A.M. Update

After a roundtrip night with the Bank of Japan downgrading the Japanese economic outlook sending USD/JPY higher to $109.45, it round tripped right back down, currently below $109.

Cable did the same on the rumor of the Scottish "No" vote coming out ahead and came back down on the actual news that the 307 year old union would stay intact with 55% voting no and 45% voting yes with 85% turnout.

At this point ES is starting to do the same after having risen overnight from yesterday's 2005 close to $2014.50 and back down to approx. 2010, still stronger on the open as of now with Alibaba's IPO, the most hyped IPO ever kicking in around 11 a.m. and don't forget its quad-witching today.

As promised last night, a look at breadth indicators with some now and then....

 "Percentage of All NYSE Stocks Trading Above Their 40-Day Moving Average" (green) vs. the SPX red....

Not only is there a massive dislocation between breadth and the SPX, something that has been deteriorating all year, but really took a dive July 1st, the percent of stocks is at 42%, less than half the market as the SPX makes a new high. Compared to the absolute 2007 top which also saw the SPX make an all time new high, this 42% looks even worse...

  From the absolute top of the 2007 market with the SPX also making an all time new high, the"Percentage of All NYSE Stocks Trading Above Their 40-Day Moving Average".

Here the percentage of stocks is nearly double what it is today and this was the very top of the market in 2007 before the bear market rolled in, we're in a lot worse shape now with half the stocks above the 40-day vs 2007 and less than half on the whole.
 
 The  "Percentage of All NYSE Stocks Trading One Standard Deviation Above Their 40-Day Moving Average" which recently bottomed on a decline of about -* on the Russell, just under 10% before rallying back to nearly 40% repairing a lot of breadth damage, but before price even moved down significantly (although there was the lower highs/lows downtrend starting), we are bow back to a paltry near 24%, The rising trend with price started to give out earlier in the year, but again, everything changed at the start of Q3 on July 1st.

 Compared to 2007, the same indicator, "Percentage of All NYSE Stocks Trading One Standard Deviation Above Their 40-Day Moving Average" at the top of the SPX's new all time high and ultimate top was nearly 2.5X higher at 63.5% vs the current 23.91%.

The big difference being today's market can't hold breadth on a move up or a new high, stocks slip back below their moving averages as they decline further, even at new highs; an indication of just how bad a shape this market is in.

The "Percentage of All NYSE Stocks Trading TWO Standard Deviations Above Their 40-Day Moving Average" now at a mere 8.32% and back near lows for the year while the SPX is at all time new highs. These are the momentum stocks. Compared to the top at 2007, the 8.32% now doesn't fare well ...

As the same "Percentage of All NYSE Stocks Trading One Standard Deviation Above Their 40-Day Moving Average" at the 2007 top was moving up to a higher high with the SPX and nearly 4x as many stocks just shy on 30%, compared to the current 8%.

 The "Percentage of All NYSE Stocks Trading One Standard Deviation Above Their 200-Day Moving Average" currently is hovering near the August lows, just under 30%.

The 2007 top's  The "Percentage of All NYSE Stocks Trading One Standard Deviation Above Their 200-Day Moving Average" was similar, but at 37% was moving up WITH the SPX as it hit new highs, the current market already round-tripped back down as price stayed elevated making it a weaker market.

 The "Percentage of All NYSE Stocks Trading Two Standard Deviation2 Above Their 200-Day Moving Average" is currently at 9.72% of stocks. Again...

At the 2007 top and SPX new high, it was double that, yet still had a similar decline in breadth just before the top.