Daily Wrap

Insane volatility today sums up the day. As of last night's S&P and Morningstar groups deeply oversold, the natural close today would have been green, although the Dominant Price/Volume Relationship supported the same, it did not have the same level of short term technical oversold as did the 9/9 S&P sectors in the red.

I have very high risk tolerance and prefer to trade strong swings often to roll over (accrue) funds, but there's a reason just about every one of my positions is aligned and staying aligned with this chart.

As I have been warning for 6 or more months now, Market breadth is so destroyed that the market appears to be a tall pier stretching out deep in to the ocean, but below the pilings that hold it up are rotted to the core and it just takes one forceable impact like a wave or a fundamental event that isn't priced in like Russia, to knock everything down.

This is the path of highest probabilities as we knew it would be when we forecasted the October rally off the lows more than a week in advance. This is also the reason I have not put out new short trades as I would like to or bounce trades as we may be dead right on the scenario envisioned around the Russell 2000, but without a strong edge, the trade is not worth the risk, patience and letting the trade come to us on our terms is.

Volatility was evident in the market where the Dow had a 360 point range and an 800 point round trip and the SPX had a 44 point range and 100 point round trip.

 The major averages today (SPX -0.85%; RUT -0.08%; Dow -.65%; NDX -1.63%; Tansports -1.32%). There was short-lived buying shortly after the EU close which seem to be struck down on Kuwait's announcement that oil production would remain as is.

The NDX as seen in 3C charts recently, was the worst relative performer and ironically, the IWM, according not only to our "scenario", but 3C charts was the out-performer as their charts have indicated in underlying trade.

There was also volatility in the Commodity space...

 GLD was up +.49%, SLV down -2.52%, Copper 0-0.26% and USO +1.14% on significant volume which makes me curious about our speculative Call position there. Commodities as a group actually did revert to the SPX's short term mean today.

Volatility was also seen in Treasury yields as they lost 10 bps, then gained 10 bps and then lost 8 bps today.

Notably, the risk off moves we have seen in High Yield Credit started hitting the safe haven of Investment Grade Credit as well.

Volatility has been insane as is easily with a chart of the VIX.

 Note Today's (and the last several days') very wide range in the VIX on this daily chart, closing ABOVE the Bollinger Bands in a Doji Star, indicative of indecision, there was lots of that going around today.

Intraday strangeness in the VIX seemed to subside after 12 p.m., some think the wild intraday moves of the last two days are do to market markers widening their spreads.

However the US may have gotten off lucky so far. Across the globe markets are cratering, the MSCI Emerging Markets Index fell 1.2 percent. Developing-nation stocks slid to a 16-month low.

The emerging-markets stock index has shed -7.8 percent in an 8-day losing streak as of Dec. 5. Also in developing nations, a gauge tracking 20 developing-nation currencies fell 0.4 percent to the lowest since at least 2008.

The Middle East is being hit hard...Dubai’s DFM General Index (DFMGI) and Abu Dubai are down -8% since Friday with Dubai's General Market Index down near -40% since the peak in oil this June.  Saudi Arabia’s Tadawul All Share Index dropped -7.3% today for its biggest 1-day loss in 6-years. Most Middle Eastern markets are down 30-60% since June as oil prices started crashing, Kuwait is down almost -20% YTD. The exception is Qatar which is still green YTD. Yet even today Kuwait let the market know that OPEC would NOT be altering supply levels until the next meeting in June, sending the market packing lower intraday it seemed and all of this to defend market share as the U.S. shale market was booming, now that’s exacerbating a global glut along with a steep drop in Global manufacturing and demand with Japan in its 4th recession, Europe very close, Chinese data getting worse and worse and now...who knows what's next in Russia.

After failing yesterday to halt the Russian Ruble's decline by central bank intervention, overnight the Russian Central Bank unexpectedly raised the benchmark interest rate to 17 percent from 10.5 percent in an effort to stem the collapse in the ruble that is threatening the entire Russian economy with overtones of Long Term Capital Management and the 1998 Financial Crisis, also emanating from Russia, in many people's minds.

 The Russian Ruble is the worst performing currency in the world losing about 60% of its value this year with the -48% decline in crude prices since June having an ever worsening effect on the Ruble as oil prices dipped below $55 a barrel. However the Russian Ruble is far from the only one stricken and the Russian Micex benchmark stock index is down nearly -30% this month alone.

Emerging currencies slumped to a record with the ruble plunging for a seventh consecutive day. 

