Closing Charts

This isn't the "wrap" post for the day and I have some other posts in mind. I can hear the rush of water over the falls. This is actually quite a stressful time as head fake moves can be much larger or more intense than you'd imagine and on the other side of the coin, once the market is this broken, the herd (I mean the institutional one of hedge funds that all follow each other) starts to grow restless and there's a "He who sells first, sells best" attitude, this is what happened with AAPL; the result? A VERY unpredictable market and this is exactly why I prefer to be largely in position by now.

Of course we want the best positioning in the most profitable looking positions, rather the highest probability trades which encompasses profit, risk and timing.

This is a quick look (very quick) at what we are looking at, maybe  some idea of timing and I'll add to this in subsequent posts with a daily wrap as well as position and new idea coverage and approximate areas.

Here are a few of the other averages, I want to show you the difference.

This is ES, the S&P E-mini Futures with a negative divergence intraday at the highs today as well as a leading negative divergence in to the close, looking at charts like this, I feel a sense of urgency like, "We must act quickly", but acting out of fear, "fear of missing the move" is as bad as any other emotional decision in trading. The truth is, there's always another bus coming along in 30 minutes.

In yellow I'm going to extra lengths to point out, there was no intraday positive divergence at the low/reversal today at all (a theme that runs throughout the market today). Typically the 1 min/intraday chart is used to call exactly these kinds of moves, but there was no institutional risk taken on from what I can see.

Overall, this chart does make me feel a sense of urgency, but again, emotions don't serve you well in trading.

 QQQ 1 min intraday is leading negative, the point being is the intraday timeframes are more timing than anything, it's the long term charts that show how broken the market is, the short term charts tell when we are closest to the actual price reversal.

This QQQ 30 min chart is just presented as it is a very clean trend, it shows only the divergences at the turning points precisely because the amount of accumulation or distribution at each turning point is very significant, all of the very small divergences have been removed.

 SPY 1 min intraday shows a very clear, very negative divergence today that is leading price making it the strongest type of divergence. Again, around 1:30 when price makes the intraday low before reversing for a move up, there is NO POSITIVE DIVERGENCE AT ALL!

Even very small intraday moves on light volume typically have some small divergence, this essentially tells us that other means were used to turn the market (I know of at least 1 ) which keeps smart money from having to invest anything long at this point.

SPY 15 min trend starting with a series of head fake moves around the triangle to the left as we suspected at the time. There's a small positive divergence, no where near larger enough for a move of this size, but our original expectation based on the charts was for a downside move around July 8th with the final new highs or VERY strong upside move to follow.


Something drastic changed in the days leading up to the 8th right before the minutes release, it seems they cut out the downside move that we were expecting out, there's a lot of evidence the market was already in the midst of making the downside turn when something changed.

Instead of a downside move that was to act as a sling shot for a very powerful final move up, they just levitated the market in the overnight session using the AUD/JPY (which I said last night, was weak and not going to move the market anymore) . There have been other means to move the market since including the SPY arbitrage, Bernie jawboning, etc, but there's no real risk on demand left at all.

 The 1 min DIA is clearly negative on the move up-smart money sells in to strength and buys in to weakness (they get better prices and they need the demand and supply to fill positions as large as theirs).

Note near the EOD or afternoon there was an intraday positive 3C divergence in white?

 The DIA 10 min is VERY clear as to which way money has been flowing on this last move, especially since just after the expected down turn, at that point the original accumulation at the start of the move would have been exhausted, luckily they can sell short and MM's/Specialists can go naked short.

The distribution since that move has been staggering.

Finally the divergence may not look as powerful, but on a 4 hour chart this is one of the strongest you'l see before daily charts. The trend is so clean as few other divergences were strong enough to make it to this timeframe, but the downside negatives are very clear.

We can't even see the smaller, but still decent size positive that kicked this leg off.

The point here being the market's fate is sealed as far as the strategic view goes, only some very small intraday positives today kept the market from falling apart, the DIA and IWM were used to lift the market intraday or at least to put in the divergence that "could " do so.

 Here's the 1 min version of a similar positive divergence in the IWM through the afternoon, this kept the market together, but it is an exceedingly small timeframe and amount, it doesn't stand a chance vs. the longer charts, but it does give us  (probably) some time to enter positions on strength like AAPL or GOOG mentioned.

 IWM 2 min shows the divergence, but much smaller, this means it was a very small divergence.

At  3 mins there's nothing, that is an exceptionally small divergence, I'm shocked it was even effective.

IWM 10 min with today's move being what I pointed out earlier in asking you what you saw, an obvious head fake move confirmed with strong distribution. This move in the IWM's situation popped out of a bullish continuation triangle meaning retail would likely have bought what they were selling today which is of course one of the main points of a head fake move.

IWM 15 min

IWM 2 hour, that's the big picture and it isn't pretty.