Final Market Update

It's another strange day today, but unlike yesterday with no movement, today there's plenty of movement.

We had good intraday negative divegrence signals for an intraday pullback, they look like they were rescued across multiple assets,but they also have made it to about 3-5 min  charts as negative divergences, I think the idea here is to reinforce to traders that any strength should be sold/shorted which sets them up for a short squeeze.

Depending on the asset somewhere around 5-10 min charts they go neutral and then 15-30 min charts are exceptionally strong, like as strong as you'd expect for a base area that has been created since Jan 27th suggesting a monster move up which we have expected, but now we have really believable signals.

I think this is psychological, teach traders they are rewarded for shorting strength and when the move doesn't come back they are squeezed creating even more momentum on a short squeeze.

Each average is a little different, but the Q's are a decent proxy.

Leading indicators for the most part are in line or flat, one sentiment was negative since 1 pm, everything else is flat which is a little unusual, but would fit with what I'm thinking above.

I'll keep equity longs in place, it's the options I wanted to take profits on, just like VXX, I think I can re-enter then at better prices.

In fact, VXX is the exact same example of what I'm going to show you on the Q's, it just trades opposite, but if you read the VXX update, it''s the exact same principle so we have confirmation there as well.

 Intraday was going negative and then it was rescued as you see to the right.

However as I said, there are negatives in the 3-5 min timeframe, then charts go neutral

5 min negative

This 10 min isn't neutral, but some other averages are in the 5 -10 min range, this is actually very strong

I'm guessing retail who is bearish shorts the market, the market moves down and they are rewarded, thus the next move up they short it again, but when it keeps going they either are caught or keep shorting until they are squeezed.

These strong charts that have developed very recently would definitely squeeze shorts.

IWM 30 min

This is the exact same concept in VXX, in fact I might look at a 1-day long in VXX via calls, I will not close any equity longs as the drawdown is insignificant and they are good positions for the trade.

I also saw something similar in Nikkei futures, the major change is the very strong charts on 15, 30 and 60 min that weren't there before so it too should see a massive short squeeze.