An overnight report of Chinese factory output declining and moving in to contraction didn't help matters, pointing to weaker demand for raw materials including oil. The US's PMI Manufacturing came in today at 53.7 on consensus of 55.2, the biggest miss on record and the 4th consecutive monthly US Manufacturing decline, also the 4th consecutive miss to expectations. Employment and New Orders slumped in the report's sub indexes and this after German PMI Manufacturing hit an 18 month low. In Markit's opinion, the slump in US manufacturing will hit hiring as the employment sub-index is already showing. 

USD/JPY was largely in control today (candlesticks) vs. ES / SPX E-mini futures, with an interesting unwind near the cash close, it looks like a carry unwind.

Things worsened throughout the day for Russia as first 3 retail FX dealers said no more trading in the Rubble as banks aren't pricing it, by the end of the day, short term finding by Goldman Sachs was cut off in short term repos with other banks likely to follow.

This was exacerbated tonight when the WSJ reported that, "Global banks are curtailing the flow of cash to Russian entities, a response to the Ruble's sharpest sell-off since 1998's Financial Crisis", which means Russia probably has about a week or two before they need to find short term funding as globally banks start to refuse to lend or repo with Russia amid uncertainties over the ruble and possible controls.

Among Leading Indicators at the close as things moved around so much today:

Our custom SPX/RUT ratio (red) did NOT confirm the late day lows and the VIX term structure (green/white) below added more short term buy signals.

The VXX was in line with the SPX's correlation while the spot VIX severely under-performed.

TLT was about in line with significantly better relative performance at the European close.

 The ramp[ing lever we have observed being accumulated, HYG out-performed the SPX on a relative basis intraday, especially in to the close.

 HYg's positive 3C divegrence is now pretty darn strong, more than enough to complete the Crazy Ivan move I suspect we are heading for in the Russell 2000.

There was some short term, small intraday distribution , especially around the European close that continued, HOWEVER I DO NOT EXPECT THAT THIS IS A NEW TREND EMERGING IN WHICH HYG ACCUMULATION IS UNWOUND, although I'll be on the look-out for any such event.

High Yield Credit which has also been leading the market via selling off vs the SPX for weeks, also closed with a leading positive component and this IS NOT the same lever manipulation HYG sees.

 The recent trend in HY Credit that has been leading the market via selling off changed today for the first time in I can't remember how long near term...

This was the intraday move, a close in the green in to the closing hour with relative outperformance.

SOMETHING IS STILL GOING ON AS WE EXPECTED.

Interestingly our Professional Sentiment indicators that were acting apathetic earlier today, showed for the first time in a long time some near term strength, again along the lines of market and specifically IWM expectations.

For a leading indicator that has been in sell mode every single day for weeks consecutively, today's relative out-performance, especially in to the close suggest Wall St. has set up the cycle that we were theorizing about based on the IWM's range and a Crazy Ivan shakeout which is 1/3rd done.

5 year yields, although hardly a strong leading indication right now, are outperforming 10 and 30 year yields as the Interest Rate Yield Curve continues to bearishly flatten.


Today's Dominant Price/Volume theme was almost non-existient with no theme in the SPX or R2K, although the SPX did share two different themes that were near equal and dominant above the other 2 possibilities, both were Price Down with the difference being one had volume up and the other volume down. The R2K's theme was evenly spread out among the 4 possibilities with only the NASDAQ 100 and the Dow with Dominant P/V themes, both Close Down/Volume Up (14 of the Dow stocks and 50 of the NASDAQ 100). For the NDX and Dow, this theme is most often a short term (1-day) oversold event with the next day closing green, however we saw something similar with a short term oversold condition in industry groups yesterday that should have led to a green close today.

While we are on the subject, of the 9 S&P sectors, only TWO of NINE closed GREEN on the day as opposed to yesterday's 9 of 9 red. The leader among the S&P groups today was Energy at +1.16% and the laggard was Consumer Discretionary at -1.54%.

Of the 238 Morning star Industry/Sub-industry groups, 62 of 238 were green on the day.

Interestingly I looked at both the S&P sector and the Morningstar groups on a multi-day basis. On a 5-day basis, NINE OF NINE S&P groups are RED with Utilities leading at -2.13 and Materials lagging at -5.95%. For the same period of the 238 MS groups, ONLY 5 OF 238 WERE GREEN OVER 5-DAYS! 

Over a 10-day period (2 trading weeks) AHGAIN OF THE 9 S&P GROUPS, NINE OF NINE  groups are RED with Utilities outperforming at a loss of -1.98% and Energy lagging at -8.35%.

