Strange day

After spending hours tonight looking all around for clues as to what was unfolding today, I'm no further than when I summed up what was seen late in the day.

In terms of price expectations based on charts from before Tuesday, expectations were met, a quick intra-day move in to Friday's gap area and that move failing-all of that happened today, however on the way down, the charts I'd expect to weaken did not, that would generally be the intraday charts from 2-5 minutes, while most of the 1 min charts were in confirmation of the move down as would be expected. Late in the day there were some very new and some very strong leading positive divergences, the trouble is they were late in the day which didn't give them time to develop to give us an idea of what exactly they were.

The most common conclusion might be something like the market is not done fooling about in this area or perhaps in the gap from Friday. The more far fetched theory would be that there was a dramatic shift in the market based on some insider knowledge and we were seeing the leading edge of that activity, again not having enough time in the day to let them develop and give us a better idea of what we were looking at.

It may just be something as benign as the first option, I don't think however it was what I initially thought, noise. The reason being is that it was so pervasive through so many asset classes, each a little different in how they behaved, but each behaving strangely.

One of the first things I did was to look at GLD to see if it may be some QE based rumor, while GLD's 3C chart didn't look as bad as price action itself, it didn't jump out as being the answer. Treasuries, at least on the long end where the F_E_D has been busy, showed some 3C weakness in to their normal move up on a market move down, again suggesting that as treasuries gained as a flight to safety trade, there was some underlying selling in treasuries, which again suggests some kind of risk on move, whether that be the market making a short term move like today in to the gap area or whether it is the start of something bigger and we just saw the very leading edge.

What I can say is that although expectations were met today price wise based on very clear 3C charts from Monday and late last week, the accompanying 3C action today did not fit well with the price action.

I would say something is going on. Throughout the day the intraday timeframes from 2-5 minutes did not deteriorate as I would have expected and late in the day, the last hour, we saw some unusually strong moves in various risk assets. The problem being, those moves have the potential to tell us a lot, but they didn't have enough time in the day to tell us much other than they were unusual, thus we'll have to wait for Wednesday's trade to see how they develop.

If this is something bigger brewing like some sort of QE leak, GLD is not making it obvious, Treasuries are not making it obvious, MBS have been strong price wise for the last week, but again the underlying action there doesn't confirm anything right now.

I've decided to do the only thing that can be done and wait for the message of the market to reveal itself. I don't want to get too far ahead of myself and start assuming that there's some QE-type leak out there, although that was my initial impression, there just isn't enough evidence to support something like that.

I also don't want to scrap the outlook of the various trends that have developed in 3C over days, weeks and months and thus far have been accurate based on some strangeness throughout the day and some very strange activity during the last hour. It's always interesting to see something you didn't expect to see or to see Wall Street react to some inside information and have that knowledge before most anyone else on the retail side, but for now, the responsible thing to do is not to make assumptions, but rather let the market tell us. Wall Street is like a large ship, it doesn't stop and turn on a dime, we can, so we have the luxury of being patient and letting the message reveal itself, whether it is nothing more than a short term blip or the leading edge of something bigger unfolding in the market, but I do feel pretty confident that it wasn't just noise.