September 9.

SPY is up by 0.93% at the open

9:30 Opening SW +1816, Slope +10.

9:44 QQQ has gapped above its resistance, which should be important. I'm watching it to bounce off them.

9:45 UPDATE SPY MP flat, Liquidity shows selling, VXX MP up. SW +1545 and Change +1. It should be noted, that /ES has tested the previous resistance levels pre-market.

9:47 The fact that we have passed the previous resistance level is pretty important, a much worse case scenario would be a flat open or a very small gap up. 

9:51 I wouldn't mind a gap closure or a partial closure with a bounce off the previous resistance levels. It is better than tight range trading decline.

9:56 Eyeing the liquidity right now and how well the SW would hold. SW +1198, so...not so well.

9:58 There is a fine line which limits any potential for an upside reversal on the /ES - 1984. Unless that level gets broken, there is nothing to do on the long side. On the opposite, if by any chance the current highs would get taken out, I would have stop limit orders all over the place above them.

UPDATE 10:00 SW +1170, Change -19. Liquidity/SPY MP down, VXX MP up. No clues in the indicators so far, except for the weakening SW. I wouldn't be surprised to see new lows at this moment.

10:05 New lows, I think they've run a program.

10:07 Yep, three small sell programs. SW +998, Change -28.

10:16 The decline continues, little bounce on the Liquidity and SPY MP. SW +698, Change -43.

10:17 There is a clear descending resistance line on the chart. What usually happens, is that it gets broken with a fake-out reversal, that forms a second descending resistance. The break of the second one is usually powerful.

10:19 SPY has retraced ~ 70% of the gap. One could start fading it aggressively at this point.

10:20 QQQ has retraced to the resistance levels right now.

10:21 Aggressive /ES trade with 2 points at risk.

10:23 VXX MP spikes lower, tests down.


UPDATE 10:30 SW +808, Change -38. SPY MP lower, Liquidity flattening. My stop on the /ES is just below the 1 hour range...seems reasonable IMO.


10:35 With the negative change, the profit target should have been smaller. Stop loss triggered.


10:36 Small sell program took out the 198 stops. Seems to me as an extension in this move down. DP's spiking up a bit, Algos continue flattening, so as the MP. Small decrease in VXX MP.


10:38 Price tests yesterday high, long /ES once again.


10:38 Further leg down in Algos followed the price.


10:39 Given the Primary and current ranges, I would be fading moves out of 60-m range back into it.


10:51 Three consecutive down 30-m bars. I am almost 100% confident in a reversal.


11:07 The gap has been covered, SW +98 and Change -60. Consolidation.


11:08 The lows have been very consistent today, which is reflected by the way they match the bottom channel line. The first upper channel has been already broken, so I extended it to the last high. This type of behavior sets up a reversal after some consolidation/last extension.

11:11 Option portfolio sold some volatility calls with next week's expiration. Might be just an intra-day, partially or fully.


11:12 Price breaks out into the 60 minute range. 198.27 SPY is the line to watch.

11:14 Liquidity shows decent buying and SPY MP is turning up. VXX MP had a large extension down into the lows, but it's thin today...so that's why.


11:16 It would be nice to see liquidity UP today...would support this up cycle.


11:17 Further up-tick in SPY MP.


11:19 A visible squeeze in the price. SW +321, Change -49. Algos are selling into the pop.


11:25 Multiple sell programs push price back into the lows. SW +135, Change -58. However, liquidity shows BUYING INTO THIS PUSH!


11:29 SPY ranges via channels

11:39 Price broke the green channel, resistance at the purple channel right now. SW +279, Change -44, SPY MP testing down, Liquidity in slight decline, DPs sellers.


11:40 So far, we are seeing lower highs which "smash" the price into support. Steve Hammer suggests that a support break would bring in lower ranges - could be true, but then, I've seen so many times a fake-out which runs the stops, only to quickly reverse before the actual move up. Price breaks support.


11:41 The thing about these two days is the ridiculous buying into the close yesterday. If they were willing to do so yesterday and saw higher prices today, they will buy in more into the same "yesterday's" prices.


11:42 SPY MP spike lower, Algos continue selling. I would really like to see some consolidation on the accumulators, or buying into the lows, or an extension without a corresponding price movement.


11:49 Yep, that was a program that ran the stops. SW +103, Change -53. 


11:53 Algos testing down, SPY MP down, DP's selling more. SW -48, Change -60.


11:59 One of my indicators suggest that we just saw the LODs...this is just for the reference.


UPDATE 12:00 SW +110, Change -45. MP down to flat, Liquidity down and flattening. 30-m looks interesting:

12:07 A fade into the previous close followed by a strong bounce. Algos are very flat for the past 15 minutes. SW +86, Change -47. But I'm getting more and more confident.


12:08 An extension bar which caused an up-tick in liquidity, DPs reversed to buying during the past 15 minutes. MP continues down.


12:16 More extension bars, price is at descending resistance on the /ES. This looks like an another afternoon reversal, I don't think we will see lower lows today. The SW and Change are concerning, but in the current environment, SW could get above +1000 with ease.


12:21 Price TESTS resistance. SW +360, Change -33. MP continues down, Liquidity is supportive. Spike down on VXX MP.


12:23 This is the second time price tries to get back into 60m range and it got stopped out in the same price level. Should break.


12:30 Three solid up bars and it breaks the resistance. SW +347, Change -29. MP continues down, Algos flate.


12:43 Slight retracement and going up again. Liquidity higher, VXX MP spike lower, SPY MP slower lower. SW +297, Change -32.


12:45 There are two ways out of this situation: 1) They squeeze price a bit more, then run the program. 2) They let price retrace a bit lower to bounce, and then the upside move would continue.

12:49 While price is falling right now in a stronger squeeze, there is continued buying on Algo and spike down on VXX MP. I'd give it 20-25 minutes given the time right now.


12:54 They drop it lower, but LIQUIDITY INCREASES INTO THE DROP.


UPDATE 1:06 SPY MP has reversed a bit, continued buying on the liquidity, SW +177 and Change -33. There is at least 1.5 hours before the slope could turn, but if that happens, any long positions should get released...meanwhile, SPY moved lower with consolidation and is now grinding higher, as expected.

1:09 Another spike lower on VXX MP.


1:10 I think this 30-minute bar will define on where we are going next.


1:14 Still seeing this consistent  upside consolidation with higher lows...it typically explodes after a while:

1:15 VXX MP continues lower, SPY MP slightly higher, liquidity up to flat. SW +97, Change -37. An extension bar up on SPY which has matched the descending resistance line. Price is in a doji, should be going in 2-3 mins.


1:21 Up move continues, here's the VXX MP

1:24 Quick retracement lower, but liquidity doesn't respond.


1:26 They've ran a program, lower low. SW -24, Change -43. Liquidity doesn't react however, and take a look at VXX MP once again:

1:29 Price tests LODs...new lows... VXX MP still continues down...I still see this as an extension on price...


1:41 Price is lower. VXX MP IS AMAZING. ALGOS ARE BUYING IT, DARK POOLS ARE SELLING IT...IF SOMEONE KNOWS SOMETHING, THAT WOULD BE THE DARK POOLS (C) STEVE HAMMER. TOTAL DUMP OF MP INTO NEW LOWS ON SPY, HOW DO YOU LIKE THIS DIVERGENCE?

1:45 And VIX futures are not higher into this noticeable S&P decline; previous time of the low is market with the vertical red line.

2:30 Slope change down confirmed, SW - 960 and the Change -60. DPs are buying into the highs, Liquidity lower/SPY MP lower, VXX MP begins to slowly rise from the lows.