Market Update

I've posted my opinion on what the market is most likely to do this week, BEFORE Friday when it's D-Day for Greece. The broad strokes were posted in last Friday's The Week Ahead forecast, then yesterday I posted more detail in several market updates and finally in the Daily Wrap.

I'll say, if there is actually a plan as I suspect and as I have posted, THIS IS BY FAR ONE OF THE WEAKEST EXECUTIONS OR SET-UPS OF SUCH A PLAN. 

Normally even for a decent 1 day bounce we have strong enough divergences to tell what's likely. This market has barely given up anything since last week and I suspect that is because there are few on Wall Street (pros)  willing to take on even the smallest, shortest term risk these set-ups almost always display.

Taking a look over the market this morning and watch list stocks, it's very hard to stay patient and not throw a bunch of watch list trade ideas out there. You saw how weak the Transports chart was so early in a well deserved bounce. I think that while I shall continue looking for additional evidence pointing to the path of near term price action, I may be better served or better serve you by simply continuing to go through the watch lists and throw out ideas as they look mature. Usually I'd want the market and the asset to line up at the same time, but there's so little support in the market for any kind of move that it's nearly impossible to determine what the market might be up to beyond the original idea from Friday which is based on a strong concept we see more often than not and no real evidence to argue against that concept. That is hardly the same thing as even very short term cycles of 1.5% that have shown stronger set-ups. 

Obviously, in my opinion the market has all but abandoned risk assets and is not fond of throwing even 1 or 2 day minor support behind them.

So far here's what we have vs what has been expected which can most easily be seen in the first paragraph of the The Week Ahead post from Friday, however last night's Daily Wrap adds much more detail and color.

 Daily SPY chart with the flag I've mentioned to the far right in red trend lines.

Here's the SPY flag on a 15 min chart. I suspected we'd see a stop run below the flag's lower support trenndline before a move to the upside to fulfill or attempt to fulfill the "Chimney" portion of the price pattern before failing. We did not get the move below support, not to say that we won't and not to say that we need to (the yellow arrows are what I expected to see near term today), in any case we are not far off.

 This is the 1 min SPY trend, the last respectable (and they too were small) divergences were at Friday afternoon on the 22nd and at the lows that followed at the 26th. Since then, 3C has more or less been in line with price. This is what I mean in saying there are so few to no divergences to support even grief, short term price action.

 The intraday SPY 1 min chart is just kind of stalled here, but since we have seen some upside movement as was expected upon a break below the lower channel of the flag-instead it just found support there. Even with the price action picking up as was anticipated in our Igloo/Chimney top-price pattern, there's no 3C support (at least not yet) to even come close to confirming.

 The longer term 5m chart also shows only 2 relevant divergences, the 22nd (neg.) and the 26th (pos.), otherwise, the best we have seen is in line with the decline in price.

 And the SPY 10 min chart I wanted to see continue to deteriorate , continues to do so.

 The enduring and most important chart just like the ES/SPX futures 1-day posted yesterday is this SPY 1-day, also leading negative. It will be hard to impossible for the market to overcome the probabilities that are laid out on this chart, they are the highest resolution probabilities and they are pointing to a massive downside move.

 There's not much difference in the Q's or IWM, nothing that makes a difference.

Keep an eye on the intraday NYSE TICK. If the market starts showing the same weakness in the Transports charts, things could go south faster than anticipated.