Just a few minutes to the close

I still don't see any strong objective evidence other than if you were taking the 30, 60 min and 1-day leading negative charts and entering a position on those, but I think we'll likely get better timing. As to the close today though, there's nothing that points to "Picking up where we left off".

I see no reason to take unnecessary risk.

Have a fantastic weekend!

TLT Update

This is an excellent example as to why I stick to objective evidence which are the probabilities or high probabilities offered by the charts.

Earlier today as the TLT position went again our put since the overnight session on a small 1 min , 1.5 hour divergence, I posted the charts and the reason I said, "The TLT June 19th Put position is still in place, today has been an interesting bit of movement, but I am not concerned about it." Posted today in the: TLT Position Update

Since then, the short term charts have fallen in line with the longer term , higher probability charts which is the exact same concept I just explained in The Week Ahead,

"Just remember, the 30, 60 min and 1-day ES charts in the post linked above from last night and earlier today are the highest probability resolution and they are calling for a drop in the market and not the corrective kind either."

As for TLT...

It looks like the 3, 5 and 10 min highest near term probability charts are winning out as the 1 min intraday chart quickly went negative as TLT tried to make additional upside gains and then came plummeting down to what is now just above yesterday's close.

I'm still not worried about TLT puts...

The Week Ahead

Earlier today I posted the Preliminary "Week Ahead" with my opinion of what looked likely to happen, this is largely based on concepts we have seen work over and over in different timeframes and different assets.

The gist was that this week's expected "Rounding/Igloo top" with the typical last move seen before a reversal , the head fake "Chimney", was judged too earlier to have taken place as the natural rounding over pattern was distorted by Tuesday's losses, thus the price pattern originally expected to play out this week, finishing the rounding top, actually likely took place. You can read the entire post here, Preliminary "Week Ahead". However the revised price pattern looks like this...

Note how the price pattern looks much more like a rounding top when Tuesday's decline is taken as part of the pattern rather than the end of the pattern. Furthermore the head fake "Chimney", which is where I want to enter watch list shorts that look more ready now than they have in some time as the market has been in an exceptionally tight range, never took place.

I would normally consider entering some short term trades based on the expected move to the upside and then close that out, enter the trend shorts and some longs and let the market take care of the rest, but as seen in this market update...Market Update, you can see why I'm so loathe to enter anything at the moment as there is no objective evidence or overwhelming objective evidence supporting the theory above,  that's not to say it won't develop early in the week, but until it's there, I don't see the advantage in taking a gamble.

For every chart that suggests a trade, there's another in the same average or a different average that negates it, at least for now.

However a quick look at leading indicators and there are some hints that the theory above for next week's action may see the market give it a shot. I believe if it takes place with a head fake move above the rounding top (the Chimney), it will likely be finished before Friday so it would likely have to happen fast unless somehow Greece achieves what they haven't been able to all year and get a deal with the Troika as the looming IMF payment is Friday, there's no more money and if it is missed, they are in default.

I don't see traders as willing to stick around to see how it plays out.

Granted, these are not charts that are blaring sirens for the scenario above, but they do suggest an attempt, whether successful or not, I believe we'd have to see charts improve rapidly early next week or manipulation on a scale we haven't seen and that's a tall order.

Some of the Leading Indicators...

 The SPX:RUT Ratio custom indicator (red) vs the SPX is not confirming the SPX's price move lower today, this has been a reliable short an medium term indication at divergences with the averages.

We haven't seen Yields act as a leading indicator for months which is a shame because they were so effective, but this week they seem to have acted exactly as that , they gave up their correlation with the market and have led it like the magnet they use to act like.

If I'm correct on TLT coming down, that means yields up and if yields are, at least for now once again acting as a leading indicator, they'd lead the market to the upside as they have led it to the downside this week.

Finally, as I often say, "The first lever they reach for to manipulate a market is High Yield Corp. Credit"

This is HYG which has been in line short term with the SPX in green for the week, but notice the higher highs in HYG vs the SPX.

Again, these aren't smoking guns, but they are some unusual standouts in this week's/today's market and the "Igloo/Chimney Top" concept has been a solid one.

At present I don't see anything that's reliable enough or even close to take any risk over the weekend, but I'll continue to look in to the close and we'll see first thing Monday if it develops.

