Leading Indicators

Pretty much as expected, the divergence between commodities and the SPX now is huge.

 Commodities vs the SPX

 The $AUD is taking a more serious turn for the worse, remember early this morning I said some of the carry trade pairs look like they are being shut down? Well the $AUD is a key carry trade currency.

 High Yield Corp. Credit has nearly flip-flopped from supportive to lagging and in a negative divergence vs the SPY, risk assets are seeing a flow of money out it appears, this just got started yesterday recall.

 The Euro vs the SPX, this is going to be a significant problem for the market, the arbitrage players are going to tear this apart and it won't end until the SPX and Euro are back at their normal correlation, but first we'll likely see a downside overreaction before the correlation is hit.

 Volatility is seeing positive divergences in to lower prices to add to the ones already in place, this is what I want to see, on the other side of the coin, I want to see the opposite asset, the SPY seeing a negative divergence in to higher prices, that give us confirmation.

 VXX also leading positive in to lower prices and it even looks like an intraday move to the upside is coming in VXX/UVXY, I'd like to see the SPY cross resistance first though.

And the SPY doing what I expected to see it do, go negative in to higher prices. Yesterday's late day divergence suggested early strength in the market, now we are seeing negative divergences in to that strength so everything is going as expected so far.