QQQ Put / Market Pullback Follow Up

The reason for opening the QQQ May Put (the expiration is just how I like to do things, 2-3x longer than I think I could possibly need) wasn't just the signals from last Thursday (holiday shortened week) that were posted in EOD Update for Next Week or what I wrote in that post as far as expectations that said it looked to me like we could expect...

"My initial impression is we get a pullback early next week, I want to say Monday, but there may be a little more work to do before we are there"...

With the charts looking a bit strange, not the normal migration of a divergence (again I believe that's due to what has been very low equity volume all day), but it really came down to confirmation, not just in the QQQ, but all of the averages, the Leading Indicators, Futures, but within the Q's themselves, here are just A FEW of the MANY charts I looked at for confirmation...each will trade roughly the same as their price/leverage relationship to the Q's dictates, but with 3C it's also a lot about the volume and as such, if there isn't something truly going on, we don't see confirmation between assets like the underlying and maybe a 2x inverse or 2x long.

Again, these are just a few of the charts, if I posted them all we'd have 40  or more just for the Q's.

QQQ

 1 min intraday negative, this alone wouldn't be enough by far.

QQQ 3 min intraday negative divegrence, even with this it wouldn't be enough to open a position (and I do think this is likely a pullback as mentioned last week, I think there's a very good chance we'll have some longs to enter soon for another quick trade as mentioned earlier when closing AAPL)...

 However when I am seeing 10 min negatives like this, I have to take that seriously, especially for what I expect to be a pullback-type move.


*The character of underlying trade during a pullback move will have immense amounts of information as to what we are looking at next and the larger trends some of us are already in to.

 With a 15 min leading negative like this, I'm almost obliged to take a short/put position, but I was still cautious because of volume and some anomalies on the charts so it's off to do what I encourage you to do as often as possible, Compare.

 This is QLD,  2x leveraged long QQQ at 3 mins with a leading negative divegrence. This chart confirms what I'm seeing in the QQQ.


This is the QLD 10 min chart leading negative, again, confirming the signals in the QQQ.

This is the 10 min QID, 2x inverse or short QQQ so it should give the exact opposite signal and it does with a leading positive divegrence.

I could go through every timeframe of every one of these and there's nothing but confirmation and it doesn't just stop at 10 mins...

 15 min leading negative in QLD, same as QQQ and...

15 min leading positive in QID , the inverse of QQQ and QLD...

And the 3x leveraged...

 TQQQ is 3x leveraged long QQQ with a leading negative 10 min chart confirming EVERYTHING above.

And SQQQ, 3x inverse/short QQQ with a leading positive also confirming everything above. 

And it's not just the 10 min. timeframes, as I said before, if I posted all of them for each asset I'd have 40+ charts.

The reason I felt okay with puts even though at the moment the market was seeing some downside and I don't like to chase downside with puts/shorts, I saw the NYSE TICK that looked as if we'd see a little EOD bounce... This made it easier to enter those positions without chasing...

 NYSE TICK data was trending up toward the close so entering a put wouldn't be chasing, the premiums would still be reasonable...

As you can see by the EOD action in the Q's the TICJK trend, as usually is, was correct.

The Index Futures look good asThursday afternoon for the start of this week.

As I was saying last week, "We use to trade the 5 min signals alone and we've had success with short term trades with the same 5 min signals recently". This is the NASDAQ 100 5 min Futures... leading negative.

There's no sure thing in the market, there are probabilities and this looks like a high probability/low risk set up, this is a hard one to ignore.