While Greece did not implode over the weekend, the European alliances , especially with the US seemed to suffer soma major initial blows that are likely to grow deeper, for instance Cyprus will; sign a military cooperation deal with Russia that will put that Russian base in the Mediterranean , ultimately that's Greece's trump card as the Russians made clear going in to the weekend, funding to help Greece is available if they are asked. Beyond that the Minsk meeting/summit opened or revealed fractures between the US and key allies, Germany and France.
As for futures, there's some downside on the opening of Futures for the new week, here are the initial trends I see developing.
As for Index Futures, I don't yet see this as a imminent turning point, but after Thursday and Friday's very fast, very negative divergences, it's apparent this could happen very fast.
Here are a few timeframes showing the trend...
Given the strange, very fast, very negative action started Thursday in XLK/Tech and naturally QQQ as it is tech heavy, the NQ 1 min futures which I normally wouldn't pay too much attention to on a long overnight session, make some sense to look at especially because of the other timeframe trends in NQ over the Thursday /Friday period when signals went from bad to much worse in Friday's strange signals.
NQ 1 min showing Friday's cash market in white and a negative divegrence in to the opening of NQ's chart tonight.
This 5 min chart of NQ is much more along the lines of what I
'd look at, in fact I won't trade an average/Index unless I'd trading in the direction of the 5 min chart in Index futures, thus the leading negative divegrence in NQ through Thursday/Friday (in white below) is obviously of some interest. While I'd normally doubt an extended fall just from normal price action behavior from here, there is a small positive forming right now, but in the big picture of the charts I'm showing you, it's not a defining feature.
The strong move lower of TLT Friday on the Jobs data sent yields higher which is supportive for the market, still the Dow/SPX lost green for 2015 by the close, I showed TLT on Friday and how it (and VXX to a lesser extent) look to be putting together a positive divegrence, thus TLT up or in this case the 30 year Treasury futures, yields down and pressuring the market lower. This is essentially confirmation of the signals developing in TLT (20 _ year bond fund) seen Friday after the drop/gap lower on the strong jobs print. This is an important lever for the market, thus this positive signal is an important chart for us.
TF-Russell 2000 futures on a 7 min chart which is a timeframe I have respect for and pay attention to are showing a VERY clear negative divergence (leading) through Thursday/Friday of last week where we saw the very extreme, very strongly negative signals starting Thursday in tech and QQQ, then spreading Friday to almost everything else and much stronger. This is another way of seeing that same action on a consolidated chart through the two days.
CL/ Brent Crude Futures 7 min looks to be right about where I expected. I do think there's plenty of gas in the tank for further upside, but just as we said last week, as soon as everyone started calling a bottom and Cramer nearly top ticked oil with his "I smell a bottom" comment, we expected oil to consolidated which it has done since then, this chart would suggest there's still some consolidation to do which seems to be through time rather than through price, either way, it's right in line with our expectations and given how quickly retail went from bearish to calling a bottom on the start of a move, I suspect they'll be fully bearish right as USO/Oil is about to make another leg higher, but we will verify accumulation of the consolidation as always.
This is NQ (NASDAQ 100) futures, 10 min. Again, there's a very clear change in character, a very sharp negative divegrence through late last week, Thursday and Friday especially. This is not 1 or 2 charts, but so far a trend and those days specifically in which we saw what I'd even call unusual activity/signals, very fast, very sharp, very strong.
The 10 min R2K futures shows the same, but more importantly...
The 10 min 30 year Treasury futures shows the positive divegrence which sends yields lower on a price move higher and pressures the market lower, this is over all good confirmation through multiple timeframes and multiple assets.
There's still that small positive that looks like it may hold up overnight above on the NQ 5 min chart, but in the big picture of just the charts shown above, it's nearly irrelevant, perhaps even helpful.
I hope everyone had a fantastic weekend is is ready for the new week. I'll see you in a few hours!
