The 11 a.m. lows today were accumulated as is visible in the Index futures intraday 1 min chart.
The 5 min chart which is the standard divergence that must be in place for me to take a trade in either direction is "getting there".
TF/Russell 2k futures 5 min chart is positive, but not enough yet to be a high probability / low risk trade, it is a probability that we see a move higher, but we need a move we can trust to not just quit on us with no notice and to offer a low risk entry.
NQ 5 min looks even better...
ES 5 min is not there yet.
As far as last Friday's forecast of early week weakness flowing in to a larger base by mid-week as earning's season kicks off, it looks like that too is a probability, but not yet the high probability, low risk trade ... YET.
Friday is when the forecast was made, by Monday we were headed lower, today we are at or below last week's lows with a positive divegrence so it does look like the forecast of a larger base is playing out.
I said I expected a head fake move/stop run below last week's lows, the IWM has done that, the QQQ and SPT/DIA are yet to make a real head fake/ stop run, I expect they will which may open up a great entry for long ETF trades as well as long calls, we need to confirm strong 3C divergences.
Right now the SPY is off the lows or the base lows, but I suspect that this is not yet the move we want to take and certainly not chase.
Look at our custom SPX/RUT Ratio Indicator...
Fear levels have dropped back down and the Ratio Indicator isn't confirming the SPY's move, in fact longer term it is still calling for a head fake move or at least a move below last week's lows which I strongly feel will be a head fake move, this will likely be a low risk.high probability entry for long ETFs like the 3x leveraged TQQQ and URTY , UPRO, FAS, etc. Even if the market moves on the minutes, I won;'t chase it without knowing we have good support as the probability of sudden failure is high without that support.
I am seeing some interesting things, as usual showing up in the leveraged ETFs more so than others.
SPY 3 min positive, but 5 min is not.
IWM needs more work as you can see.
The Q's are looking good, but haven't made it to the 5 min chart yet.
URTY, 3x long IWM has a strong leading 3 min positive, but not at 5 min yet.
SQQQ, 3x short QQQ has a strong leading 1 min intraday negative, but not built out yet to the longer timeframes.
The minutes just came out, it looks like the initial knee jerk reaction is o the upside, remember, the initial reaction is almost always the wrong reaction.
What I'll be setting price alerts for is a head fake move/break below last week's lows of some significance for the other averages, and looking for accumulation in to that move, that would be the prime enter and a great spot for call option positions.
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