I believe most technical analysis is dubious.  I heard a saying on Fast Money, the other day, that the ships at the bottom of the sea are full of  charts.  None the less, I do believe divergence to be a reliable short term indicator.  There are some notable divergences showing up on my weekend screen before the latest Greek Drama and bank closings.  They are as follows:

Dow Jones Transports Index has been getting pummeled.  This probably has more to do with the collapse in crude oil and the weakened prospects of moving it by train than a general economic slowdown.  It is showing bullish divergence and any change in sentiment on the prospects of moving crude by rail could launch its member components a quick 5-8%% retracement from 8242.47 Friday close to the 8742.61 200 day moving average.

The 30 Yr US Treasury is also showing bullish divergence.  The Fed hasn’t done anything to change interest rates other than talking them up.  It’s been very effective and the long bond is taking a beating.  Expect a sharp reversal Monday setting up a good trade to buy TBT on the sell off in time for this July 4th holiday weekend shortened jobs report.

The bloom is certainly off the rose on the Australian stock market but it’s ETF EWA is flashing bullish divergence.  Australia’s market is very tied to China and commodity driven. The currency is weak vis a vi the US Dollar and I would avoid.  If you think the opposite, now is a good time to go long.

Regional banks as expressed by the ETF KRE have been on a tear.  This could reverse Monday for a brief ride down as the market filters in the fact that central banks may have to keep interest rates and lower for longer to stabilize the potential of GREXIT and the surging US Dollar.

Real estate in the “real” world is staging a strong comeback but REITS in the stock market have languished.  The crowded trade shorting anything interest rate sensitive might be overdone as the Vanguard REIT ETF VNQ looks like it could have a powerful bullish contra move.

Interest rate sensitive utilities could also enjoy a brief bullish respite as seen in the bullish divergence of XLU. Unfortunately for the beaten down MPL sector, the downward trend seems intact.

But as the old saying goes, buyer beware.  One piece of significant news can wreck a lot of chart patterns.