Leading Indicators

I have a lot of homework to do this weekend, but it would seem form just the initial browsing around that there are those that feel the same way I do, that risk on is not a risk worth taking here.

As a result, it would seem the only way to push the market would be through gimmicks like the SPY Arbitrage and currencies, although they are going to be very difficult as the carry trade is being unwound, you have on one hand a need to push the market via currencies and on the other an authentic move out of the carry that prevents that as they are opposing ideas. Treasuries are the same, the last week or so I've been talking about bonds being bid not just in the US, but of all places, the PIIGS of Europe that weren't even suppose to be able to go to market for another 4+ years in many cases, yet they are holding or have held successful placements the entire week, even portugal, that's a flight to safety move.

The homework is weighing the risks here, I'm not joking when I say divergences get run over in a panic and the trade this week as strange as it has been fits with panic, the herd of fund managers has taken an every man for himself approach, the last time I clearly remember that happening, this is what the result was.

 AAPL's trends from a healthy (green) trend to the increased ROC in price (yellow) that serves as a warning, "The trend is coming to an end", by this time we were warning there's something big going on in AAPL, then the top (Orange) which also happened to be the area in which people were most bullish and "AAPL $1000" was a regular mantra of the longs and virtually overnight (considering the scale) a "V" reversal and a $390 point loss or -45% in 8 months, what took 3 and a half years saw nearly half undone in 8 months.

 I applied a Rate of Change Indicator to AAPL's price so you can see how quickly things change.

This was the divergence I was warning about as AAPL was making new highs.

I can spend the weekend showing you charts of markets and how fear is much stronger than green meaning bear markets fall much faster and harder than bull markets rise, or you can take a look for yourself, you know the 4 stages, just compare stage 2 and 4.

However, imagine what the SPX might look like considering it was lifted on F_E_D liquidity alone, not fundamentals or real growth or economic prospects and then take that crutch away as we are seeing now (interesting that the market started to clear up after today's NFP and almost a half a percent drop in the unemployment rate, just 1/10th of a percent above the area they originally said was the target to remove accommodation (6.5%).

Then apply the principle of Fear is stronger than greed and a few other broken market principles such as the exchanges literally breaking every month and HFT's and then add the Global economy and how it's never been so intertwined.

What might that look like? As I have said for a long time, it might look like, "The opportunity of a lifetime"

SPX?

I'll get to leading indicators in a bit, I need to check the close, but note HYG and VXX, you can see what's going on easily.