Financials Update/ Market Proxy/ MARKET

For this post to make sense, see yesterday;'s Financials/ FAZ MICRO/MACRO Market Proxy in which FAZ from Friday was one of the assets I wanted to hold off on adding to or calling out a new short position for those interested, it is one of several including transports that got hit yesterday, there are quite a few and together they act as a proxy for the market, thus the early part of the "Week Ahead" forecast expecting some strength followed by a sharp decline.

Yesterday's post goes in to more detail on the concept and FAZ (3x short Financials), but the post important comments yesterday were,

" This is FAZ's intraday 1 min chart,  this is where I'll be watching for the first signs of this turning positive and it would be the last place I'd probably buy FAZ as I don't like chasing price"

"Now you have some idea of the macro vs the micro market wide, what I'm looking for, and the size of this divegrence and what it portends, a move larger than the October rally."

This is FAZ in the last update at the bottom...

 FAZ at the last update, considering what I was looking for in yesterday's post moving forward today,

"This is FAZ's intraday 1 min chart,  this is where I'll be watching for the first signs of this turning positive and it would be the last place I'd probably buy FAZ as I don't like chasing price"...

This is what FAZ looks like now.

FAZ 2 min - for this chart to make any sense it has to be read within the context of yesterday's Financials update/Proxy post....Financials/ FAZ MICRO/MACRO Market Proxy

 In the mean time, XLF is now confirming with a sharp negative divegrence in to today's move, what I'd call a "Dead bounce", except in IWM's case, that may be called a dead cat bounce as the -2.84% move over the last several days is along the lines of the nearly -3% Nikkei 225 move.

 Financials/XLF leading negative/ distribution in to the move.

 And as confirmation, 3x long Financials, FAS also seeing distribution in to the move.

As for the averages, the SPY has deteriorated more...

 SPY 2 min as well as ES / SPX futures...

ES/ SPX futures intraday and this is migrating to their 5 min chart as well which is a pretty large jump for the Futures 3C version.

 QQQ continues to show the same divergence

And IWM would be a dead cat bounce, there's still the same negative divegrence as you can see,


These may not look like big moves, but as posted in yesterday's FAZ update/Market proxy, the big divergences or Macro themes are already in place, it's the small or shorter tactical charts that move multiple timeframe analysis from macro charts and strategic probabilities to tactical action and the actual move.

I'll probably add several more analysis updates before some position updates as I want to be sure, but thus far this is moving along the lines of Friday's "Week Ahead" and the more detailed Sunday night post,  Abe and Kuroda'a QE-Zilla Sends Japan in to a Triple Dipp Recession