"There was a Dominant Price/Volume Relationship in all of the majors except the Dow, it was Close Up/Volume Down, 61 of 100 NDX, 801 of the Russell 2000, SPX 213 of 500.
This relationship is the most bearish of the 4 possibilities and often results in a next day close lower."
All of the major averages closed marginally lower except the Russell 2000, -0.76% as there was a late day scramble to push SPX futures back toward VWAP which they had hit several times today.
The very late day 3C action showed significant short term improvement which is something I had posted in the last update, looking for a probable ramp in to the close.
It will be of great interest to me to see if these improvements (which needed price to pullback to take place) will stick and finally give us an actionable area to enter some short term speculative (perhaps even swing) trade longs.
For example, the most improvement was in the IWM and QQQ toward the close which is when the big boys tend to come out.
IWM 3 min and the 5 min still needs work, but there was migration through the timeframes and rather fast.
The convincing part of these signals to me is that I may have dismissed them as a late day ramp to unchanged of VWAP for the SPX futures, but the IWM has no chance of either and it put in some of the strongest signals with migration to longer timeframes. I suspect if we have a solid signal and trade entry it will come tomorrow and I may still use weekly calls if the signal is early and strong enough, otherwise I have no reason I HAVE to trade.
The SPY which seems to be scrambling toward VWAP (SPX futures) actually had the least impressive end of day intraday charts.
Treasuries sold off modestly on the day and the 5 year yields as a leading indicator moved very close to short term reversion whereas yesterday they were pointing to more downside today.
ES/SPX Futures volume was 40% below average today, however as I showed later in the day TICK was showing some large selling with prints in the -1350 area which was about the same time these divergences picked up, something I had suggested may happen, supply being accumulated.
Today's Dominant Price/Volume Relationship was the most benign, Close Down/Volume down which has very little short term overbought/oversold effect, it's the most neutral of the 4 possibilities, but it is the dominant theme during a bear market ( as an aside).
Of the 9 S&P sectors, only two closed green, Financials and Materials, however, other than Energy, the losses were moderate in the -.25% range.
Of the 239 Morningstar groups, a light 58 of 239 closed green.
Changes in market breadth today were minuscule, barely worth noting.
What is worth noting was the late day changes in 3C and the fact that HY Credit is still supportive of a bounce, other than that, just look at the daily charts, it was virtually a repeat of yesterday with few obvious changes and all in all, the base area is still holding together which still puts short term probabilities in the corner of an upside bounce just as it was laid out in last night's Daily Wrap.
No comments:
Post a Comment