Just remember, the 30, 60 min and 1-day ES charts in the post linked above from last night and earlier today are the highest probability resolution and they are calling for a drop in the market and not the corrective kind wither.

The Financials Story...

I try to (and don't have to try hard) to make it a habit not to listen to CNBC, there's a very good reason for that. However every once in a while like on F_O_M_C days I'll tune in to listen to the policy statement or the press conference and I invariably end up hearing more than I intended to, usually because I'm too busy to turn off the TV on those days.

This story that rate hikes will be good for financials is about as bunk as they come. Are we talking about extra income from nonexistent mortgages? Loans for Cap-Ex spending when no one is spending on Capex during 6 years of ZIRP? I'm not even sure the banks know what their business model is anymore once trading dried up.

In any case, Financials have been one of my favorite long term core shorts and I fail to see how a 25 basis point hike or even a 100 basis point hike is going to turn things around for them after watching the way they use add backs and the such for reporting earnings that stink to high heaven.

In any case, most of that is opinion, that's not what I'm about, the charts are what matter. When I write the third section (final) post in the "Understanding the Head Fake Move", I suspect XLF/Financials will be one of the example charts that ties it all together.

 Like the SPX and other of the major averages, this is  as close to perfect as you get in creating a head fake pattern as every technical trader knows what a triangle looks like. The head fake move would be above the apex (yellow) and there it is.

To confirm though, we need the charts...

 This is the 2 hour 3C / XLF chart, I think the signal at the breakout/head fake is pretty clear.

The 60 min chart is a very strong timeframe, but more detailed. Once again, it's pretty clear to see what happened.

 And the 15 min chart is more detailed, not a drop of confirmation, in fact the exact opposite.

Coming back around from the short term charts' trends...

 The 1 min trend not only negative at the false breakout but perfectly i line on the downside with any counter trend corrections shot down.

 The 2 min trend needs no commentary.

However, as I said back then on April 2nd, what I find interesting is that these price patterns that are so well known, were not naturally occurring...

This 5 min chart shows distribution at the top of the triangle trendily to make sure it doesn't go above and small accumulation at the lower triangle trendily to make sure it doesn't go below. These were not random;ly or naturally occurring, they were put there for a reason and that reason is on the first chart above in yellow.

For this and numerous other reasons, Financials are one of my favorite core short/trend short positions.

Market Update

Here are the charts from the last intraday post, but I think in them, you'll see why I'm not too terribly excited about entering short term positions at the moment.

IWM

 This morning's 1 min small, positive divergence at the capitulation lows, again 45 minutes before any Greek news hit the wires. To the right, the leading negative divergence is obvious.

This has sense migration or strengthening to the 2 min IWM chart

And the 5 min chart as well.

QQQ

1 min intraday negative to the far right as just posted...

as well as on the 2 min chart.

These are not huge divergence in and of themselves, more or less intraday movement.

However...

This QQQ 5 min is clear reason as to why I'd be very careful about going long anything without the proper chart support, if anything it looks quite negative.

SPY

1 min intraday with a small positive at the lows and a leading negative hitting new lows right now.

The 3 min chart is in line.

There's a very small 5 min SPY positive, but with the other timeframes so mixed and the other averages, I would never consider this high probability.

As for the intraday internals, the NYSE TICK shows the market breaking down since this morning's intraday lows...

You can see the channel (up) off the intraday lows has been broken on the downside.

Furthermore...

Our custom TICK indicator shows the intraday flameout around 10:45 at the yellow arrow, about an hour before the Greek news. However since, the intraday internals have deteriorated at the white arrow as well.

Again, I think you can see why I am patient here in not chasing any trades as there's little to no objective evidence to support a short term position, although the evidence supporting the longer term trend trades is there, we just need the timing charts to fill in which I suspect happens before Friday's IMF payment is due. This is based on charts.

Quick Market Update

Since this morning's flame-out/short term, intraday selling event we've seen pretty steady upside, however that is now turning intraday and I suspect shortly we will be seeing a turn back to the downside. How big of a turn depends on how much larger the intraday divergence is allowed to become. It looks pretty close to turning soon though. I'll have example charts up in a couple of minutes...

TLT Position Update

The TLT June 19th Put position is still in place, today has been an interesting bit of movement, but I am not concerned about it.

