Risk Asset Layout Update

There are some interesting shorter term signals here too in the leading risk asset indicators, although with the Bond market closed for Columbus Day today, we can't see all of the indicators, but there are several that look like I would expect or better.

 AAPL consolidating today, reversals are rarely an immediate event, even smaller ones, these consolidation zones allow positions to be put together, like we might trade AAPL for an upside bounce, so will larger institutions, they just aren't filling odd lot or 100 lot orders.

HYG-High Yield Corp Credit was showing very early relative weakness vs the SPX Friday and today it's pretty much in line, it's rather amazing how credit leads stocks both longer term at major reversals and even intraday or day to day.

A bit longer term for perspective and you can see HYG High Yield Corp. Credit isn't performing well, it's not making higher highs, it's not keeping up with the SPX, this is in keeping with the expectations for this week laid out last night. On an even longer time frame, HYG looks even worse relative to the SPX. Junk Credit looks nearly the same as HYG.

  The $AUD is a great leading currency, you can see the relative weakness in it Friday vs the SPX, today it's showing some relative strength, in part I think due to some decent data out of China, not great, but decent.

 The Euro's weakness today has really put a cog in the European markets, but although it looks to be in line and consolidating in the US session, there are some short term underlying bullish signals.

 Euro 2 min leading positive divergence today, the Euro has a tight correlation with the market, so this is good for the market short term as well.

Here's the 5 min Euro leading positive divergence, after 5 mins there isn't much so it is keeping with the short term strength in price building in to a larger negative price environment.