Market Update

I'm still looking at that intraday triangle and thinking about the short squeezes we saw on Tuesday. The signals I'm seeing suggest the break out move that has started (as expected per the last couple of updates), but still an overall bearish near term environment that should still keep us on track for a pullback on continuation of the pullback having started today. 

As I answer a lot of emails about a lot of different stocks and the market, I think I've found a good way to describe a short squeeze and why I keep adding the caveat of a short squeeze, it's not to sit on the fence. In my view, although we may see some market manipulation here and there to get the market in to position for a short squeeze, an actual short squeeze is probably one of the few remaining organic or real events in the market that doesn't need manipulation, the other would be a Black Swan sell-off. This is why I'm careful when talking about where we are RIGHT NOW, as a short squeeze feeds off of fear and is just a loop created by human emotion, thus it's one of the few natural events left in the market.

I still think from the signals we see and from the mass psychology, a breakout above the triangle (which would be a head fake move any way if it led to a pullback as the charts suggest), is actually the best outcome for Wall Street to manipulate the market so long as they can maintain a controlled burn and not let a short squeeze get out of hand and take on a life of its own.

 Hee's the triangle, it was obvious to traders as volume picked up on the breakout and it was a bullish continuation triangle so they would have expected it to break out to the upside from a technical perspective, the bears are bearish, it doesn't really matter what's there (if you recall the sentiment update).

 ES is still positive on the 1 min chart..

CONTEXT for ES IS NOT, the model is significantly lower than ES itself

 The SPY 1 min since going negative Tuesday and with today's a.m. positive divergence has a current position of in line, although that move looks very aggressive, it is simply in line with price.

 There's no positive on the 2 min chart, in fact there's a negative divergence.

And the 5 min is moving in line intraday, but from a leading negative divergence.