I think my initial gut feeling about an initial knee jerk move up and then following the probabilities back down is still a decent possibility, I'm still leaving BIDU calls open, however the longer term Leading Indications are now comfortably in the realm of deep divergence with the market except for a few. While I have expected a quick reversal when it comes, the truth is topping or bottoming is a messy affair, it's rarely a "one day you're up in a trend and the next you're down in a new trend", there's that chop and volatility to keep everyone guessing.
Maybe later I'll post some reasonable examples, for now though the leading indicators which are telling us a lot on their own.
The speed, depth and momentum in the decline of High Yield Corporate Credit which is VERY liquid and therefore a favorite as a risk asset that is used for risk on moves, is stunning , today's move alone has eclipsed the past few days of decline.
Junk Credit has been even worse to the downside, these are the types of strong divergences with the SPX we see at reversals and where we have become pretty aggressive with our shorts and rewarded.
The $AUD
FCT which has worked well...
Commodities are one of the only other than the Euro that are holding on and guess why?
In green you are now looking at commodities vs the Euro.
I'm going to do more research there (EUR/USD), energy would be the natural play on a turn there.
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