Over the same 10-days, only 14 of 238 Morningstar groups were GREEN!

On a 21-day basis, only 2 of 9 S&P sectors were green , again with the defensive utilities leading at +1.20 and Energy lagging at -13.92%.

Over the same 21-day period, only 67 of 238 MS groups were green. Interestingly besides the very ugly theme across timeframes, the defensive Utilities were leading so that's your recent trend.

Quickly , breadth continues to decay. Of the NYSE Stocks, only 26.86% are above their 40-day moving average (DOWN FROM 70% on November 26th, the last defense day of the market before Black Friday), while only 38% are above their 200-day moving average.

WHILE IT IS EXCEPTIONALLY CLEAR THAT THE PREVAILING TREND IS VERY NEGATIVE IN UNDERLYING TRADE, BREADTH AND LEADING INDICATORS, THE EXAMPLE THESIS OF WHAT I EXPECT IN THE RUSSELL 2000 LOOKS LIKE IT'S VERY MUCH STILL ON TRACK.

The market is still as broken as ever or rather much more so, but this head fake move is just a representation of that , although like many events where price is concerned, it may not seem that way at first, but book mark this post, such a Crazy Ivan RUT head fake move will lead to an even sharped downside move than last week's horrid performance , allowing us to add to short positions at better prices and much less risk with the best timing signal we have conceptually...THE HEAD FAKE MOVE, RIPE IN THE RUSSELL 2000/IWM.

The SPY, QQQ and IWM's closing 3C divergence portrays additional weakness tomorrow morning, but the divergences needed for our head fake move are still in place. I would suspect we'll probably see it sooner than later, in fact tomorrow's F_O_M_C looks like the most logical place as the Knee Jerk reaction would be a perfect place, perfect ignition and perfect cover for such a move. Remember that F_E_D events almost ALWAYS see a knee jerk reaction and it is almost ALWAYS wrong, so this would fit perfectly at the 2 p.m. policy announcement and the press conference following.

As for futures, gold looks like it will see some overnight gains, perhaps in to tomorrow.

All 1 min Index Futures are leading positive in to the overnight session and as expected, at least one of the Index futures has already seen the 5 min chart go positive, guess which? The IWM!

The 7 min charts remain positive so I think we are now on track with the remaining Index Futures to see their 5 min charts go positive in the overnight session as the 1 min. are positive and as I said, the Russell 2000's already went positive t0day as it was not earlier.

Tomorrow looks to be the day, it will be a busy one for us!

I'll update futures if I see anything standing out.

Several Possible Longs

I do see several possible longs, what they lack in every case is any sort of reversal process. This means they are exactly what I'd fear the most, an asset with no base to support it that can essentially fall at a moment's notice or no notice, being there's no foundation and that might be in fact what an IWM head fake move would look like and why these piggy back long ideas are so distasteful to me as they look like risk beyond their profit potential and just 180 degrees in the opposite direction of all probabilities.

T?here are a number I'm compiling that I would absolutely consider short sales in to any strength, especially if it's a "V" reversal (no base) making the move highly unstable.

I really don't want to start bad habits here and now at this area in the market over several possible percent when everything is so lined up with probabilities just to be right on a bounce and wrong on entering the trade because of risk.

Leveraged Market ETFs: URTY/SRTY

As I suspected, since this seems to be based on IWM, URTy is probably the best chance one would have to try to piggy back a head fake move to the upside. Since there's so much more volume in SRTY than URTY, I used it to show the signals, but I did confirm the URTY signals matched or rather confirmed.

I still would not remove myself from reason of probabilities and the discipline of patience to try to scrap a few extra bucks when such risk to do so exists and such opportunity is with the probabilities and the potential of missing that potential.

SRTY is a 3x short / inverse Russell 2000 ETF and another I personally hold.

If you were trying to play a short term piggy back IWM bounce, you'd probably use the 3x leveraged long, URTY or the 2x leveraged long UWM.

The charts below are the 3x leveraged short SRTY, again because they have significantly better volume, thus clearer signals, but they have been confirmed.

 Again there's a 3 min negative, not a very strong timeframe, but it is several days of divegrence which is along the lines of what I'd expect for the IWM to make the kind of move I have suspected it will try to make.

The 5 min chart also shows a relative negative divegrence which is a weaker form of divergence, but it too has some time under its belt, more or less since we started noticing this late last week.

