Bullish Divergence on TRIN and Put Call Ratio Oscillators (Emini daily)
The Emini closed down 3.00 points at 1,314.75 today. I almost wasn’t going to trade today, expecting low volatility going into tomorrow’s FOMC announcement. But the market started heading towards 1,300 in after hours. We ended up with a 23 point range day and high volume.
Although the Emini closed down, the adjusted TRIN reading was +101, showing underlying buying. In addition, both the TRIN and Put Call Ratio Oscillators have turned up – and they are showing bullish divergence patterns. See the chart below.
We had a nice short trade signal around 1,325 with a combination of volume and Hilbert Sine Wave patterns.
Volume Upthrust Pattern (Emini 5 minute)
The volume pattern was an upthrust into previous resistance on lower volume. The lower volume shows there is not enough “energy” to break to new highs and follow through. Stops are triggered and a reversal follows.
End of Trend Signal (Emini 5 minute)
This volume pattern coincided with an “End of Trend” warning signal on the Hilbert Sine Wave. We also got a signal on the low of the day with a similar pattern:
- “End of Trend” signal on 233 tick chart
- Cycle low on 2,097 tick chart
- Exhaustion volume on 1, 3 and 5 minute charts
You can read an article about this multiple time frame pattern here. Good luck with your Emini trading.