 1 hour+ period. The rest is self evident.

End result, about  1% GAP HEAD START nearly totally erased.

Something's Going on

I can't pretend to understand why or who, but there's a major sell-off in bonds right now in some coordinated effort. Maybe a foreign government, China? I don't know, but it's UGLY. I'll look into more, for now take a look at ZH chart

http://www.zerohedge.com/article/tyz-bloodbath-commencing-543

TMV

At a 7.5% gain in TMV right now and it declining, you may want to take some profits of the table.

Tick Chart

Something just upset a broad spectrum of stocks in the market, the Tick Index shows at any particular tick how many stocks in the NYSE are up minus those that are down. I just saw a pretty extreme reading.

 1 min chart around negative -1500 which you can see doesn't happen too often

Here's a longer 10 min chart, there's only 1 other instance at that low on 11/29

SPY Update

 1 min

 5 min

15 min

UNG Request

 5 min

 15 min

 30 min

60 min

Chart Request

 DIA 15

 DJ-30 15

 FAZ 15

 IWM 15

 QQQQ 15

 SPY 15

SPY Daily

TMV puts in another decent gain

Our long in TMV (Inverse the 20 year bond-short) has put in another nice gain today after bouncing off support + 6.5+% today

For shorter term traders, watch resistance coming up around $45, for longer term traders, you may want to establish a trailing stop. If you need any help with the Trend Channel or an alternative stop, email me.

FXE Update-Request

FXE 1 min-the divergence has just made it to the 5 min chart, considering there hasn't been a price move, I'd anticipate there may be a bounce being accumulated now. Again though, the 10 min chart still looks bad and the 1-5 will have to strengthen to move into the more substantial 10 min timeframe. As of now, it just looks like a probable intraday bounce.

Update

This is the first sign of a reversal since the move up around 12 p.m.-SPY 1 min

MMM Update

If you like the MMM short trade, it has just hit a gap level, gaps often provide good support/resistance which means a bounce here can offer a better entry.

 1 min showing a positive divergence (bounce) around gap support.

The hourly chart however, shows MMM in a long divergence on a 60 min chart, a decent bounce would lessen the risk of a short position.

Chart Request for FXE

We have the Irish Bailout Vote today.

Here's FXE's charts.

 1 min Distribution right into the opening gap , there's a small patch of accumulation recently, that;s the move that's happening now as I type this (12:34)

 5 min shows the accumulation that at least sent the trend lateral for over an hour.

 10 min again showing pretty heavy distribution right into the opening gap, sending prices lower
This is also in a leading negative divergence.

15 min again, more confirmation of the distribution on the open, there's another slightly less strong leading negative divergence on this chart as it's longer.

Basically if the 1-5 minute charts don't start going very positive and flow into the longer charts which carry more weight, then it's not looking very good at this point.

RBS Trade

RBS is a high probability/low risk trade here.

 RBS 5 min

 RBS 15 shows a short period of accumulation for a bounce and it is now very negative

 RBS 15 confirming

 60 min

 1 day actually looks worse then appears, it's not only confirming, but negative as well.

The downtrend is unbroken and nearly 2.5 months long.

The stop I have depicted is at the red trendline.

Here's an example of a position with a $10k account @ 2% risk.

Assumed entry= $13.00

Stop= $13.60

Risk per share= $.60 (initially-it can move down to less risk in the trend channel once it moves down)
2% of portfolio (risk money=$200)

$200 (2% of $10k) / risk per share $.60=333 shares

Total purchase= $4329 which is too much risk -nearly half of the portfolio, but illustrates the lower risk profile of the trade.

In this case, to protect against gaps, with a $10k portfolio, I'd personally take on between 100-150 shares, which leaves your exposed risk (less unpredictable gaps) at $60-$90 risk on the trade, plus commission or about a half to 1 % of portfolio.

USO update

Of course these triangles are often manipulated, but as a consolidation pattern, the volume is very high.

Watch for some volatility around this pattern, up and down, but the ultimate move above or below will be very indicative of other signs we are seeing in 3C

MMM

Recently on the Trade list on a limit order looks really bad this a.m.

AS MM failed to make a higher high on the bounce, it is still in a technical downtrend which seems to be resuming today.

Early Update

This is early for an update with timeframes this long, but they have moved so I'm including them.

