3C and Market Expectations, Targets hit...

This is very interesting to study, just to see how the market plays games and makes sure that the most traders at any one time are wrong.

If you look at Monday's closing actions in the SPY, here's what you would have seen.

First you would have seen a bear flag and a rally from the support line that couldn't make it to the resistance line, this is taken as a sign of weakness and that the next leg down will break the flag. You would have seen a large bear flag with the negative implication of a break to the downside, a new leg down would start with measuring implications in this case to SPY $120. On Monday all that TA teaches about bear flags had come true, the only thing left was the move to $120.


Tuesday at 12:04 a.m. (really very late Monday night), in this post called "3C Indications"  we had positive divergences and I first posted this chart and target in that post.

I had mentioned in updates that the market wants to confound the most traders at one time and to do so, a move back inside the flag was a likely outcome, 3C supported this view. The Yellow area was the target.

On Tuesday at 2:10 p.m. in this Market Update I updated likely targets based on the 3C charts, even though Technical Analysis themes say we should have been headed down, I posted this chart...

The first gap being the most likely target and the higher targets becoming less likely, but still within the realms of possibility based on the 3C charts.

Yesterday at 2:08 in this Market Update I pointed out what looked like an inverse Head and Shoulders in the DIA.

3C supported this view, the rough measuring implications would have been DIA $129, today the DIA made an intraday high of $129.03.

Here's where the SPY closed...

EXACTLY in our target range from late Monday night (technically 4 minutes in to Tuesday).

While other traders where looking at price action and price patterns and likely shorting the market for a big drop this week, before trade opened on Tuesday morning we already had a likely target for the market several days in advance, we've hit that first target today.

The short term positive divergences were pretty strong early in the week, but still only short term, as of today they are deteriorating so we are nearing the end of this "noise" cycle and I call it a cycle because it is specifically set up by Wall Street in advance, how else could we know about it days in advance and even the target area?