The 3C divergences on the futures are stronger than similar timeframes on the averages, perhaps because the futures are a much larger asset (price), but for whatever reason I'd say a 5 min 3C chart on futures is pretty close to a 15 min chart on the averages, the longer the chart, the stronger the underlying trade so a 1 min chart signifies intraday moves, but isn't where to look if you want to know what institutional money has been doing, although if you have a long enough trend like StockFinder provides (5000 bars), then it can be useful. For the most part institutional signals are picked up around the 5 min mark, the 15 min is pretty influential, but the 30, 60 and 4 hour are where the real trends of hat they are doing unfold-for the averages, again futures timeframes are even stronger.
The trade today on the NFP is horrendous, if you red last night's post you probably understand why a little more as it use to be "Bad news is good news" because the thought was it would usher in QE 3, but now it seems "Good news is bad news" because any improvements, especially after the F_E-D's new proposed yard stick of moving away from dates and toward economic developments now makes good news a potential adjustment in QE that market participants don't want, they want an amount and a date, not a "This could change", so as I suspected early today in the first post, the NFP coming in a bit better than consensus is now BAD NEWS, a total flip flop and all because of the minutes released yesterday.
ES/S&P mini futures
On the ES 1 min, other than the 4-5 am positive divergence sending the market higher, 3C has been in line with ES all day, no positive divergences, just following the move toward pre-NFP levels.
I rolled the 5 min chart back because I can't show this much history on 1 chart, that's Tuesday-Thursday in green, there's a positive divergence at the second set of lows (same level or support) that sent ES higher, but as it moved higher we see a negative divergence or selling/shorting in to price strength. Yesterday after the NFP, the divergence went leading negative, like what we saw in ultra QE sensitive gold.
This is Wed. -Present on the same 5 min Es chart, the leading negative divergence of yesterday has just grown worse and worse, this will eventually bleed over to longer term charts, divergences always start on early charts and bleed to longer ones if they are strong enough.
The ES 30 min chart shows a leading negative divergence and I doubt that the negative action on the 5 min chart has even made it here yet, so I don't think this will get better.
On the 60 min chart, if you read last night's post or recall the theory of QE having been front run and priced in already, you'll see in last night's post that is EXACTLY what F_O_M_C voting members said in the minutes, I only proposed it as a possibility, they confirmed it or at least it was a part of their discussions. Therefore, if that is true, it makes some sense there's a negative divergence in to the QE announcement. Price stayed rangebound for several days after while 3C went leading negative, then price followed to the downside quickly. This move to the upside today that is near the QE3 announcement has not only a local leading negative divergence, but compare 3C on the date of QE3 and 3C now as prices are similar, it's much lower.
NASDAQ Futures
1 min futures were pretty much right on all day, we just haven't seen the intraday or short term bounce from the most recent positive divergence, with futures we may see that in non US trade, like overnight, it's not the same as divergences in the regular market assets.
The 5 min chart hadn't shown much other than a positive divergence Wednesday , it now shows a negative in to the NFP highs and a leading negative today.
The 15 min chart was also choppy and looked like there wasn't a trend, it's there now with a leading negative divergence starting at the minutes release yesterday and getting worse in to the NFP today
The 30 min chart shows the chop where I mentioned, it looked like the market was confused, very few good signals, again, that is changing as the chart went negative yesterday at the minutes and worse today at the NFP.
A close up of the 60 min chart shows a positive divergence Tuesday, trend confirmation and a negative divergence in to the NFP-this chart lags a bit, but that's a pretty clear signal.
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