Quick Market Update

If you have sent me an email in the last hour or two, I'll get to it ASAP, right now I'm bouncing back and forth between the market, BABA, NFLX, USO, the $USD, Euro SPY, IWM, QQQ, Index futures NON-STOP.

I'm also finishing a USO post, the punchline is I'm holding the USO short and Put and "MAY" add to one of the positions. That post will be put next right after this as it is almost finished.

We expected market weakness early today, it was posted several times yesterday and in the Daily Wrap so I'm not surprised, but I will be honest and tell you this market looks a lot worse than I'd even expect considering VERY near term expectations of some more bounce left off the move that we forecast mid-last week and started on Friday.

Right now the most telling indication for a market reversal off the early weakness and back toward a bounce is actually in the VIX related ETFs, like VXX...

 VXX 1 min negative intraday divergence. You've seen the unusual underlying strength in VXX (see yesterday's VXX post) so to see any weakness even intraday suggests the market is starting to get its act together off the early weakness.

This is the 2 min VXX chart showing yesterday's unusual strength mentioned in the update, VIX, VIX Futures, VXX, UVXY, XIV  and again in the Daily Wrap and a negative divergence . Remember VIX normally trades opposite the market so a negative divergence intraday in VXX suggests near term market strength building to finish out our bounce.

 This is the 1 min chart of VIX futures, note the relative negative divergence but more importantly the recent , fast, deep leading negative divergence. Suggesting market strength is brewing and perhaps that BABA call position is near to being ready.

 Last week I mentioned that the Russell 2000 was showing the best underlying (3C) charts (strength) and should lead in relative performance, this 3 min intraday chart shows that and I have alerts set for a break under support as that would be an interesting intraday head fake timing signal, perhaps even worth some IWM calls for a very speculative, short term trade.

 XIV which is the inverse of VXX and trades WITH the market is showing an intraday 1 min leading positive divergence confirming all of the charts above.

In addition, Index futures are starting to go positive...

ES/SPX futures

NQ/NASDAQ 100 futures.

TF/Russell 2000 futures.