USO Update

 This shows volume picking up on probes below the trendline so this trendline is being watched and traded.

Here are several negative divergences off resistance and the last one off USO's attempt to move higher.

Either 3C is going to have to give us a positive divergence and/or a move in USO back above the $39.80 area. It's not uncommon to see a shakeout before a move through important resistance, but at this point, there's not a lot to go off except what we see right now. This is still a guessing game and as I said, I like probabilities. I'll keep you updated, at least we haven't seen a waterfall sell-off when USO broke support.

GDX Request

 GDX-compared to GLD (in red)-miners have underperformed gold itself for awhile now, note GLD making higher highs and GDX topping.

 The 30 min 3C shows accumulation at support of the top  and confirmation of the uptrend, but some cracks are starting to appear.

 Here's the 1 min chart, suggesting the distribution process is underway, remember that these run in cycles of accumulation, mark up and distribution into higher prices.

There may be a little more upside in the next few days as distribution occurs into higher prices, but the 15 min chart is falling out of confirmation now so I doubt there's too much more upside here.

SLV

This looks like it's going to be a serious pullback

Market Update

It looks like we are going to get a pullback intraday here shortly.

The 1 min charts remain negative and the 5 min charts are not confirming the move up this a.m.

USO

 UUP (Dollar) daily chart. Considering the drop in the dollar today, pretty much every commodity I've looked at including the commodity index, seems to be severely underperforming.

 Here's USO daily only up .30% on a nearly -.80% decline in the dollar index, a total lack of relative performance.

 There are two possible price patterns in USO, the descending triangle which has a bearish slant, I question this one though as there was no volume on the upside breakout on this hourly chart.

 The second would be a more bullish Inverse H&S base price pattern in which there has been no breakout. A breakout of either pattern should produce volume, so it may be this is the correct price pattern to look at. I will point out however, my volume analysis of this pattern is not confirming an Inverse H&S, the volume is wrong.

 Here's the hourly 3C chart which appears to be bullish and suggests an upside breakout.

 The 5 min chart has shown negative divergences, especially at the breakout point on Wednesday. There's also a current negative divergence on the test of the morning highs today.

Finally the volatility is tightening which would imply a highly directional move is coming shortly. I would not jump to judgement on a break below this trend line as we often see head fakes before a real move (up) starts, but if it fails below this trendline and can't get back above it within a reasonable period of time or f prices drop like a water fall, then I'd be wary.

For now, It's a wait and see game. I wouldn't rush into any large positions as there are just too many contradicting factors. We want high probability, not best guesses.

SQNM/VRML/VICL Follow up

SPY

First I want to cover the SPY, the first market update this morning showed what looked like a pullack off the opening negative divergence, but the 5 min chart was still in line, so the assumption was either pullback or some sort of consolidation. Remember that the market largely moves together. 3C is not yet in confirmation on the 1 min chart, but is making progress.

SQNM

 SQNM 5 min showed a negative divergence on the open, so a pullback here is reasonable.

 The 15 min chart shows a decent positive divergence and combined with the price pattern, suggests there should be more upside in the SQNM long trade.

 Although the 22 bar m.a. on an hourly chart is a little tighter then I'd like, it's not a bad proxy for a trailing stop. I'd prefer that this stop was used on a closing basis, but you have to make that decision according to your risk management plan/entry.

VICL

 I warned several weeks ago to take profits in VICL and that we'd take a look again on a pullback, right now it's there and thus far, it looks to be a good risk:reward trade here. The white box area is where I'd prefer a stop, although you'll have to decide what works for you risk management wise. I certainly don't want a stop right at $3.50, so I'd suggest either being tighter or a bit below $3.50 as it's a very obvious level for stops to congregate.

 The 15 min chart went positive into the pullback, suggesting that it would see another leg up, although I do feel this may be the last leg before a more substantial consolidation.

 The VICL 5 min chart is also positive into the pullback, this is what I was looking for in a pullback and it appears VICL is just getting started.


VRML

 Another consolidation, similar to VICL's

It looks like there was a head fake break yesterday, the 5 min 3C chart was positive at the break. As I often state, we almost always see some sort of head fake before a move higher and the positive divergence at the head fake looks good to me, it appears this is the start of the move in VRML.

 This appears to be the head fake, note the volume and now the move toward resistance. I'd like to see volume pick up crossing resistance -actually, just checked and it is above resistance on a good volume move.

 Here's the hourly positive divergence,

And once again the 5 min which seems to indicate the start of the move in VRML-especially given the head fake that just took place.