 SPY 1 showing a short term bounce probability, but overall the gap showed a negative divergence  right at the open

 The 5 min has showed no improvement

 The 10 min is looking worse, it even showed distribution into the gap up today.

 The 30 min doesn't look as if it has reacted to this morning, but still remains negative as the momentum from the bounce faded the last few days into a negative close yesterday.

 Same situation with the 60 min.

 Look at the red volume this morning compared to the open of previous days.

While it's not unusual for gaps to be filled, the volume is pretty heavy on the gap retracement so far.

USO update

 USO 10 min-this s where the battle for longer term U

 USO 5 min

Gap is filled

Any of the Silver Positions

Are right now in a rather good spot as far as risk is concerned.  At least my perspective is silver or SLV needs to hold $29 so right now it's not too far from that. If JPM is successful at knocking down SLV/Silver, then we don't have too much risk as we are close to that area.

I still feel SIL is probably the better trade of all of them at this point. If JPM loses the battle, then the actual silver funds or physical delivery will outperform.

Also Buying SOXL as an intraday Hedge

Semis have long benefitted from low interest rates and a week dollar, this is a hedge on broad market strength and will be closed if the market comes back down.

Why would the market come back down? I'm not sure it will today, but this is what a momentum reversal looks like.

The wide candles are big upside momentum, fading into smaller candles, then we have a negative day, the next day a big gap up on the open with a close below the small star, "A Key Reversal Day".

NEW TRADES LIST IS UP

THESE ARE ALL RELATED TO SILVER. The first 2 are leveraged ETFs, these are best used for short-swing term trades. The third is an ETF on the Silver mining industry if you'd rather not pick a specific stock. The others are individual miners.

I'd pick one or two and treat the as a basket or one trade for risk management purpose, for example, perhaps a Silver 2x ETF and a miner or SIL. With the European markets closed by our early session, there should be little to move the Euro down as far as news which means unless something big news wise comes out of Europe late in their day or the US, the downward pressure on the dollar should help keep silver prices up, thus putting JPM into a short squeeze if in fact they are at the level, which it seems they may be.

We are buying for my private client, even with gaps up.

Buying DBS

This is a double long Silver ETF, but is for a short trade/swing trade.

Quick Wrap

So silver broke the $29 level today, we'll be looking at AGQ for some swing trades and SIL for a longer term position so long as SLV / Silver holds strong above $29 or advances. I'll post some charts tomorrow, but I'd love to be able to buy on a pullback, so long as $29 or so can hold.

ZH had this article up tonight, check it out and take a look at the charts below. This is what 3C shows and why the readings seems so counterintuitive.

http://www.zerohedge.com/article/glimpse-paulson-dumping-stock-funds-sales-lng-accounts-124-last-ten-day-adv

Make sure you read the article and pay attention to the known timeframes of accumulation and distribution.

 From the article- " Paulson & Co.'s 8 different funds/accounts are doing in Cheniere Energy (LNG) in the past 10 trading days is indicative of a broad based portfolio profit-taking, that has started on November 16 and is ongoing through today"


Note 3C is showing confirmation making higher highs with price-this is not accumulation, just showing a lack of distribution until 11/16 where the negative divergence on the 60 min chart is very clear and is now in a leading negative divergence.

 Also from the article, "he built up an initial 4.7 million share stake in the June 30, 2008 quarter at around $5.50/share, and then buying another 2.8 million shares in the end of 2008 at a far lower price." 


Note again the positive divergences in 2008 that correlate with Paulson's accumulation with the second period starting around October through December, other funds certainly could have and probably did piggyback his trade. The important thing to remember here is that smart money builds positions into sinking prices, at lows where there's not a lot of interest, at least until a volume surge into stage 2 mark p, that is when traders believe accumulation occurs, it isn't, it occurred much earlier.

On the daily chart, note 3C does NOT make new highs with price, the reason, LNG is under distribution.

Take a look at the dates and the charts and it will give you some insight into 3C and how the major players really operate. The article may also be telling us something about the market in general as Paulson was all over CNBC a few months ago talking about how high this market would go and basically it was a new bull market, perfect hype from a respectable source, but questionable. It's a sales gimmick-"Dumb money, the market will leave you behind if you don't buy" while he sells into that demand. Classic lesson in market mechanics and the deception of everything you see from level two quotes to CNBC experts.