Market Update

Usually a head fake move has some proportionality with the preceding price pattern it is breaking out or down from, in this case triangles for the most part, symmetrical and/or 90 degree.

I have expressed in recent days some doubt as to how long a head fake move could hold out given the nature of the very weak internals, 3C charts, Leading Indicators, etc. I still believe that when we are at the pivot, the charts will be exceptionally clear and there won't be guessing like, "Is this close enough?".

However, considering today's move and yesterday's VERY odd movement in the underlying flow of funds, which looked like the towel was just thrown in and rather than using the typical ramping levers, the "invisible hand" essentially just put actual money to work to try to push the market around which is exceptionally rare...from yesterday's post and the motivations on the subject...

My sarcastic, "I wonder why" was definitively answered today.

Now as to the underlying price action in what is otherwise even from a basic technical analysis (dogma) perspective is a flawed move at best....

This is the NYSE E TICK index

You can see the earlier uptrend and the extreme reading of +1750 on absolutely no news, but this was expected and then the deterioration as there was a lack of follow-through and right now a very mild range of-250/+750

What is unique about the charts below is not that they are longer-term charts that show the strong underlying trend, what is unique is that they are the short term charts that respond very quickly and don't take a lot of accumulation or distribution to move. It would follow that if there were a breakout move with institutional support of some kind we would see confirmation in the very fastest of our 3C charts as they moved up with price.

 SPY 2 min leading negative. Not even close to confirmation in fact the opposite.

This was the strange timeframe yesterday that I have noted several times since it was posted yesterday and it is moving toward a relative negative divergence. Remember that to flame outs at 2 PM on Tuesday and 10 AM yesterday morning which were expected to be the two areas that the market would get a toehold for an attempted breakout .

 The larger Institute I'll time frame at five minutes shows a complete lack of confirmation, This chart could easily confirm within an hour. The price pattern we are left with as we have been forecasting for a week as an example and probable price pattern…

Since the "W" base going into early April and the April 2 forecast as well as the previous weeks forecast of a reversal process/Lateral price trend, it's starting to look a lot like an igloo with a chimney price pattern. See the September 2014 highs going into the October lows, it is the exact same price pattern and one that we see most often.

The actual head fake or chimney is one of the best price based timing and indications we have for a reversal, in this case to the downside.

 The QQQ two minute chart could have easily confirmed within minutes, instead it has diverged extremely today.

And the odd three minute time frame from yesterday in QQQ which inspired this post, Unusual Market Activity-I Wonder Why... It is starting to deteriorate.

 IWM one minute leading negative in a lateral area which is most common to see a accumulation or distribution, think of VWAP.

 The two-minute IW and chart showing yesterday's 10 AM flameout, a mini capitulation event based on breadth and a deep leading negative divergence into today's move.

Again the point being these are the fastest time frames that could and should easily confirm.

And I WM three minute which was also one of the strange timeframe just today showing confirmation in the early move and deterioration now. This is the concept of migration of a divergent as it gets stronger it moves to longer-term time frames with more extreme divergences. into a head fake event

The initial information looks to confirm our forecast of distribution into a head fake event over the last week plus. This does not mean we are at the exact pivot, it just means our expectations are moving in the correct direction and positions can be taken as they come available.