Looking at a few more averages, it seems to me my opinion in the last update is the most probable course intraday in the near term (reversion to the FX correlation/arbitrage). Keep in mind Europe is closing soon, we often see some Euro strength after the European close on the hopes that everyone will keep their mouths shut (which rarely happens-but it is one of the trends we have observed).
DIA 2 min showing yesterday's positive divergence at the lows, remember the DIA has had the weakest 3C underlying action of all of the averages over the last few weeks. On the open the DIA was already seeing a small intraday negative divergence, on that little pop out of the consolidation it went even deeper negative, but keep in mind this is an intraday timeframe.
The 3 min DIA chart shows the trend/situation more clearly, in green there was price confirmation, since the close to this morning's highs, there's a decent negative divergence in place, I'm pretty well convinced it's the EUR/USD holding things up right now.
DIA 5 min trend with the positive divergence at the lows yesterday and the entire chart remains in line so the weakness from the shorter charts has not bled over to the 5 min, at least not yet.
IWM 2 min shows the same theme, positive divergence at yesterday's lows, confirmation of the move up (which is also in a leading positive position) and a negative divergence from yesterday's afternoon highs to this morning's attempt to break out of the range (given the look of the Euro, I'd be betting the move this morning out of the consolidation was nothing more than a small bull trap, which would suggest they may be working up some downside momentum for a move toward correlation with the EUR/USD).
IWM 3 min shows the same theme
As does the IWM 5 min-the R2K was yesterday's best performer so it has a little more froth to work off in a move toward reversion to the FX mean.
QQQ 3 min with yesterday's positive at the lows and confirmation , even this morning it's still in confirmation of price.
The QQQ 5 min chart is not negative this a.m., it's in near perfect price confirmation.
SPY 2 min went negative in to that attempt to break out of the congestion zone. It really isn't a very big opening range.
As for the Euro itself, it seems to be the most important aspect this morning, it went from positive to leading positive to a negative divergence this morning (1 min).
The 3 min since going very positive yesterday is still in a large leading positive divergence and price looks exactly right for this type of divergence.
The 5 min is leading positive, as for this morning's action, the 5 min is in confirmation.
I'd guess we either stay choppy in a range here (congestion) looking for the Euro to make a move higher as European markets close and if that doesn't come, I'd expect the market to probably pullback a it toward the correlation. The market's just got ahead of the correlation on yesterday's afternoon rally.
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