Here are the charts for TLT/30 year Treasuries which if you recall, on a larger trade basis, I believe will make a counter trend rally, but we'll have to confirm that upon a decline first before entering the position in any size.

 You might think the move in 30 year treasuries this morning was based on the GDP second reading, but unless it was leaked and I'm not even sure why that would matter because it came in better than consensus even though reduced to a negative print, there was a small 1 min positive divergence after the close yesterday, not really looking like much , but moved 30 year treasuries through the entire overnight session, not simply at what you might expect, the 8:30 GDP release.

The 1 min TLT chart shows a similar positive divergence, although quite small in to the last hour and a half of yesterday. Today it's simply in line.

However I'm not concerned about TLT coming down as it is the more serious, stronger timeframes that the idea is based on and there's not much gas in the tank of a 1.5 hour 1 min divergence.

 The 3 min TLT chart with the base I suspect that will lead to an eventual counter trend move, however first there's a strong negative divergence to the far right and that's what the TLT put position is based on. Nothing there has changed.

The same leading negative divergence is on the 5 min chart as well which is even stronger.

 And on the stronger 10 min chart.

This is a closer view of the current divergence on the 10 min chart.

What I'd be looking for to enter/add to a TLT counter trend long trade would be the pullback/decline that the charts above are forecasting and look for signs of accumulation of a constructive pullback in to the decline, then I'd feel a lot better about a second, longer term TLT long trade, but that depends on this first one wrapping up which I am not too worried about it doing.

Preliminary "Week Ahead"

Unless I see something that causes me to revise this post before the close which may be the case to a small degree, but I don't think to a very large one, this is more or less what I'm expecting.

After looking around at the watch list assets, there are charts that I have been waiting to see movement on, entering the trades before now would have just been dead money in most cases. Transports are one that I'd like to get another crack at, we've had two entries in core shorts for transports, if we can get some price strength, a final one would be nice considering how ugly they are.

Taken with last night's Futures update in the Daily Wrap and what I'm looking for in different assets including the $USD, I think this is the most probable outcome for early and later next week. I think we are finally at the cliff's edge.

Last night's futures update had a lot of multiple timeframe analysis charts, but in Index futures, the short to intermediate term charts were sloppy and scattered, it was the trend charts that were very clear, making it hard to know what to expect in the very short term, perhaps continued chop, perhaps a pop higher with the $USD setting up nice watch list short entries in to better prices and lower risk.

 What does seem clear is that massive trend damage is done (Breadth reflects the same) as was posted in last night's futures update linked above, the 30 and 60 min Index futures via ES, but there's one even worse that was not posted, the 1-day which is the strongest underlying trend timeframes.

 ES 30 min leading negative as posted last night...

ES/SPX E-mini futures 60 min leading negative as posted last night, but sometimes I assume you remember what the 1-day chart looks like, this is the most important and I shouldn't assume so here it is...

 ES 1-day with massive underlying trend damage done through 2015 on a worsening basis.

Looking at the price pattern for this week, I was expecting (from last Friday) a rounding /Igloo top, then the head fake Chimney. It seemed with Wednesday's decline that the Igloo portion or rounding portion was cut short, but the Chimney never materialized.

Standing back with a couple of days more perspective, I suspect this entire week has been the rounding top/Igloo price pattern...

The area right at the SPX triangle's resistance is just about right. If we include the earlier damage and today, we get the exact rounding top I would have expected. The Chimney/head fake portion would fall to the far right and I suspect early next week.

It's not the charts that bolster this view, in fact it's the lack of strong charts in the 1-15 min timeframe of futures that bolster this view with a very strong set of resolution signals on the 30, 60min and 1 day charts.

The normal logic would be, "go long" for early in the week until the transition where we enter core/trend shorts, however while I think this is a probability, I'd preface that by saying I think the probability is the attempt, not necessarily success in the head fake/Chimney portion.

If I see strong intraday charts develop that support this view and make a trade worthwhile, then I'll post that, but I don't make trades based on gut feelings , I make them based on objective evidence and so far there's little to support strong, successful short term upside trades.

I see the probabilities and the strength in shorting in to any attempted price strength next week or individual trade signals. Just because a market will likely try something, doesn't mean it will succeed. I'd feel much better about short term longs if there were strong short term signals to back up those trades and as I showed last night and am telling you now, there aren't many at all that I'd even consider speculative.

