Market Update

Here's that earlier positive divergence mentioned in the gap area.

 DIA 1 min is already starting to show some signs of the intraday bounce possibly fading, but each average is trading a little different today with the Dow looking the worst, followed by the S&P and the NASDAQ showing the best relative strength, I would expect that also to effect intraday bounces, with the QQQ probably holding up longer then the DIA.

 DIA 2 min positive as well, but Friday when I posted adding in to strength was the best place as you can see at the green area, there was market strength, but n to a negative divergence, thus giving you a high probability entry and the least amount of risk. Any add to positions in my opinion would decrease in size, the further we move away from Friday's highs, at least until SPY $118 is broken hopefully on good volume as that would reflect the last area of good support on a head fake move. Below that level, any longs that added on the breakout above the trading range in the SPY from $118-$120 will be at a loss and that should create downside momentum as the supply/demand balance shifts to one of more supply then demand and that should be reflected in higher volume as well. You would also be adding as the trade is confirming that it is moving in your favor. Remember the CCI chart from this weekend, if that is at all any kind of a model for the market, then the downside implications are quite severe. We are still very early on a possible reversal and break of the closed EUR/USD loop, so I would want to have good risk management, reasonable position sizes, confirmation of negative divergences in to market intraday bounces.

 QQQ 1 min-looks stronger then DIA 1 min as mentioned above.

 QQQ 2 min in line, slightly leading.

 5 min still negative, suggesting these are intraday counter trend moves from support from gap resistance.

 SPY 1 min came around

 SPY 2 min did also, but again, Friday was the best risk entry point. I posted at least twice to use that strength to initiate/add to positions, I know it's hard to do the opposite of what your mind and the market are telling you, but with negative divergences in place, it makes for a lower risk entry.

 SPY 5 min, including the gap support area in white, which as expected, we are bouning off of intraday. The 5 min chart still looks very bad.

 ES 1 min shows the positive divergence and what appears to already be distribution in to the bounce, however, distribution doesn't mean reversal, it an go on for more time, we are just seeing that the bounce is apparently being used to sell in to.

One way of judging a good entry point and the end of the current or a current bounce is to watch the 1 min NYSE TICK chart, draw trendlines and as you see the TICK chart/market are moving up, when the TIK hart breaks that channel, the bounce should be ready to turn down. As I mentioned, the QQQ will probably be the last to turn down with the DIA the first and the SPY the second to turn down.