Retail Sentiment Update

"Everyone bullish now"

"My stream is now littered with bulls, time to pull the rug."

This would seem to make sense according to the charts of late Friday afternoon, the mushiness of many charts this morning except a few key ones like VIX futures and among our own Leading Indicators, here's what sentiment looks like on the other side of retail.

*For all intents and purposes, a early week pullback doesn't make that much difference as most of any short term positions that are set up are hitch-kickers to the upside where they'll likely (almost 100%) to short sale plays in larger positions.

This move (early weakness this week) was described as "noise" and I doubt it represents anything more than that, just noise in a trend. However, here's what we have right now.

 FCT sentiment is negative on the SPX's move this morning and early afternoon.

HIO has been a bit more positive, but still not making a higher high as it should here.

 Short term Yields have dropped, they typically act as a magnet for equity prices so under the normal correlation we'd expect a short term drop in the SPX until they revert to some near term mean.

 This is really a lager view of the expected bounce using commodities as a leading indicator vs the SPX, commods led the downside move and appear to be leading an upside bounce, this has nothing to do with intraday movement, just expectations for a bounce higher.

 HYG (HY Credit ) is in line intraday.

Again, Looking at the longer term picture of the Market Bounce that we were looking for and had started last week, HYG (HY Credit) on a 15 min chart leads the SPX telling us we are on the right track as far as that bounce goes which we first started identifying 8/16.

 HYG's 30 min 3C chart is also showing a positive divergence that should be plenty to support it's leading divergence over the SPX, still this is longer term bounce action and not short term early week "weakness".

 As for intraday or early week weakness, HYG's 3 min chart is losing steam with this leading negative divergence and looks to want to move toward a consolidation or pullback which should have en effect on the market as well.

 HY credit is the first to panic because of its low liquidity, it has not panicked and sold off, but it also seems to be expecting a near term (early week ) pullback in the SPX.

 DIA 5 min with the weakness apparent Friday showing us the probabilities of early weakness this week and it has continued today.

The IWM actually looks to be one of the stronger in underlying trade, the 1 min above is about as bad as it gets, but remember how dispersed the averages were in % gains Friday.

 QQQ 2 min is finally moving away from "Mush" and giving a clearer signal, we will see if it builds on this.

The same can be said of SPY 2 min as earlier we had nothing but mush, now we are seeing some clearer trends.