Charts

* I'm glad I took USO profits-at least for leveraged positions like Calls, they are already at a better price point which means that the position would just be losing its gains right now, instead I could re-open the position now and have a better price point and pocketed the difference in profits. I'm not saying I think USO is ready for a new entry yet.

These are just some charts giving you a visual of what I've been talking about today.

 This is the SPY/$USD correlation as of yesterday's close, it's quite clear, an arbitrage (legacy) correlation.

Here you can see the correlation acting as it should through yesterday's close and then today's difference which I already explained why I suspect it is there and that I believe it to be temporary.

 The $USDX 1 min futures showing them starting to drop after an initial -pre-market/ early morning spike higher.

This is the 15 min $USDX chart which is becoming more defined in its negative divergence and below...

 The 30 min $USDX that went from a leading positive divergence at the $USDX lows, the divergence showed the accumulation of the $USD in to the lows and then a move to the highs for the period. Ever since we have seen a leading negative divergence, this is the simple concept of selling in to strength which is different for smart money than it is for us because of position size, they have to get started earlier.

 This is the confirming 30 min ES chart with a leading positive divergence (confirms with many things, but in this instance with the leading negative 30 min $USDX above).

I've mentioned this from time to time, it's worth mentioning again. In my years of experience with 3C, I've seen this to be the case far more often than not. As mentioned above, institutional money needs to start building positions in to weakness and selling in to strength long before we do because of the sheer size of their positions. You'll notice the ES 30 min positive divergence really started around $1600, it continues in to lower prices because they need the time (the concept of the process) to accumulate or distribute positions the size theirs are. Even though common sense would tell you, "If they started accumulating at $1600 and continued through $1550, their average position cost would be somewhere in between". That's common sense. The reality I have seen over and  over through the years is that price (on the reversal) will often move significantly higher than the initial area of accumulation ($1600). 

I just say this because you might think if their average cost were something like $1560, they only need to move the market above that level to make it a profitable position, but in reality the moves tend to be far above that level even when there's a huge discrepancy between the start and end of accumulation (A VERY wide range of accumulation).

Looking at the SPX intraday chart and the $1600 area (which is interesting that accumulation would start there as it's a whole number/ psychological magnet which would likely see a lot of supply become available), it almost looks like a larger Inverse H&S.