Quick Market Update

I closed the FAZ calls because the volatility has been such lately that it makes sense for me to take a 1 day 11.5% profit.

Here's a couple of examples of the 1 min positive divergences. They formed in the right place, a break below yesterday's support and those gaps from yesterday's open are still going to exert a pull on the market until we have true break away gaps. As I warned last week, expect the market to get more and more volatile, a very big change since the days of consecutive .22%-.50% moves up which characterized the entire rally. Low volatility, small moves up, but consistent. As I showed last week, volatility (pre-NFP) is at least 50% higher then it was in February; it's probably higher now.

 Here in ES, as mentioned, there was no positive divergence on the first attempt to move higher off he open and that move met a negative divergence. The subsequent move below yesterday's lows is where the positive divergence is forming which makes sense with the volatility shakeout we see after a break of support (it use to be a test of resistance, now it's a much different market and one that is keeping the "Buy the Dip " crowd intact for as long as possible.

Later after the market close I'll cover the volatility again and show you what is actually happening when you strip away the noise. It's what I call "Slow boiling the frog".

Here's an example of the 1 min positive divergence in the SPY, this is even stronger now since I captured this chart