Leading Indicators Update

This will be brief. There are a lot of leading indicators that are close to in line, for instance one example would be HYG which is clearly seeing distribution and I doubt it's going to be of much use to the market next week as it was this week (if you saw the last post, then you saw the early warning HYG's 3C charts give).

HYG in blue vs SPX in green. The turn to the downside and red on the day is a good development for the market ending this bounce, but look at the overall price pattern and top area reversal, it just looks to clean to me, too obvious and rather than HYG leading the market to the downside, it's confirming it, and that's not why we call it a Leading Indicator.

My feeling at the moment is that there has been plenty of damage done, enough to take the market lower, but as I was saying yesterday, as I always say at a pivot/reversal point, a head fake move is typically an 80+% probability and this doesn't look like one, it looks too clean.

If I had to guess, I'd say Monday we get the head fake move, HYG leads to the downside as it should and that's where the best entries should be, but I'll be looking at charts and possible trades in to the close and may open some partial positions or full positions depending on the charts. However that nagging feeling has been telling me since yesterday, "Hold on, let this really make itself obvious to you", in which case it wouldn't be very obvious to anyone else who's not running our indicators. This looks too obvious.

That's all subject to change if the charts really move in the 45 minutes.