However, take last night's Dominant Price/Volume Relationship, one of the most overlooked objective data points,
From last night's Daily Wrap
"Close Down and Volume Up, a short term oversold signal as I mentioned before that often leads to a bounce the next day and often beyond."
From that one data point we not only rose from the early gap down ashes which 3C pre-market on the Index futures predicted in the A.M. Update, with an opening positive divegrence and upside recovery...
On the whole averaging the averages, we had a green day today, even though the headline I see most tonight is "Dow Closes Down for 6th Consecutive Day", breaking a streak not seen in 14 months, still a good 182 points off the morning lows!
While only 1 of the 4 averages hit yesterday's lows this morning (I would have preferred them all hit yesterday's lows to show stronger accumulation) , that average, the NASDAQ 100 also showed some of the best intraday work on the positive divegrence, it were those positive signals and the work being done to establish a strong bottom in the NDX which led me to chose the QQQ for an initial Call option position entered today, Trade Idea (Speculaltive Options Call position) QQQ.
I started last night's Daily Wrap with,
"Looking at the market from yesterday's perspective, I entered some partial positions based on the fact I expected, “
So today's market action with the exception of the IWM, fit nicely in to forward looking expectations for the day, which were also posted Wednesday before the close with closing divergences all suggesting a lower open in every average except the IW
Also form last night's post,
"The R2K ended the day with a bullish Engulfing Candle just a little bit after I had said I was considering going long some leveraged IWM ETFs,"
We also talked about VXX and VIX futures distribution last night, with spot VIX posting a strong downside reversal candle yesterday and today (remember the VIX moves opposite prices)...
IF YOU ARE A NEWER MEMBER, YOU ARE PROBABLY FIGURING OUT BY NOW THAT WE DON'T FOLLOW LAGGING INDICATORS LIKE MOST OF TECHNICAL ANALYSIS, for instance a moving average or MACD is a lagging indicator, it has already happened, WE FOLLOW UNDERLYING TRADE, WHAT SMART MONEY IS DOING WHICH WILL ALWAYS GIVE US AN EARLY HEADS UP, THE CHALLENGE IS DETERMINING WHERE THE HEAD'S UP TURNS TO ACTIONABLE TRADES, but I'd much rather have an idea of what's coming than follow price around led by the nose.
Like yesterday, again the Dow Transports lead the Industrials, a Dow Theory divergence with transports up +1.12% leaving the two looking as follows...
In green the Dow Transports led the Dow Industrials lower until recently as they have led the Industrials higher if you are a fan of Dow Theory confirmation.