The Dollar or the Banks?

Earlier today I suggested that with little news/macro-econmic data out today, the dollar or EUR/USD trade is likely to influence much of the action.

However, from last week's sector rotation into Financials, which supported the financial heavy S&P-500, was certainly showing signs of distribution as the accumulated shares (for the bounce) are distributed into higher prices. That distribution accelerated today, leaving the XLF which was seeing gains last week of +.83% to + 1.65 (and the week before, one day  gains of +2.5%) finishing the day at 0%, that from an earlier gap higher.

Here's the comparison of the EUR/USD vs S&P and Financials vs S&P

 Above, the SPY is in red, the FXE-Euro is in green. The action in the SPY was similar earlier on in the day, but it diverged badly at the end of the day as financials started falling apart.

Here the SPY is in red and the XLF is in green, again note the FX/Currency market controlled the early session until the XLF went into heavy distribution. Ultimately, the Financials were responsible for today's loss of upside.

The S&P- +.01 %

Dow-30 +.17%

NASDAQ-100 -.35%