Definitive Change in Character

With the last several days of credit not playing along with stocks, it was obvious that beyond the low volume short squeezes, there is definitely something wrong, not just as far as probabilities go, but timing of them, HYG is one of those signals that has been screaming.

This morning there has been a lot of inline readings in the SPY while some others deteriorated, now the SPY is doing the same as a very narrow ascending wedge forms on low volume.


From a conceptual point of view, with the evidence we have, I think yesterday's post, Potential Market Scenario, High Yield Credit and Momo Stocks (TWTR) laid out the path of highest probabilities.

Here are some of the charts, I was torn whether to notate them or not because the change in character is so obvious I didn't want to lessen it by drawing on the charts so there are a few with and a few without.

 DIA with a VERY clear change in character which may be the most significant because it was one of the strongest underlying charts of all of the averages this week and part of last.


DIA 2 min

DIA 5 min

IWM 1 min, with a very definitive change in character, I didn't want to draw on this beauty at all.

 QQQ 1 min

QQQ 5 min

And the SPY has finally joined, note the delicate ascending wedge. I'd look for 3C to put in one more lower low before I expected serious movement.

SPY 2 min in to the wedge.

More charts coming...