PCLN Update

PCLN is a pretty good example of what is going on in the market and exactly everything we have expected since the break of the SPX 50 day on April 10th and the volatility bounce expected on the 10th.

 Like every other stock and average we have seen, the SPX, AAPL, etc, yesterday PCLN broke support, which means volatility shakeout of the new shorts and we saw the positive divergence develop for that yesterday. PCLN is back above the broken support level, this is what shakes out the shorts and gets the "Buy the dip" club doing their thing. The market NEEDS to sell/short in to price strength, but as we have seen, price strength is not the same as real strength.

 Yesterday's 2 min positive divergence in PCLN as all the stops that were hit were accumulated for a volatility shakeout of the shorts, everyone is getting tossed from their positions, this is when and why you keep your eye on the longer term and don't get caught up in the volatility/noise. Today where is the strength? 3C has not confirmed the move up, in fact it is lading negative, meaning the big boys and girls are selling/shorting in to price strength.

 The 5 min chart shows the extent of the accumulation of the longs stopped out yesterday, big volume on a break of support is the easiest and fastest way for Wall Street to accumulate without raising suspicions, even if it is just for a volatility shakeout, BECAUSE someone HAS to take the other side of the trade, so it doesn't raise suspicions and we know that they never want to show their cards, they have ust been a little too predictable lately. While some of the 2 min chart's weakness is bleeding in to the 5 min and while PCLN is back above the support area broken yesterday as we saw in yesterday's PCLN update, this 5 min chart, thus far looks like PCLN has a bit more to go on the upside, like I said, this doesn't have to happen tomorrow, but I would be looking at starting a position and phasing in to PCLN leaving plenty of room to add.

The 15 min chart has given some VERY clear signals for distribution, unfortunately in this case, yesterday's accumulation period was not as big as previous ones, we don't quite have the 15 min negative divergence where I would really want to start loading up on PCLN.