So far the charts remain really interesting; on the short timeframes I think you have to expect volatility on a day like this. However on the longer term charts that really matter, Friday was an interesting head fake day and just about every average improved incredibly from the lows created from the head fake breakout. The bottom line, although I feel nuts for trying to predict market direction after an election, remains that what we expected going back to about October 19th sis still holding up.
Here are the intraday updates I promised and the interesting charts.
DIA 1 min showing intraday weakness.
DIA 5 min showing a leading positive divergence at the lows after Friday's head fake false breakout, currently the 5 min is in line with the price trend.
The special chart is the 15 min DIA with the move down to the left (and this looked much more serious back then before we could see what was coming after), the relative positive divergence through the range (23rd-31st) and the leading positive divergence to a new local high above mid October's rally high and most of this was all in a day and a half!
ES/SPX 1 min intraday futures showing an intraday negative divergence, they've lost some ground since this capture.
IWM 1 min intraday was in line and then went to a leading negative divergence, not horrible, but enough to expect a consolidation or pullback and not the continued uptrend that we had seen earlier today.
IWM 2 min shows the negative divergence and head fake / false breakout on the gap up opening last Friday, prices fall fast as they are supposed to, "From failed moves come fast moves" and a positive divergence at those lows. In my opinion either the market wasn't quite ready for the cycle to breakout or it had to do with weekly op-ex or something else, but the fact it seems they accumulated the lows seems like maybe they weren't quite finished with the cycle preparation-curretly in line.
IWM 10 min from the mid-October negative divergence (note it looks similar in all the averages), the relative positive divergence through the range (22nd-31st) and last Friday's head fake negative divergence leading to a much larger positive divergence at the reversal lows-currently leading positive very quickly, very strong on an important timeframe.
QQQ 3 min shows Friday's head fake move, note as usual the head fake is ABOVE resistance, which allows smart money to sell to buyers buying the breakout, they need demand and the breakout provides it, just think about what smart money needs to move in to large positions, not 100 lot orders.
Then we have the positive divergence at the lows from Friday's move like everywhere else and a small relative negative divergence intraday now. We may have to wait until Wednesday or so before we see how these positive divergences pan out, but I see no reason to close the leveraged longs we bought during the range last week.
QQQ 15 min from leading negative at the mid-October decline to leading positive from Friday's head fake decline with a relative positive divergence during the range, this is an impressive move on an impressive timeframe.
Interestingly, take the QQQ 2 hour which is leading negative in its trend and zoom it in, this is the first positive divergence since the September highs rolled over after the QE3 announcement, that's pretty impressive.
SPY 2 min intraday leading negative.
Just beyond that though at the 3 min, there's no migration of the negative divergence suggesting it is intraday and not much stronger.
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