Yesterday's Divergence

Remember yesterday's positive divegrence? One has to at least wonder if there was some information or leak of today's massive Russian statement that they were in essence, "Just training".

In yesterday's post, Quick Market Update I even estimated what I thought the rough level of price would be based on yesterday's divergence (keeping in mind that the duration of the divergence has a lot to do with how long it can sustain the proceeding move and it was a single day yesterday). In any case I gave a rough target based on the divergence and reversal process...

"In any case the reversal pattern looks a little like an inverse H&S bottom, you could pull a price based target from that, for the SPY that would be about $186.50."

Today's SPY prices aren't that far off the estimate...

The SPY had the strongest relative performance in yesterday's divergence and was expected to do the best as it was the only of the 4 majors that reached a 5 min chart shown above. As you can see the SPY isn't too far off the target estimation from yesterday's post of $186.50-ish.

As for the 1 min divergences forming yesterday and their ability to confirm the gaps this morning...

 The SPY 1 min was showing some 1 min weakness late in the day as resistance was being hit, this morning so far there is no confirmation of the gap up.

The IWM was close to confirmation, but has since turned down.

The Q's had no 1 min confirmation of the gap up and..

The DIA which looked the worst yesterday didn't even try.

I find the sudden divergence building yesterday, but not firing until today a bit questionable.

From here I'll be looking for the 1 min charts to deteriorate and migration of that through longer charts. 

To me, the sudden divergence of 1-day on short term charts is appropriate for a news driven bump.