Early Market Update

Charts to follow...

It looks like in early a.m. trade (which is distinctly different than afternoon trade as there are more games, more stop hunting, triggering of orders , etc) several averages are going intraday negative, this is likely a short term correction, but I will look closer at the Industry groups that they have the most exposure to.

Specifically the EUR/USD has some short term intraday negative divergences building, that alone is typically enough to put some short term pressure on the market. In addition the SPY and DIA are also showing the same, at this point they are not so big that a simple lateral consolidation cannot be riled out.

The QQQ and to a lesser extent, IWM look better.

On slightly longer timeframes like 5 min most of the averages are still in line on an intraday basis, meaning I don't think anything has changed as far as a move to break above the IWM's range, but just in near term intraday trade there should be a bit of a loss of momentum, a consolidation or perhaps a pullback in the SPY and DIA most specifically.

I'll check further on Industry groups to see if there's a rotational aspect.

This isn't super important right now by any means, but this is where we are likely going to find a tactical and strategic opportunity, as price breaks above some of these ranges/resistance levels, etc, we want to be aware of the underlying trade as it looks like it will set up a false breakout or head fake move which can be used very effectively to get the best pricing on a position or adding to a position while having the least amount of risk.

A secondary consideration is to make sure the message of the market is not changing, thus far I haven't seen anything to suggest that, but we/I must remain diligent in paying attention for any early clues that would suggest such a thing.