Market Update

So far the assets that are in the right area to start showing accumulation, are. Assets like QQQ had to break below the range so they are lagging a bit as they had further to go before a head fake move even started.

I'm sure there will be many other short term trading longs if you wish to trade around the market. As far as the stronger underlying trends that show massive distribution, they are all still very much intact which makes the real trade here a short in to price strength with all of the underlying weakness and those positions I prefer no leverage, just equity shorts for trending trades, plus a pure equity short (rather than a long inverse ETF) has benefits like being able to use some of the profits to pyramid the trade up.

 QQQ 2 min from Friday's distribution hinting at a break below the range and a likely head fake to price starting to make a "U" shape or reversal process with 3C going positive in that area.

QQQ 3 min leading positive in the same area after a leading negative from last week,  as I try to show as often as possible, 3C signals pick up right where they left off the next trading day, even over a weekend.

QQQ 5 min positive as it catches down to the rest of the market and breaks below the range which is where a head fake move would start.

QQQ 10 min leading positive and today's break below last week's range, still a very positive chart which is good for what we are looking for.

 IWM 1 min leading positive, this looks good to me as premiums drop on this kind of downside volatility for calls, for longs like IWM, TWM or URTY, I think you can wait a bit longer for more of the rounding reversal process to take shape.

 IWM 5 min from a strong leading negative divegrence sending price lower to the break under last week's range and a positive divegrence at that break under the range.

SPY 1 min positive divegrence and a good example of the rounding bottom, this is really a "Reversal process", a reversal is a process, not an event. On a chart a process looks like a "U" bottom or a double ("W") bottom, an event would look like a "V" and we see very few reversal events except when we have a strong parabolic move up or down.

SPY 2 min with good migration of the divegrence and leading positive. As the rounding reaches further to the right side of the chart, the divergence should pick up strength.

 SPY 3 min leading positive

You already saw the GLD charts and why I closed the GLD calls, this is the 5 min Gold futures showing the same thing, distribution in to this morning's price gains.

The 15 min chart shows the same. Remember, gold has been trading opposite the market so a positive divergence in the averages and a negative divegrence in gold is a sort of confirmation.

Also Short term VIX futures are showing a leading negative divegrence, this is also seen on real VIX futures below, this would be a rotation (short term) out of protection and in to risk.

VIX 5 min futures going negative

Another safe haven asset, 30 year bond futures are seeing a clear negative divegrence, the same concept applies as with VIX futures.

Hopefully this will allow a set up long TLT (20+ year bond ETF) on a pullback for a long term , primary trending position now that it has put in a solid base.

15 min 30 year Treasury Futures with the same distribution.

And the ETF version, TLT with a 3 min negative divegrence in to today's highs. I suspect as I said above, there's a short term rotation out of protection and in to risk assets as they are abundant in supply and on the cheap with a head fake move, this is one of the many reasons for a head fake move and why we see them so close to major reversals in all timeframes.