The SPY put-call ratio jumped to 2.67 today. Normally that would be enough of an extreme to hit the ratio’s top Bollinger Band, but that’s just under 3.0 at the moment. A ratio of 2.67 is still high enough to be a contrary indicator.
Gold tried for a downward breakout from its pink megaphone and failed. Instead, it turned the attempt into a triangle (blue in chart) that broke out upwards today.
A retest of the blue triangle top would be a retest of the pink megaphone VWAP, and would make gold legal for an upward breakout from the pink megaphone.
Gold has a mandatory retrace target at 1375 (call it 134 and change on GLD). An upward breakout from the pink megaphone ought to get it there.
ES has a dozen things going on right now in its short-term charts, but the most important one for the moment is a rising wedge (navy blue on chart above).
First, rising wedges that form during an options expiration (today was the expiration date for quarterly index options) tend to lead into a bigger move up.
Second, the precise turns on the sides of the wedge tell you that nothing important is going on. There is no ma and pa panic selling, no big money scramble. All that’s going on is bots and technical traders moving the price around as options get closed out or rolled.
The ES short-term megaphones are now legal for upward breakout after a dip to the formation VWAPs last night. But you’d often see ES and SPY take another dip to an old lower VWAP (1942.75ish/194.90ish) and the orange price channel bottom before breaking out (green scenario on chart).
ES and SPY will only get to the ES 1969-1970/SPY 197.50 area before a retrace to the 1952.50/195.80 area. Then they will be free to take off for the orange price channel top.
ES and SPY have still not ruled out a break through the orange price channel bottom (light blue scenario on chart) leading directly to a large correction.