Opening Indications

We start the day with a Short Squeeze, some kind of short term pop looked pretty probable yesterday as I mentioned it in at least 4 different posts including the SQQQ, Trade Idea: (Swing) SQQQ Long

"I will set alerts for a head fake move below recent support lows and if they are hit, consider something like a QQQ put."


and...Quick Market Strategy Update

"I suspect we have a bounce from today's levels, I'm going to try and remain patient for that, I suspect it will be the usual suspects, HYG, VIX hammering, etc. , but there are so many little changes in character today it could take me all night capturing charts.

"One I like a lot is Financials/XLF short, whether it is FAZ long (which would be my preference ) or perhaps the right set up and a put position in XLF, but I'll be looking for either at XLF > $29.93."

And perspective on it beyond QQQ puts and possible SQQQ long and FAZ longs...

And perspective on it...

"As for a bounce from today's levels, I wouldn't say it's so much from divergences as HYG's position, VXX's position, TLT's position, however these pale in comparison to the move in the Black Swan Index, SKEW, someone is VERY worried, the $140+ level has been historically (according to CBOE who puts it out), Crash level readings so this isn't just the protection we have been seeing in Utility outperformance, recent VIX outperformance the last several days, this is something bigger and much more rare."

Sure enough, Most Shorted Index squeezed, which is very different than accumulation as the buyers are covering shorts, not buying longs, the sellers, well their reasons are entirely something different as every buy has to have a sale.

A= the FOMC, B=the Friday afternoon squeeze that didn't lead to much of a gain on the day and C was the deterioration as the Most Shorted names seemed to be sold short again as the Index fell hard yesterday which appears to have set up this morning's squeeze at D.

I'll obviously be looking for a possible QQQ put, an SQQQ long and FAZ long as the last two I was looking for a head fake move in both, see Trade Idea: (Swing) SQQQ Long from yesterday.

So far SPY has very little confirmation, QQQ looks like it is starting to turn, so I may be looking at puts there very soon.

 SPY 1 min non-confirmation

QQQ 1 min non-confirmation, but zoomed in to intraday...

QQQ looks to be failing already so I may look at QQQ puts VERY soon.

The same with IWM...although I favor QQQ

IWM intraday failing.

I also like SQQQ and FAZ long, but will have to take a closer look at both.