UPON FURTHER REVIEW

A funny thing happened yesterday, a legitimate sell signal developed in the stock indexes. For all I know this is another false setup, there have been a ton of those the last 6 months. This one I like due to the nature of it being a trap pattern, a false break to new lows that immediately reversed. This chart is the inverse Russell 2000 ETF, RWM. Of course the futures contract is the inverse of this, showing a false breakout up. We do also have the momentum oscillator diverging positively, and the seasonals favoring down. All in all worth a swing and it is a trade I am in.

Here is something else I noticed yesterday that for some reason I had missed, not sure how I missed it.

I was contemplating a long in Silver until I looked more closely and found that there was actually a triple divergence in the oscillator. These often trigger very big moves and if you are watching Silver and Gold today you are seeing one. It bears watching to see what happens here. We know these are monster air pockets in the near term. I have to admit that I am not short here yet, I am hoping for a bounce to enter. It would not surprise me at any moment to see this collapse at least for a short term sharp down move.

I have also noticed sharp spikes upward in the ADX in quite a few markets. This indicates to me short term blow off tops have formed, so I would be cautious of long side trades in most markets in the near term.

Short but sweet today I am pressed for time