Even the 10 min has a negative divegrence and for this reason I like URTY best, although I will not be trading it and rather just staying patient and staying put in SRTY (long).

The 30 min chart which isn't the strongest of them, shows the in line status at the October decline and the negative divegrence at the October highs for SRTY/lows for IWM. The size and strength of the positive divegrence since is enormous, I would not break from these probabilities to chase near term gains at a time like this.

I would consider a move below the range (yellow arrow) to be an excellent SRTY entry as that's where it would go if the IWM did in fact make the move I have been theorizing it is likely to.

UPRO, the 3x long SPY came in a close second place or a 3x leveraged piggy back long trade.

Leveraged ETF's TQQQ/SQQQ

I'm still trying to answer the question whether I'd trade anything long here for a short term trade, what we call a "Piggy back" , especially if that meant closing a core short position to do it.

Thus far looking at TQQQ (3x long QQQ) and SQQQ which I have a long position in (3x short QQQ), I would have to say I would not change anything in resounding fashion.

 TQQQ with a minor 2 min, 2 or so day positive divegrence,  this looks more like a correction move if that than anything else and I would never close a core position over a corrective move, the last time I did (AAPL) I missed the biggest trade in AAPL in years.

 There's also a slight 3 min positive as well in TQQQ

As a reminder of trend and probabilities, this is TQQQ's 10 min chart since the accumulation at the October lows through present's deep distribution, but if this weren't bad enough...

This is TQQQ's 60 min chart. Any long trade here would be against very high probabilities.

As for the inverse, SQQQ long (3x short QQQ which I personally own)...

 Like TQQQ, the divegrence is only minor on a 2 min chart and only  several days, it may be more than enough to accomplish the goals re: the IWM head fake,  but I would not trust a long like TQQQ to hold it together and the probabilities of a surprise morning gap down would be very high.

 SQQQ 5 min is perfectly in line with its uptrend as the Q's lose ground.

And compare the 60 min 3C chart here vs TQQQ above.

That answers the leveraged QQQ trade question.

Quick Look @ UNG

I still like UNG/UGAZ (3x long natural gas) in the area, which looks to be a basing area meant to gather a head of steam for a breakout that will stick or to accumulate a larger position.

Form long term highest probability to short term, timing charts and in between.

 60 min

15 min basing area

3 min trend at the basing area

Intraday, it looks like the lows at the white trend line are an accumulation zone with higher prices being pushed back to the accumulation zone, this looks like a fairly positive short term timing chart, although leading would be more interesting. Still holding UGAZ 3x long NG.

Quick Market / Leading Indicators Update

As for Leading Indicators, I am not seeing the kind of divergences or signals that suggest any kind of upside move with any kind of staying power, if I were to be correct about an IWM/Russell 2000 head fake/failed breakout above its range leading to a real stage 4 decline (much worse performance than last week's 3 year lows in weekly performance), these are exactly the kind of shoddy signals I'd expect , especially if the move were to also trap the Santa Claus rally longs who believe that this rally is just a formality, that the market never misses it as this could be used to devastating effect as a weapon of Mass Psychology and we are just about at the perfect area in December for such a move to start.

VXX intraday is inline with the SPX correlation, however VIX (spot) with strange intraday volatility is not, it is lagging the SPX which is no surprise once you've looked at the VIX's daily chart.

 VIX vs (inverted) SPX (green) with weaker relative perfromance and odd intraday volatility again.

My custom SPX/RUT Ratio short term is NOT confirming the market lows and supportive of a near term bounce as is my custom VIX term structure which is inverted and giving a short term buy signal which I showed yesterday and about how long such a signal moved the market- not very long or far.

 Here's the same signal on a slightly broader basis, encompassing the timeframe when we first started to see these things suggesting the IWM thesis.

HYG's intraday signal is slightly leading, its 3C charts are positive on the 3, 5 and even the 10 min timeframe, not long divergences, but there and in my view,  in a market like this there's only 1 reason to see positive divergences in HYG- as a ramping lever.

TLT has been leading today, but it is starting to lose its lead over the SPX and of course the TLT charts have negative 3C divergences on 1, 2, 3, 5, and even 10 min now. Again, shorter term in nature and size, but also a typical signal for a ramping lever sending yields higher and they act as a magnet for equity prices.

Speaking of yields, the 5 and 10 year are roughly in line with the longer 30 year lagging because of the outperformance in the bond, but this can change overnight and I almost suspect it will.

