ES / CONTEXT

 CONTEXT was inline with ES early today, as the early afternoon gains were put in, the model started diverging negatively from ES, it's not a horrible divergence, but it is enough for a short or near term pullback.

 Note also ES saw no positive divergence at the lows like other averages today, which is why I believe Schumer's remark to Bernie today was the initial catalyst as the market was reactionary rather than proactive, the only thing I really see that looks proactive appears to be selling in to strength. Es which was in line with 3C for most of the day, is now in a fairly large leading negative divergence .

 Yields are still bothersome as far as the sub-intermediate trend goes, they are one indication that doesn't quite fit the sub-intermediate trend theory, however on a short term basis, the negative divergence in to SPX strength for a pullback is there, just as it was earlier this month.

 Commodities have outperformed for their correlation to the FX market by a wide margin and even outperformed the market several days, it almost seemed as if there was a buy the rumor sell the news event in commodities today with the rumor or at least sentiment being Bernie would leak some sort of easing today as commodities have always been a beneficiary of easing; their late day underperformance relative to the SPX is the first in a while.

Finally High Yield Credit, the playground of the big boys and girls; the credit markets are huge, very few trade credit (I haven't met anyone on the retail side)-this means credit often leads equities. If smart money wanted to express a bullish outlook, they'd use High Yield, if they were looking for a flight to safety, they'd use investment grade. You have to also understand positions in credit markets are large and take time to build and change, they usually don't stop on a dime, that's why this chart of HY credit vs the SPX is interesting, you can see HY being bought in to SPX weakness just before an upside reversal and HY being sold the last few days in to SPX strength, this falls along the lines of the pullback we have recently been talking about. However the longer term position of HY credit still remains supportive enough for us to see that run to the top of the bar flag and possibly the final short squeeze move.