Opening Action

I'm glad to see this morning's market action, I prefer see the envisioned scenario earlier than later in the day, giving the market enough time to get it self together and make the move higher envisioned in one of yesterday's possible forecasts with a head fake move below the SPX's 200-day moving average.

Since the Greek Finance Minister's (new) meeting in Belgium in which he came empty-handed, it seems this was just what the market needed to get us down to the SPX-200 day and fast.

 ES / SPX intraday futures take a sharp tumble from overnight price action as seen in the A.M. Update.

Taking a closer look, this isn't the kind of confirmation or positive divergence  was talking about in to a decline below the SPX's 200 sma today, but it is good to see at least the start of a plausible positive divergence considering we are this close to hitting the target area...

The SPX daily chart and 200-day moving average which is at the $2055 level, price has made an intraday low of $2055.19, the psychological level would be $2055 or maybe even $2050, so we are closer this morning as we expected yesterday than we have been all year.

Things to watch for other than divergences include a sharp increase in volume on a break below the 200-day and TICK divergences to the upside.

We might just have the exact number of the market, but either way I see this as a no lose scenario. The speculative long positions are so small at this point that a break to the downside would be profitable as the core short positions are all at full strength. An exact head fake scenario would allow us to add additional long exposure once the market proves itself and if that scenario doesn't pan out, but a bounce still does, we still have some exposure to it, which means some gains before closing them and letting core positions take back over on the downside. In my view it's really a no lose scenario and possibly a perfect entry.