VERY IMPORTANT POST- Experiment Results

There's little doubt in my mind that arbitrage effects the market, divergences, CONTEXT to some degree, but I think the degree to which they effect the market largely depend on where the Yen is and what it's doing, at least for now.

The Yen alone cannot account for all of the market correlation, but it does account for a large part of it. In my earlier post when I fist figured out the Yen was having a larger impact than previously thought, I put a number of different timeframes, not only are the long term Yen charts accumulating, but the shorter term ones are now too for an upside reversal.

Take a look at the evidence.

 This is the Yen Futures and 3C for today, the green arrow is the 9:30 open, the Yen falls shortly after on a negative 3C divergence, in the early afternoon the Yen accumulates and rises around 1 p.m. or just before, then another pullback, but this time still on a leading positive divergence and an attempt to move in to the close that didn't go far.

Now take a look at the zoomed in closing trade, the red arrow is where the market moved up late afternoon, the yellow arrow is where I hoped to see the Yen move up and the market down, it didn't move that much though.

Now the Yen in red vs the DIA, click on the chart to enlarge and look close, the same minute the yen breaks under support (red trendline), the SPX breaks out to the upside, just before 1 p.m. when the Yen reverses, the market loses ground. I said I saw small positives near the close, the Yen is leading the market as it already turned down before the market allowing time for the divergences to form, then the market moved opposite the Yen again and in to the very weak closing move, the Yen is slightly higher, the DIA slightly lower.

It Gets better...

 Yesterday we didn't see today's loss of significant gains, this is a 5 min chart of the Yen with the 9:30 open in green and the 4 p.m. close in red

Looking at the SPY (green) and Yen (red) for yesterday alone, the Yen falls hard at the open, the market also has HYG supporting it, then HYG gives out as support before 11 a.m. and around noon the Yen's downside mellows out, the market goes sideways with a mellow yen and no HYG support-in fact the opposite may explain why the market is flatter than they Yen's decline, because HYG losing ground is negative for the SPY arbitrage.

Just before 2 p.m. the Yen heads higher, the market heads lower at the exact same time, then the Yen heads sideways in to the close, the market does too, but remember all the ;levers being pulled yesterday?  At 3:47 yesterday I posted, "Desperation" because it looked desperate when you saw how many levers the market was pulling, I assumed to reclaim NDX 3000, all of that lever pulling allowed the market to move a bit higher than the Yen correlation at the time-IT WAS DESPERATION!

Now, here's the Yen after the close, it's now moving up a bit...

And here's ES after the close, it's finally moving down a bit, so although it didn't occur before the close, it is occurring right now!

I have a lot of Yen analysis and correlated asset analysis to do.