From yesterday: "I still think some 1-2 day drop is the more likely move...."
There was some genuine damage today, as SPX had rejection under its MarR2 level, DIA & YM fell back under MarR2s as well, and NYA does look more like rejection from 2HP and Q1P level. The latter is the more bearish development, because both SPX and INDU vehicles remain above all pivots. NYA however, tried to reclaim long term pivots and so far failed.
So what to do? If you were following along you might have come into today with a starter short on XLF (or ready to enter) and a speculative long on VIJ6 which did quite nicely today and helped limit the damage. As of yesterday I thought bearish sentiment too thick to really press shorts/hedges and maybe that was incorrect. Depending on your agility in the market, you could have decided to reduce long exposure from the open today, although often it can save headaches to wait for the close for signals.
Buy TLT? 1st hour bar above WP, and unlike 3/22 not stalled on a daily level. Sure, TLT still above 3 pivots, only below monthly. Admittedly tougher decision at the close since moved from 1HR1 support to Q1R2 resistance.
Sell DIA? Eh, just a minor fade from MarR2! Better to short / hedge on weakness and hold the winners imho.
Sell SOXX? Same idea, above all pivots!
Short NDX? No, better was adding shorts via IWM below 3 of 4 pivots and first to drop under its WP from near the open today. Or add to XLF short from yesterday.
Sell EEM? Tough call, rejection from 1HP but still above Q1P. Could have hedged the open via weaker FXI.
Sell oil / EWZ / RSX? If in from 2/12 hopefully you already had some gains locked in before coming into today. Oil CL1 contract Q1P rejection and still below 3/4 pivots, so that is err on the side of taking gains (opposite from DIA & SOXX positions). EWZ 2nd failure at YP; caution warranted. RSX first failure at YP, but high volume rejection that looks valid. Look, if you take all or most of the gains on the oil and related ETFs at this point it has been a very nice ride and soon we will be sure to see more other entry chances on the Q2Ps.
Bottom line market was at a place where a pause was more likely, and I recommended VIJ6 at the YS1 as a hedge and was focusing on weaker indexes to hedge the leaders DIA and SOXX. XLF dropped but quick glance at hourly charts and short term levels screamed add hedges on IWM.
SPY, DIA, XLF, VIJ6 and TLT below.