Whiplash

As the quarter ended yesterday so did all sense of temperance apparently because once everything is in the books, the market can apparently get on with doing the things they don't want to be seen in  the books just quite yet.

The Great Carry Trade Unwind is likely one of those events because it means stocks that were financed with carry trades will be sold.

In any case, the overnight market was not reacting to ADP, it likely wasn't even reacting to volatility caused in the USD/JPY pair itself. My guess is the market was reacting to the free hand it had now that Q1 ended yesterday.

USD/JPY overnight...

Things were largely ugly, although very VOLATILE,  which if you recall was the one thing I was looking for even more so than the actual bounce!

ES/SPX futures saw that volatility as well, but they look to be a little more predictable as the divergences showed up there before the price moves so I'll be watching that as close as I can while trying to get other things like trade ideas out.

Right now it looks like we have a negative divegrence in ES, it just formed over the last 10 minutes or so, as you can 3C just turned down.

However I'm not going to be whiplashed and forced in to positions because the market is acting volatile, it will throw its tantrum, but it will give us the high probability/low risk trades.

There are several events that could trigger more volatility including a phone call between Greece and the Eurogroup, there are noises that it could produce an agreement, but apparently creditors have come out and said that's not happening, so who knows beyond the Greek Finance Ministers's very mature threat that Greece would adopt the incredibly volatile Bitcoin if they didn't get a deal.

Now that the cash market is open, after they run the normal stops in the morning, things should calm down a bit. Remember it was the volatility more than the bounce that I was looking for to get us to the next leg of the stage 4 decline or the next lower low, but I don't think we are quite there, although I won't even try to hide that the last two days this week have seen obscene amounts of distribution.

More in a few minutes...