A.M. Update

It's shaping up to be what could be a very interesting morning.

As I noted yesterday, my ideal situation didn't require a gap down, however a low around or below yesterday;s intraday low was important, this was the drawing of what today might look like for the market to have a decent 2-day base it can bounce through the SPX 100 m.a. with.


From yesterday's Extremely Close...

 "On the daily SPX chart, this is what I'd like to see happen tomorrow (the yellow candle I drew in). It doesn't really matter where it opens, whether a gap down low below today's intraday low or up higher, so long as there's an intraday low lower than today's, that would run stops and allow for a better looking base, a more stable base before breaking above the 100-day moving average which it's just below."

So far this morning it's looking like a gap up opening, but that's still fine with the scenario laid out above, in fact there already looks to be evidence the market will come down shortly in Index futures...

 NASDAQ 100 futures intraday 1 min negative divergence and even stronger...

Russell 2000 futures 3 min intraday negative divergence suggesting the theme above is a decent probability.

As for oil, I may look to reopen the put closed Thursday after Friday's call was closed for a double digit gain. API inventories last night came in at a draw of -6.7mm bb vs previous build of 1.8mm bbl. However it's the Oil futures chart I'm interested in.

Crude futures since yesterday's API report, remember  the EAI petroleum report is due out at 10:30 this morning.

I'll of course post any trade ideas that might be entered, I'm going to give the charts a little more room to feel reasonably certain.

As for treasuries, interesting last night PIMCO posted on their website that they cut their UD debt holdings by 2/3rds in light of deteriorating fundamentals in the form of a F_E_D rate hike, bringing their holdings of UST's down from 23.4% to 8.5%, however last time PIMCO slashed UST holdings, they rallied months later. In this case the selling of such a large position was not done overnight, this is likely what brought us below the long term trend line in TLT well over a month ago.

Thus I don't feel any different about TLT, in fact it may be helpful and this morning as I'm still waiting for the exact entry in TLT, 30 year Treasury futures are looking interesting.

Intraday positive divergence in 30 year T futures, it has been more the timing charts I've been looking at with Treasuries/ TLT.

Finally the BOJ's Kuroda told parliament that the Yen is, "Unlikely to weaken further" . This sent the yen rocketing higher...

 Yen Futures

With JPY pairs like USD/JPY getting hammered. However for some of the trade set ups like oil, it's interesting to note...

The $USD is hanging on at an area of temporary support here as it drifts back down to a natural support area, however briefly, it may be helpful in some trade entries.

I'll be back after the cash open with an update.