A.M. Observations

Lift by the Carry, Dive by the Carry.

As I said yesterday, I'm going with the probabilities and get ready to see some "unusual" things ahead.

Overnight I don't know what the catalyst was and often I think the notion of a catalyst is just a human construct so we can make sense of a seemingly senseless market at times.

Index Futures were lifted by JPY crosses and then they fell by JPY crosses.

 ES in purple vs EUR/JPY, I think it's pretty clear.

 This extreme, fast building leading negative on ES's 5 min chart is a bit odd and ES is moving below the lows for this week thus far.

On the 1 min ES chart an equally, but much less powerful leading positive so I'm guessing "Volatility Ahead".

Even though Gold and Treasuries no longer have the QE correlation, in fact the opposite, whenever a QE event comes up, they react as if they did have a QE correlation, but this morning T's are higher and Gold hit a 10-second circuit breaker when it popped higher $10 in 1 second. The $USDX is acting moderately like QE on like Gold and Treasury Futures, CLEARLY stocks are not.

This is what the correlation should look like, at least for gold.

/YG/gold 5 min futures, remember that buy on Friday, right on time...