Our professional sentiment indicators that have been leading the market to the downside well before last week's move lower (this is why we call them leading indicators), look apathetic today, they are close to in line, but the point is their weeks of pure downside moves are apathetic today, more lateral, a short term change in their character.

High Yield Credit has much better relative performance than it has shown recently and the PIMCO HY fund is nearly perfectly in line with the market.

The SPY 1, 2, and 5 min chart now have positive divergences. The IWM 2, 5 and 10 min charts have positive divergences, this looks to be the strongest and should have the best relative performance vs the other major averages.

The QQQ 1, 2, 3, 5 and 10 min charts have small positive divergences.

The intraday TICK breadth is improving as you can see below.

TICK custom indicator vs SPY.


I see some positive  atempts in Financials and Tech.

XLF 3 min, yet note the size of the current positive next to the former negative

As well the 10 min XLF chart is very negative, I'd want to be VERY careful trying to trade this long, personally I wouldn't.

And the 60 min chart leaves little doubt which direction this will ultimately take once short term head fake moves (which are not certain, but a high probability) are done.

Now I'm going to try to get to individual assets and see if anything looks interesting.

Quick Futures Update

Despite the early gains in the averages shrinking since just after the European close, there are positive signals in the daily charts, while not all yet at traditional reversal (bullish) candles, as I said, there are promising signs (in the context of the IWM bounce/head fake scenario we have looked at).

As for 1 min charts, like this morning there's little of note or excitement...

 ES 1 min in line, positive, in line, nothing too exciting.

 Similar NQ 1 min action with a more clear negative intraday divergence at the intraday highs, but otherwise very similar.

 And TF with its own chart, but the end result the same, rather dull intraday 1 min charts.
At the 5 min charts, this is where we have had a deficit of positive divergences to bridge the ones on 7 min charts and bring the market to action as HYG, TLT and VIX futures are suggesting as well as other assets, the short term oversold condition, short term oversold breadth and the general concepts of head fakes and mass psychology.

On other 5 min charts, Gold is about in line, Crude oil is as well as are ES and NQ index futures,  however take note that these could flip to positive 5 min charts easily overnight with strength in the 7 min charts.

 ES 5 min nearly perfectly in line just as NQ mentioned above, however,  the one average I expect to lead, the IWM/Russell 2000 has a much different looking 5 min chart.

TF 5 min Russell 2000 futures, clearly positive.

With just about all index futures positive on the 7 min chart, as I said, the 5 min chart could go positive between now and the overnight session in a snap, thus these 7 min positives are of interest.

While I don't have a great feel for the 4th ramping lever, USD/JPY, I can see that there's some 5 min and 7 min 3C weakness, which would help USD/JPY higher and the index futures along with it. $USDX divergences are much less noteworthy, but all that is really needed is a weakening Yen to push USD/JPY higher.

ZB/30-year Treasury futures are also negative in the 5 min space, add that to the signals in TLT.

And VIX futures are negative in the 7 min space, also to be considered with the earlier VIX update/s. Thus it's still the 5 min charts that are the only thing that I'd want to see before making any decision as to whether piggy back longs are worth the risk. However as noted earlier, the 5 min chart can and often does go positive in a short period, often during the overnight session and don't forget tomorrow we have the F_O_M_C at 2 p.m.

While I'm not going to presume to have any idea what the F_O_M_C policy statement will look like or the market's reaction to it unless a clear leak is obvious as we have found on about 3 occasions, I will remind you as always, BEWARE THE F_E_D KNEE JERK REACTION AS IT IS ALMOST ALWAYS WRONG.

While the knee jerk reaction is typically faded within hours to a week or two, it is nearly always faded meaning the initial move is often the wrong move. Seeing the recent developments since late last week, I find it interesting they are coming to a head the day before the F_O_M_C, right about the time the market expects the Santa Claus rally and among still bullish sentiment within the "Buy the Dip" crowd with manipulation lever assets coming on line like Yields/Treasuries, HYG, VXX and possibly USD/JPY with a weakening JPY.

It could be that no matter what the F_E_D says, they've already set up the market to respond favorably and market participants will buy that no matter what the F_O_M_C says if they see prices moving in the correct direction, THUS WHILE I HAVE NO PROOF THAT OUR ANTICIPATED IWM HEAD FAKE MOVE IS LINING UP TIMING WISE WITH THE F_O_M_C, IT WOULD MAKE SENSE BEING THAT THE INITIAL KNEE JERK COULD BE THE STRONG MOMENTUM THE IWM NEEDS TO MAKE THE BREAKOUT AND THE FACT THAT THE KNEE JERK IS NEARLY ALWAYS WRONG AND FADED, WHICH IS WHAT WE EXPECT TO HAPPEN TO THE IWM AFTER IT HAS MADE ITS $118+ BREAKOUT ABOVE THE 6 WEEK RANGE.

