Leading Indicators Confirming

You know when you hear someone say, "My life s going exactly according to plan"? Yeah, I have no idea what they are talking about or what that feels like either, but as far as the market, Leading Indicators were moving in the right direction, now they are getting in to meaningful areas rather than just moving "in the right direction".

I won't go through all of them, but just the important ones that are moving, you know about the others.

The point of this post is that risk assets are diverging with the SPX, this fits well with the negative divergences and other information and confirmations that we have, it's making our outlook and positioning even higher probabilities and giving us the movement we normally see that makes it a lot easier to say, "This is the spot! Load up the truck!"

 Commodities as a risk asset should follow the SPX (SPX is always in green and is the comparison symbol unless otherwise noted). When risk assets don't move together there's a problem and the move in the market is suspect.

In this case, the EUR/USD is changing and losing the head of steam it had that was supportive of the market, commodities are more closely following that relationship as that is what they are base and priced on.

 Here's the Euro vs the SPX, note the negative divergence in the Euro, which means the SPX/market is moving AGAINST its natural correlation, that happens when there's manipulation and usually in a case like this, they'd be using higher prices to sell in to which is what we have been and still are seeing.

 This is the $USD vs the SPX, at the yellow arrows this is the proper correlation, they trade opposite each other, but look at the last 2 days as both move up together, this is more evidence the SPX and market are moving up totally against their normal legacy arbitrage correlations and more evidence of price manipulation, setting up trend 2 (down), but trend 2 should be much, much bigger so the set up is not a day long as we have seen. I still think when it breaks, it breaks faster than any reversal we have seen since the last flash crash.

 Finally High Yield Corporate Credit is not jst negative and divergent vs the SPX if you look close, now it's showing a clear divergence, remember I said it would start out slow and gain momentum just like the 3C negative divergences last week starting on 1/10? Look at today's trade!

 This is what it looks like with less of my scribbling.

Junk Credit is doing the same.

Things are going according to plan