Daily Wrap

Good morning.

I see our gap held fairly well overnight, but trading action was subdued overnight in Index futures. If there's one thing that keeps coming to mind it was yesterday's warning that the IWM could still bounce from lower levels.

Looking at the charts this morning, with such an overhead gap, this seems like a fairly plausible scenario. Whether or not it is a worthwhile scenario for IWM-specific trade entries, I don't know but it could be helpful with other assets.

Again like yesterday there's no definitive FX signals, but I get the feeling USD/JPY could bounce here and support the market for a gap fill attempt.

 $USDX 1min slight positive divergence 1 min

 Yen futures 1 min negative divergence, which would bounce USD/JPY.

 ES 1 min futures have a small positive divergence as well, but this isn't what's all that interesting to me.

 It's more the 5 min charts like this NQ 5 min that had a sharp/deep leading negative divergence, price caught down to it, now there's a small positive/bounce divergence.

And TF/Russell 2000 Futures are still holding a 5 min positive divergence/bounce signal.

I wouldn't be surprised to see that bounce today that I was looking for yesterday. Strangely once Wall Street is set on a cycle, whether a month, a week or a day, they rarely give up on it.

In any case, we went over all of this yesterday, the only difference being as I said yesterday,. "We could bounce from a lower level". I still don't expect anything more than the typical noise bounce, but it may be useful here or there.