Full Index Update

There's still a lot to look at, especially Leading Indicators, but I wanted to give you a picture of where we are, which is right where we should be, right along the lines of what was said last night about a boring and dull market that lulls traders in to complacency, then gets exciting and moves traders to action, all the while setting the trap.

As I said last night,

"The market stays flat, middlemen fill and complete institutional orders in a stable VWAP environment and traders get bored and caught off guard before the market moves in a direction that gets traders' attention and calls them to action and then drops the floor out from under them-we've seen it too many times, but at this size it suggests quite a move to the downside."

Here are the charts, I'll be following them up with more information that gives us a better idea of where we are and whether it's time to start pushing some buttons.

(Sorry there are so many charts, but many of you know how to read them and can judge for yourself where we are-for the rest, it's a good view of the market in action)

QQQ

 Recently (last 2 days) the Q's have been strong intraday, just as with the NASDAQ futures, the 1 min QQQ chart is starting to deteriorate from its short term strength.

 The 2 min QQQ was as far as the recent QQQ strength went, it's starting to fade, the worse the 1 min chart gets, the worse this one gets.

 As mentioned there wasn't any strength beyond the 2 min chart recently, the 3 min chart above reflects this and as you can see the pop above today, talked about last night and also yesterday specifically in reference to the Q's as they needed the most relative strength to make it up to this area (although they are the only average not to cross it as of yet which has me cautious on timing) , is showing the kind of negative divergence we want to see, essentially as retail buys the break out in most of the market, smart money is selling to them and remember short selling comes across the tape as a sale just the same.

There is a slight intraday anomaly that needs to be watched, not in terms of anything more than tactical.

 The 5 min QQQ showing in line status and a leading negative divergence at today's move- another good sign for today's price move.

QQQ 10 min from a pretty large positive divergence to a leading negative divergence, this is smart money buying, sending prices higher and selling in to those higher prices.

SPY

 The 1 min chart is showing some heavy intraday selling as it leads negative here, remember it takes some time to capture, upload and post these charts so timeframes  like the 1 min will certainly look different by the time they are posted, I wouldn't trade off this timeframe unless you have a very recent update.

 2 min SPY leading negative at the move above the range just as we want to see. A 2 min chart could have EASILY confirmed price by earlier this morning if it was there, it isn't.


 The 2 min chart is migrating through the 5 min chart, so the divergence is stronger or gaining momentum and this is the perfect area for that to happen.

 The 15 min chart with a leading negative posture as soon as Trend #1 started with the pop to the upside. The white arrow is 11/16/2012 when this cycle started, I expect trend 2 to cross significantly below the 11/16 lows. If you look at the 15 min chart today you can see even though it's in a deep leading negative divergence, intraday it's pointing up, we want to se that point down and the next chart should help.

The 10 min chart is going negative, it is being fueled by the 5 min chart's negative and it should migrate to the 15 min above and send that pointing down.

IWM

 15 min IWM above the range (yellow) and the 15 min chart's long term and near term stance is clearly negative, I'd like to see a new leading negative low as well, that's just a bonus at this point.

 Starting from the faster end, the 1 min has a long term trend you can't see that is very negative, the move up today was not confirmed in even the 1 min chart.

 The 2 min with strength from earlier in the week as you may recall has shifted to a very negative posture and especially above resistance or the range.


 The 3 min chart and several others looks strange yesterday, almost doing nothing and there's still an element of that, although it is negative on this move in price.

 The 5 min which I told you Monday was strong and would lead to price strength Tuesday has obviously gone negative and even more so in to today's price. I suspect just like the Q's, the IWM needed this brief positive support to get it in line with the move above resistance, the Q's were by far the furthest away. After weeks of a flat range don't you find it strange that almost all the averages break above the same day and not on any news, but on overnight futures trade based on FX manipulation of the EUR/USD?

Remember I said I wanted to see the 15 min IWM (first IWM chart above) to hit a new leading negative low? This 10 min's weakness should migrate and help the 15 min chart do that.

DIA

 DIA 15 min hitting a new leading negative divergence on today's move above the range.

 The DIA has had the most consistent 3C confirmation trade of all the averages all week, you can see it here on the 1 min chart, but also note today's clear change in character, it actually started yesterday, but today is worse as price is higher.


 3 min leading negative, showing some extreme downside momentum.


 Hopefully that will continue over to the 5 min chart which is already negative *Note how all of the charts and timeframes are seeing negative divergences above the range, not 1 is in line). 

And the 10 min chart, the worse this gets, the worse the 15 min gets.

So far so good here.