Spain

This is a pretty familiar sight across much of the world these days, but I think it's important to feel the tension, the under currents and discontent that is spreading across Europe, largely due to austerity measures. When we consider the depth of emotion and rage, we have to think about the position Greek and other PIIGS politicians are under to implement policies that are internally, tearing their countries apart. Furthermore, the effect it's having on EU intra-party relationships in which certain countries are now re-institutting border controls. The EU project is unravelling and may very well make our Lehman Brother era look like happy days.

I ended up in the middle of a couple of protests unintentionally, once on a vacation in which we visited Washington D.C. right before the 2nd Iraq War started-that was scary, to turn a corner and see 500 riot police queued and ready for deployment and the second time while visiting the Hungarian Parliament. Ready for this? The Hungarian museum where they keep relics of the Soviet occupation actually left an intact, real Soviet tank in place. All the protesters had to do was put in some fuel and they were driving a tank down the street!

Anyway, in this clip, the Spanish police are playing what is probably the most downloaded I-phone App in the country, Whack-a-Mole.

The market is acting as I expected, but this isn't the good news it may first appear to be to some bulls.

Remember, patience and picking and chasing our battles is our greatest edge over Wall Street.

USO Update

Things change fast, I guess this late day chart of USO I posted at 3:18 was useful

Chart of a rapid change in the 1 min 3C from yesterday afternoon

 Here's yesterday's late afternoon divergence, this morning the gap up is yet to be confirmed so we may get a little pullback or consolidation shortly.

5 min USO, as far as the pullback that was signaled in red, yesterday looks to have been the extent of it.
Thus far the 5 min chart is in line or showing 5 min confirmation.

The Open

The Dollar is Down, just about everything should be up. That shouldn't be a surprise,  I've been writing about the dollar decline since Tuesday.

New Tool For Risk Management

Some of you may like this, you'll need Worden's StockFinder to use it, but I know many of you are already using it.

If you want to look into some great charting platforms, check Worden's out at these links and don't forget to tell them that Brandt from Trade-Guild sent you

And you can go here for TeleChart information
For FREE Realtime Charts, this is the best platform I've seen and it's true real time, no delays like most free charting software. There's no gimmicks, the real time feed is paid for with small adds on the sides of the charts which you don't even notice.
Here's my new risk management tool

If you have read my risk management link   then you probably know that I advocate not losing more then 1-2% of total portfolio value (before margin) on any one trade. There's also a more conservative approach in the article linked above. Typically we do this by figuring out 2% of or portfolio, and divide that by our entry price less our stop (risk), which will give us the number of shares we can buy and not lose more then 1 or 2% if we are stopped out (position sizing).
The difficulty or wildcard is opening gaps which can be unpredictable, there's no way to protect against an opening gap that slices right through our stop out level. So I asked the guys at Worden to create this indicator which I then created several more indicators based on it. 
In the first window at the top, we have the chart of our stock, ETF, average, etc. In white we have the biggest gap (either up or down) over the last year. You can see with APPL, up until 1/14/2011 the biggest gap we had seen in AAPL had been 19.45 points (dollars), after that and currently, the biggest gap we've seen in AAPL has been $21.43.
In Yellow, I've turned this indicator into a "Market Indicator". The yellow line represents the median gap in the S&P100 over a 500 day period; the median gap for the S&P 100 is $3.89.  The Red line represents the highest 1% average gap in the S&P-100 over a 500 day period, which comes in at $21.43. Remember this is the biggest average gap in the top 1% largest gaps for the S&P 100 over a 500 day period. The Green line represents the smallest 1% average gap in the S&P 100 over a 500 day period.
I find the first indicator the most useful. I now know what the largest gap has been and I can position size according to that gap. For example, I have a $100,000 portfolio and I am willing to risk 2% per trade ($2000) so I now know that the biggest gap I'm likely to face is $21.43 ($2000/$21.43= 93 shares// 93 shares * $335=$31,155. 
If I'm trading the Index through an ETF, I might want to use the median gap. The Index can be changed too, so you can get the median gap for the NASDAQ 100 if you trade the QQQ's of for the S&P 500 if you trade the SPY, etc.
You can also observe how volatility has risen historically which may help you decide whether you want to risk 1 or 2% of portfolio value on a position. In AAPL's case, when it was trading at $134 in July of 2007, the largest gap was only $6.86. Now we are trading 250% higher, the expected gap at similar volatility would be $17.15, but it is actually $21.43 so you can watch trends in volatility as well.
I'm sure there are many things you can use this for if you think about it, I think it's useful information and if you have StockFinder, let me know if you'd like to try the layout.