Gold Update

In this update I'm not considering the longer term probabilities in gold except in passing, I'm more focused on near term probabilities as we do have an open trading short in GLD which is near break-even despite some strong gains last week that had it at a bit more of a loss, it has come back nicely to us.


There are a lot of dynamics in gold right now, the big one is central banks buying it up, notably China.

Typically gold is bought on expectations of inflation, note I said "expectations", meaning before inflation has already started as gold is a natural hedge against inflation. However, as near sited as it may or may not be, inflation expectations right now officially are lower than the F_E_D would like, which is not being helped by lower oil prices.

This is the current GLD short position, down about a half percent so not bad at all.

In 2011 after a near perfect uptrend since QE started which caused inflation initially, we had extensive gold analysis and called a top at the highs of 2011 and further called an Intermediate to primary downtrend to follow, this was a very unpopular call at the time as EVERYONE was a gold bug. I even had non-investor friends buying gold and silver off the Internet, which as I pointed out to them were fakes to some extent as gold coins are struck from a single piece and these had a clear seam at the edge in which two separate sides of a coin were joined. 

Whatever their real gold/silver content I have no idea, but they were not authentic coins. I mention this just to illustrate how insane the precious metal frenzy had become and thus calling a top in gold was not a popular thing to do at the time, but not only was it correct, the years following also proved our primary downtrend correct as well.

 The yellow area is where we called the top in gold based on 3C charts and a dramatic change in price's rate of change to the upside, remember changes in character lead to changes in trends and seemingly bullish moves are often red flag warnings that something big is about to change as we recently forecasted on a smaller basis with BABA's Channel Buster upside move.

I suspect the descending-looking triangle through the last year and a half or so, is a long term base in gold getting itself together, but this is another subject for another time.

 Note the daily Sell and buy signals in GLD and their following trends. Also that GLD was below long term support at the buy signal. Gold had outstanding performance on the week last week, but I suspect our short trading position in GLD will hold its own.

 This appears to be long term capitulation or a selling climax at the yellow arrow. As I often note, this doesn't mean there's no more downside or that an upside reversal is imminent, it just opens the door to a new base and usually sees additional downside in reaching that new base area. This concept holds true for nearly all selling climaxes or "Capitulation" so I'd keep it in your tool box (the way the asset acts just after).

 The daily chart in GLD with the buy signal from our custom indicator at the lows (white trendline).

The long term 4-day GLD 3C trend shows confirmation of the uptrend in to 2011 and a clear, large negative divergence in to the 2011 highs followed by downtrend confirmation and what looks like a large year+ base in the works.

I don't want to get caught short when this moves, but I don't think it's there and GLD short is a trade, not a core position.

 The 60 min chart seems to show much recent improvement, although very recent problems near term, that's what I'm looking to trade with GLD short.


 The 30 min chart adds more color. Note the positive divergence at the same time our custom buy/sell indicator based on DeMark principles gave a buy signal at those exact lows. Since though, we have seen a near term negative divergence and it has sent GLD down off last week's lofty run.

The 5 min chart gives even more color to the near term expectations with a leading negative at last week's highs suggesting they were used to sell in to. This may be because GLD will drop back as equities bounce as we expect and not be used as a flight to safety asset or it could be in response to tomorrow's F_O_M_C in which any change of language toward deflationary pressures or diminished near term inflation expectations could send gold significantly lower quickly, the trade I'm looking for.

 And the 2 min chart adds more color, again, distribution through last week's very strong performance.

As for confirmation among Gold Futures...

 The long term weekly chart holds the same positive long term bias as GLD/3C charts do in the long end.

The 4 hour chart shows accumulation at lows and a building positive chart so I do think gold and likely gold miners do resolve to the upside ultimately, but I'm more interested right now in more immediate trends.

 The 60 min gold futures 3C chart show the same distribution in to last week's highs as the charts above, suggesting we do have additional near term lower prices making our gold short look like it will be a profitable endeavor.

The 5 min chart is in line with the recent losses off last week's highs.

When I see a reversal and a probable move building to the upside in near term trade, I'll update gold again, but for now, I expect near term weakness to continue and our GLD short to profit from it.