Volatility Up!

Our second call for a buy response was correct, and they gunned it to yesterday's range highs today.

Except for the fact that they did it in a manner that foretold a reversal:

1) Morning move up was way too fast, elongated.  Moves like these are prone to reversal, as we have seen time and time again.

2) Momentum diverged at a the minor high zone of yesterday's range highs.  And this minor high, like so many of them, fortold a push lower down to range lows.(Hello crystal ball!)

After the lows were taken out, yet another fascinating TO THE ABSOLUTE TICK mind you, reversal at S2.  And the TICK was south of -1200!   To think that one of the largest financial instruments in the entire world mechanically reversed at this simple and obvious reference -- despite major program selling readings -- never ceases to astound.

Clearly, the trade of the day was to go long the excess tail at S2.  Volatility was up and the subsequent rally from lows was almost a whopping 20 points.  

Given the mechanical low, and the prior two days of poor downwards structure we've previously pointed out, this market is good to go higher tomorrow.

That's the high odds bet.

Let's dig into some intra-day screen shots to highlight the trading metrics!