Futures- As predicted yesterday

Yesterday in this post I predicted what I thought the early market would look like and what the later day market might look like, futures tend to confirm that view...

With all that's going on with the Fiscal Cliff, year end trade, low volume, etc, not to mention a long overnight session, I hate to try to predict how the market will look tomorrow morning, but from the charts I have, I'm going to say weak in the a.m., maybe a gap down, maybe something worse, but this market showed us one thing today and it's what I've said a number of times, "When this happens, it will happen fast" so we could easily pop up in a volatile rocket-like move, ultimately though, the charts are still very much on the side of, "The market owes downside".

We have some decent positive divergences lined up on the 2-5 and even some 10 min charts which could give us that sharp pop that would make those January SPY calls worth some money, but the fact remains that the longer term charts and the length of the divergences on them are making this market like a very thin ledge that is cracking with each step.

And the futures...

 You may recall we started the overnight session with negative divergences, then a positive formed, I said in an overnight post...

SPX futures went negative just after the 4 p.m. (EDT) New York close, ES lost about 8 points from that negative divergence, since then 3C has bottomed and gone in to a positive divergence as it moves higher and ES moves lower, this should result in a reversal to the upside, but there is a chance this divergence becomes bigger overnight and that would lead to a bigger move, we'll have to wait and see.

The way the SPX and NDX futures are set up are perfectly as predicted, early weakness, but a longer positive divergence that could send the market higher later in the day and we do have the catalysts for it today.