The Averages...

 DIA 1 min, the DIA has been a 3C laggard, today it looked a bit better than other averages (relatively speaking). The 1 min trend has gone from positive to confirmation, today there's a leading negative, again suggesting more near term downside.

 A closer view, like everything else, the DIA was negative on the open, saw some intraday positive and negatives that weren't too impressive, but the end of day action is the most impressive divergence in a leading negative position. I'm speculating, but it seemed the averages weren't going to move low enough on their on and got a helping hand for reasons I've outlined.

 Again, even as a laggard, the 30 min chart is the largest divergence since the May 1 negative at the top, the yellow arrow is the false breakout of the bear pennant, a Crazy Ivan shakeout to the upside followed by a shakeout to the downside, the leading positive position just seems too big, too intentional for a 2 day upside move from the point in which the SPX made its low breaking the 200 day moving average (another closely watched indicator). Again like so many other asset classes the positive divergence starting on the 7th and running here until the 10th (other assets saw it run until the 15th and a few beyond) is curious.

 Keeping things in perspective, the primary daily (2-day here) chart of the DIA shows a leading negative divergence that is now at the same area as the 2009 lows. The negative divergence culminating in late July of 2011 that led the market down 20% is also clearly visible. If you look at 3C since the October lows/rally, you can see why I've been suspicious of the entire rally.

 QQQ 1 min like everything else from industry groups to currencies was negative on the opening gap up. The EOD saw the largest divergence of the day, leading negative, which is why I suspect the invisible hand was at work in the market as it seemed like it was going to close higher with an ambiguous star like close, I suspect there was a late day effort to push the market lower. Again, this is why I posted that article yesterday regarding what to expect at certain levels such as the area we reached this morning, what I called "games" in the market at those particular price levels.

 QQQ 15 min negative on the open and a leading negative divergence got the market moving lower EOD. The longer term trend of the 15 min QQQ chart has been in leading positive position since May 7th.

 Even the hourly chart has been moved to a positive divergence in the Q's, a divergence this size seems very out of place for a 2 day move up. The positive divergence on the 7th is visible on this chart and the strong relative divergence at the recent lows is larger than the May 1st top. As you can see the 60 min chart is leading positive. Just look at the overall 3C/price trend, a clear change in character is obvious.

 For perspective, the daily QQQ chart with a very fast and sharp negative divergence at the top with a deep leading negative divergence, this is the primary trend, the reason why I have kept the core short positions and the reason why I view longs as worthwhile, but speculative. This chart suggests the next primary leg down will be quite large as this is the strongest divergence in the QQQ , even worse than the 2000 tech bubble. Without going in to a new post, the reasons for this very strong divergence have their roots in F_E_D manipulation of the market via QE/POMO. There was no true organic strength in the market, this is clear when overlaying the QE1/QE2 periods on the price chart, when there was no QE the market started falling apart. Thus the only reason the market has moved higher since 2009 has been policy intervention consisting of flooding the economy and banks with liquidity that found its way in to the market. When you have money at .75% interest, of course you are going to put it to work in higher yielding assets. I believe QE 1 & 2 served 3 purposes, they allowed Congress to keep spending, they made it possible for the US to keep issuing debt in a debt market that was otherwise getting soft (as China slowed their purchases of US debt to a trickle), they made it possible for the US to pay debt obligations at a much cheaper price as the dollar was devalued (yes your bonds were payed, but with dollars so devalued that you actually lost money) and finally it allowed banks that were near the verge of collapse to post impressive profits rather than the F_E_D having to bail them out. From today's Bernie testimony though it seems clear that he is sending Congress the message that they can't keep doing this, that ultimately the problem must be resolved on Capital Hill by cutting spending.

 SPY 5 min -positive at the recent bottom with a negative divergence on the open and a leading negative moving throughout the afternoon.

 SPY 30 min going back to March. The March top, a bounce in to the Mat top and again that positive on May 7th the SPY stayed in a leading position through the bear pennant and went even more positive at the breakdown lows to form a current leading positive divergence above the May top.  No matter how ugly charts were today, it didn't move the 30 min and the size of the divergence is just too big to think 2 days of upside is what this was all about.

SPY daily chart for the primary trend perspective. No matter what lies ahead, even if we saw a rally to new price highs, there's just too much damage for this market to escape its fate short of massive intervention and even that may not have the same effect as before, too much has changed.