Opening Indications

I have quite a lot to look at, the FXI/FXP trade idea from yesterday looks like it has done what I was expecting to see and what would give us a good set up for the trade so I need to confirm whether or not this is a set up area. SCTY has done exactly what I was looking for, the gap up that closes with a bearish engulfing candle, we have the first part of that and early tone is deteriorating which is still way too early to say how it will close, but we can see whether there's any confirmation in the gap up or distribution as I'd expect to find, this was the original SCTY short set up and then because the add-to set up.

I'm also trying to fine tune an indicator (version of 3C) as single lot trades of 1 share have been clogging NASDAQ and BATS which allow HFTs algos to move VIX as the system is clogged, who sends out thousands of 1 share TVIX trades in seconds? There's something there, an HFT algo that apparently may have been kicked out of a Barclay's dark pool since the investigation started there seems as if it may be running on another DP, NANEX has some good info on it, that would give early warning on VIX movements at least in VXX and related ETFs.

Opening action has been very "cautious" I'd say, very few divergences as you can see in some of these charts of futures...

 Es about as in line as you can get and has been overnight, not even a USD/JPY 8:15 a.m. ramp moved it.

 TF intraday

And NQ intraday in line.

This does not change the fact that damage that seems disproportionate thus far to market moves was done yesterday after the Dow missed 17k by 1.3 points, how that can possibly happen without someone specifically preventing it, is beyond me.

 NQ 5 min chart shows the damage in larger timeframes since the Dow failure yesterday, but I've shown that already in many of the averages.

Speaking of which, they are acting the same this morning, I would say this is definitely pre-Yellen hesitation, why? I suspect the Q&A portion with Christine Lagarde may raise some tough questions that reporters won't ask (if they want to be called on again), but the head of the IMF will.

 SPY 1 min perfectly in line as of the open

Yet there was significant damage after intraday highs/Dow failure as this 5 min chart shows as it moves nearly straight down.

 The Q's which have had the best underlying trade since the flag started and closest to confirmation through most of the flag also saw damage.

 QQQ double checked vs another money flow indicator showing the same thing, confirmation until yesterday and then damage at the highs of the day and after in to the close.


 IWM saw the same as all of these moves yesterday were what we normally see on a flag-like pattern as far as head fakes go, I had even wondered earlier in the week how the flag would resolve, suspecting a break above and a head fake confirmation which we are very close to with the weakness that showed up, it's just the Dow 17k nearby that is strange, I'd think it would have been hit, juicing the sell side with all of those orders/volume before any damage was done, unless someone at the NY F_E_D's open market's desk specifically didn't want that. While Yellen said she essentially saw no problems with the market, that may be the facade to keep the market from seeing a black swan while the NY F_E_D manages a slow, controlled decent. That of course is speculation, but it fits with the dichotomy of what the F_E_D officials and what the F_O_M_C have said over the past month.

 IWM 5 min damage yesterday, again near vertical.

This morning you can see how little things are moving as the TICK in around a +/1 300 range, ULTRA TIGHT.

As for the TICK trend, my custom indicator shows something else with more information.

TICK as of yesterday and today.

A few things I'd be watching until we hear from Yellen (I imagine press releases as I haven't seen a live feed), TNX (10 year yields as well as Treasuries, esp. the 10 year, the $USD Index and any strange movements in VIX.

I'll be back after looking quickly at some of the trade ideas.