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On days when it feels like nothing is working and you're on the wrong side of the market, it's good to question your thesis and expand your chart time frames.  Take a look at your positions and sizing to see if  there are any problems or if you should reduce or even add.  When the recent downside exhaustion signals started to trigger on all sorts of indexes/sector ETF's, and stocks I did work examining which wave they were occurring and it was clear the 3rd wave and a lower high 4th wave was ahead.   I purposely have kept a high percentage of cash available and have preached to be nimble.  Sentiment has been improving in the past two weeks and that's a positive yet the three big potential negative catalysts have not been removed from the picture.  Headline risk remains with China, Mueller, and Syria.  Examining the reaction to various stocks after earnings has been valuable too.  I've been cautious on financials and short Goldman Sachs.  Earnings last week started with the financials and the reaction after the earnings was a big old sell the news.   Goldman reported decent earnings today and it has sold off from the open and now down 2%.  Netflix reported great earnings and the stock lifted 9.5% inline with the implied move.  It's powered the markets higher and the narrative on CNBC is clearly on NFLX gains vs GS losses.  

Recognizing all of this is an important exercise to gain the confidence to stay focused on the job at hand which is to manage risk the best you can with the information you have at only this time. 

Notable:

• US Markets - A strong day thanks to NFLX.  Ignored is how JNJ and GS reported OK earnings and they are selling off.  Some tactical shorter term 5th wave targets in sight.  
  
• Hedge Fund Telemetry Trade Ideas - Doubled up the 4 ETF's short to 5% each, Added NFLX short
  
• European Market - Quietly these are improving
  
• Asian Markets - Japan likely another lower high.  FXI downside exhaustion yet Tencent looks lower and that's the largest weight so hold off
  
• Bloomberg World Index - Another lower high in the offering
  
• FANG and NFLX to the rescue
  
• Real Estate ETF VNQ - Continue to like this on the long side
  
• Bond Update - 2/10 could start to steepen in the coming days
  
• DeMark Screens - Daily, Weekly, Monthly upside/downside exhaustion signals within the S&P 1500 and Euro Stoxx 600
  

SPX bullish sentiment is at 40% and likely will make a run for 50% later today
Here's a link to the Hedge Fund Telemetry market sentiment page with 40 charts of sentiment including equities, bonds, currencies, and commodities updated each day.   

SPY continues up in the 4th wave and today back above the 50 day moving average.  I continue to see this move as another lower high bounce that will be followed by a lower low.  

The shorter term tactical 30 minute time frame is now in its 5th wave and this is the main reason I added another 2.5% to each ETF short.  

Nasdaq bullish sentiment is at 44%

QQQ has bounced and is in its 2nd wave of 5 to the downside.  This too should make a lower high followed by a lower low.  

30 minute of the QQQ hit the upside 5th wave price objective today.  

The Dow also should make a lower high followed by a lower low.   

IWM Russell 2000 had a green Setup 9 yesterday and some consolidation should be ahead.  This index by far has looked better than the other indexes recently.  

Trade Ideas:  Recently when I put on the four index ETF's short, I hope I was pretty clear I had less conviction at the time and I chose to limit the exposure to a minimum 2.5%.  Today, I doubled these four to bring them to a 5% weight each (this is my max size).  I also added a 2.5% size short in NFLX today.  See below for charts.  For the month, I am now down 14bps on 58% gross exposure.  I have a lot of flexibility to add more.  

German DAX had a very strong day and didn't give us the consolidation back to the 50 day.  

Same story with the Euro Stoxx 50

DXJ Japan ETF also is in Wave 4 of 5 and now has a Wave 5 downside price objective of 49.48

FXI Hong Kong China ETF has a downside red Countdown 13 today however Tencent gives me some concerns

Tencent the largest weight in Hong Kong, FXI, and EEM for that matter, has a downside red Countdown on day 4 of 13 with a downside Wave 3 price objective of 365.  When I showed the upside exhaustion signal in March with the downside price objective, I had a subscriber tell me that would be something to see.  Well, we are getting closer

One more index I see a lower high is the Bloomberg World Index.  The green Setup 9 should have some consolidation ahead

FANG + Index is having a strong day today yet is very far away from making new highs.  

NFLX had a 9% implied move and it's up now 9.45%.  Yesterday I felt the upside potential was there with the upside Countdowns as well it's rare to see so many analysts trip over themselves to upgrade and raise estimates right before the earnings release.  

NFLX on a shorter term 30 minute chart is on bar 8 of 9 with a green Setup.  The Setups have been good at inflection points.  I'm taking a shot on this one with 5% risk.  I have to believe a lot of weak shorts have been taken out of this and that could cause a vacuum lower if there is some risk off catalyst.  

VNQ is having a good day today although its faded off the highs.  I like it long with the upside Countdown on day 6 of 13.  

Bond bullish sentiment is at 47% and despite the recent action in bonds sentiment remains relatively bid

US 10 year yield has a muted move today despite the upside in the equity market

2/10 Yield Spread has been flattening yet today there is an exhaustion signal and a reversal is highly likely.  

HYG High Yield has had a nice move off the recent lows and now is on day 8 of 9 with a Setup.  Expect consolidation or reversal in coming days

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