We do have some time left in the day and perhaps they develop early next week, but the SPX chart above is what I believe will be the highest probability with the attempted chimney head fake move being the last event before a drop to the downside which lines up well with the $USD analysis from last night too.

More to come as I uncover it...

Quick Market Update

Interesting... at 11 a.m. we had identified a likely bottom that had taken place about 10 minutes earlier.

The TICK confirmation we were waiting on came shortly after...

By 11 a.m. TICK had confirmed, but the intraday lows and move up off them is being attributed to a Greek claim that next week's IMF payment will be made with no mention of how and a full 45 minutes later!

The sheeple of the market can't stand anything more than a 30 second soundbite to make the market seem understandable and less frightening. In any case, someone needs to lose for someone to win so that's fine.

As for the market itself, I think last night's Futures forecast was more valuable than even I might have first thought, see last night's Daily Wrap at the bottom for the full report on Futures.

It seems quite a bit of what was posted from futures analysis last night fits well with the watch list assets that I'm looking for entries in as longer term core positions rather than these short hit and run trades. There has been a good deal of movement these last 2 days which also fits with the forecast from last Friday, Igloo/Chimney.

 QQQ intraday. This doesn't appear to be an accumulated stop-run, but it sure felt like one.

 very short term timing charts are saying, "hold", be patient , but not for too much longer.

 If the small amount of damage from last Friday could do what it did Tuesday, then this additional , much larger damage is looking like our spot.

QQQ 15 min as another example.

Again if there are decent , worthy looking short term trades, we'll take what the market offers, but this is looking much more like the big opportunity we have been very patiently waiting on as most traders seems to not be sure which way is up right now, not only from comments I've been sent from other sites via email, but the AAII Investor Sentiment from last week shows the exact same, bulls and bears the most confused they have been...

May Have Hit an Intraday Low

This is very interesting activity for an op-ex Friday, it seems the macro economic data is being taken very badly indeed, everything either missed this morning or came in poorly despite not technically missing.  Ironically GDP which received quite a downgrade, came in above consensus.

The real Greek default D-Day is June 5th, it seems a little early or perhaps late to be de-risking for that event, I suspect this has more to do with month end Window Dressing.

In any case, it looks like an intraday bottom may have been made.

 The volume and candlesticks we look for to indicate an intraday flameout or selling event (mini capitulation) in the SPY...

The Q's

And IWM.

Confirmation should be found in a break above the NYSE intraday TICK index's channel which looks like it's coming.

I'm not sure I'd fade this move quite yet, lets see what, if anything tradable develops.

Early Update

Well can you believe that, the second revision of Q1 GDP comes in and nothing reacts except some bonds, which I suspect will be a limited reaction. Of course the F_E_D has already inoculated itself from any and all Q1 GDP weakness as transitory and the actual print of -0.7 was better than consensus of -0.8 down from +0.2%. Just remember, if there's a second consecutive quarter of negative GDP, the US is in recession. I highly doubt the data massagers will allow that by a long shot.

Things look a little more exciting this morning than the usual Friday options expiration, but I suspect they'll calm down soon, as far as the averages go, keep a close eye on volume/candlesticks for the intraday flameout as well as the TICK intraday channel.

Oil bouncing on a weaker $USD right now is no surprise, this update from Tuesday night had called for exactly that, USO / Crude Update.

If you saw yesterday's The $USD and USO / Oil then you probably know I don't believe oil's move to the downside is over, I see this as more of a gap fill before heading lower.

Gold is also gaining some traction, but showing some interesting mixed charts so I may take some trade management steps or may just let things smooth out a bit, we;'ll see how they develop.

It does look like the $USD is weakening a bit more, it may be that it does until later today or Monday with a final push before rolling over.

Right now things feel very transient (this morning), as I'm writing I see TLT is already coming back down and SPY/IWM look to be losing downside momentum and will likely start turning lateral within the hour.

I'm going to take this time to continue going through some watch lists, I have alerts set so if anything interesting pops up I can get to it quickly.

What an economy and we are looking at hikes? I know there have been a lot of answers to this question, but I can't stop asking it, "What is the F_E_D really afraid of?"