Market Update

In my last market update covering the SPY I said,

"I'd keep an eye on this... remember accumulation is generally in flat zones."
and after showing this chart...

"Support area, although it could certainly break that to surge volume on a head fake."


Well, that's what appears to have happened, exactly...

 DIA break of intraday support, volume surges, a perfect head fake set up for a bounce. The break down is obvious to all technical traders, they're going to short it, when prices move up, they're squeezed and add to the buying pressure when they cover.

 This is a relative positive divergence, measured between two relative price points, the second being lower then the first, but 3C is at least even if not slightly higher (5 min )

 Here we see the same support in the Q's broken for the same reason.

 and a 5 min relative positive divergence. If 3C was confirming the trend, it would have moved lower.

 And here it is in the SPY, causing volume to surge.

 The 5 min divergence here is stronger and in leading position.

We even have a 10 min positive divergence.


I believe the same thing is even happening in MCD as I warned in the MCD post.


All in all these are not huge divergences, but they have lasted most of the day. I think they have the capability of lifting the market.