Another Triple Swing Negative TICK And Momentum Divergence

August 4th gave us yet another powerful example of the “Three Push” Reversal trade in the SPY and @ES futures which was confirmed with a ‘three push’ divergence both in the momentum oscillator and more importantly in the TICK.  Let’s take a look.

As the SPY formed the (so far) highs of the day, it did so on three symmetrical ‘pushes’ or up-swings in price that were NOT confirmed either by the 3/10 Momentum Oscillator or the NYSE TICK.

When price makes a higher high yet an oscillator or the TICK forms a lower high, this is a non-confirmation and signals that a retracement swing is more likely yet to come soon.

However, when price forms three higher highs and then we see a double-swing TICK or Momentum divergence as seen above, then this is a glaring non-confirmation of the higher prices and sets up the “Three Push” Reversal trade, in which we can play for a potential full trend reversal on the day instead of the small retracement ’scalp’ that a normal divergence would forecast.

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