Opening Indications

Last week as the market's price trend followed HYG (which as credit tends to lead the market as if has all through August) and turned from a clean uptrend to a more lateral, rounding top  (which is why I posted the "Igloo with Chimney " reversal process and head fake move as that is what looked to be the most likely reversal process), I set a number of price alerts in a number of different assets that were of interest and a bunch of those have gone off this morning, a few to the downside, but most to the upside on the head fake move I was looking for. This is the same move that offers the best entry/exit at the best price, lowest risk and often the best timing as the head fake move tends to happen whether a bottom or a top and right before the actual, reversal.

AAPL is a clear example of this and the "Igloo with Chimney" which I drew early last week so you'd know what you were looking for and where to set price alerts. The AAPL Trade Set-Up from last Wednesday predicted exactly what we are seeing now,  thus it was a "TRADE SET-UP" post rather than an actionable "TRADE IDEA" post. If you look at the AAPL Trade Set-Up nearly 4 trading days ago, it's almost exactly what we are seeing now.

 Here's AAPL's base process, largely the same as the broad market which was 8/1-8/8 and AAPL from 7/31 - 8/8. Note the head fake move in AAPL's base on 8/8 just before the upside reversal, this is the SAME CONCEPT as the reversal process (as that's what the base was)  with a head fake move now (the exact same concept seen in the base just before it broke to the upside on 8/11).

There are very real and logical reasons for these moves, again they are linked on the right side of the members' homepage under the title, "Understanding the Head Fake Move" parts 1 and 2.

Look at AAPL's clean uptrend turned lateral/rounding and a "Chimney" with a declining 3C, again, just as described mid-last week (Wednesday).

Numerous others have triggered this morning as well such as Transports/IYT.

 Here are Transports (DJ-20 / IYT) again described in a post Wednesday of last week, IYT/ Transports Trade Set-up. Note again, this is not a Trade Idea, but a Trade Set-up, what we are looking for in advance for the trade to set up.

So I have numerous price alerts being triggered, HYG crashed this morning from it's nearly 2-week lateral trend under the flat range, but is recovering a little.

As far as the SPY...

On a daily chart, this move is at the area or breaking above the area that would denote a head fake move,  but for a head fake move to be effective, it must be believable and with such low volumes and such small price moves the last week+, this move thus far does not look believable. In other words, it has to create the greed in traders that makes them want to chase it rather than wait for the dip (Buy the Dip) and to do that, it has to be strong enough for them to have their normal rules overruled by their greed.

So the market's broad move thus far this morning doesn't look like the kind of head fake move (yet) that would inspire that kind of greed. The concept is the same as the AAPL break down below support, it was sharp enough to cause fear and the panic selling/short selling that gives head fake moves their momentum.

I do think there will be different assets that are ready for a entry / trade before others, not all at the same time, but the highest probability is to align individual trades with the broad market doing the same thing and confirming each other.

On that note, I don't think we are there, although most of my time today will be split between broad market analysis of where the averages are in this specific process and individual trade ideas and where they are as some are not looking great this morning.

Chart updates will be out as actionable or near actionable trades set up as well as letting you know where we are in the process.