What can Obama (Bernanke) do to turn this around.....

King Dollar looks strengthening...

 The Miners and Gold look bearish...

 ...and so do stocks.

The search for the magical rabbit has begun.....maybe they find it in Spain or the US or Greece....or not at all...we shall see!

Echo of 2007 ?

We updated our ISE and CBOE option charts and found an interesting constellation consisting of a sequence of 3 Extremes which is fairly rare. The only other time we saw a resembling sequence was around the BIG TOP in 2007. We also find it striking that this pattern can be found in both data series.

This should at least taken as a warning and fits nicely in the picture of all the other Extremes we have highlighted yesterday. 

The current period develops a special signature which seems to evolve into those decade highlights we will remember in the future.

On the shorter term we have to wonder how many retests the bulls can pull of before they either bounce or fail.

Bearish Reversal

The bulls need a quick upside bullish flip to avoid the "Bear land" today.....

King Dollar and the Inflation Trade

The Euro might weaken (and so the risk trade)....

 ...into the next month...

 ...like the Gold Miners...

 ...and Gold...

 ...and the US 20yr Treasury....

Let's see what happens after next week's OPEX... 

Miner's Breadth warms of some immenent Pause in Gold

Mining Stocks send a warning signal that the Gold rally could experience a well deserved (temporary) break.

Breadth and Insider Alert!

Breadth as being a gage for broad market participation (here measured for stocks of our Institutional 'Must Hold' Portfolio has developped a negative Divergence as well.

Neg. Divivergences have a solid track record with a nearly perfect signal ratio since 2009, so we should take this serious and look at the risk trade with caution.

Corporate Insider have already started to take money off the table. We have an Extreme reading & a Divergence which further underscores the cautious message.

The degree of risk seeking has reached a multi-year high, now that the FED has given the green light.

Market is turning binary....

Another look at the same from a different angle offers our Vix True Value Indicator (based on some Vix vs Hist Vola concept).

Here we find another divergence which should serve as a warning that the market will either shoot up or down and that he we should experience bigger moves soon.

Is CRUDE the first to tumble ?

Crude was one of those EXTREMES we alerted you about over the weekend. Will Crude be an isolated event or will the others follow. The Euro is testing the 1.30 as we write this so it seems the train left the station....

Sentiment Alert- Divergence Edition

Market at Extremes not seen in over a year!

The following PICs are from our Call/Put Ratio Series and from our OI (Open Interest Positioning) series. They underline the chracteristics of the unique juncture we are at through the lens of the Option Market (Smart Money).

We also looked at resembling Extremes and the nature of the entailing correction to provide you with a context.

It should also not be surprising that we find these Extremes in the core of the RISK TRADE:
TECH, EURO, BANKS, OIL, MINERS.

Red Alerts all over the place!

The Trend picture at Apple calls for caution....

 The Dollar seems exhausted to the downside.

 Gold in Euros looks prone to flip down.

 Goole feels like Apple.

 The Small caps are the same.

 Silve had a fantastic run, but....

The aggregated Flow-Momentum of the lev. ETFs shows weakness.

 TLT (20 yr TSY) is falling apart.

 Like Silver so is OIL.

We had a fantasctic 'post Olympic rally', which towards the end was driven by Hope and Centralbanks and plenty of Short-Covering.
This has the feel of a major Headfake into the weak season of the year. 

Gold and the Silver could take a break here

The recent Optionflows hint at the risk of a break or pause....

The aggregated Open Interest Position looks the same.

 The TimeCycles confirm the view of a pause.

Sentiment Warning !

Return of King Dollar II

History in the making!Over the last decade we looked for situations where the RSI hit around 80 while the price moved beyond the 3 Stan. Dev. 50d Bollinger Band and we find only 4 occasions (2006,2008,today).
Then we looked at situations where the RSI went from extreme oversold to extreme overbought and found 3 occasions (2003,2008,today).

Bottom line:
The recent move is of a very rare and special nature and the odds favor at least a 50% Retacement (Euro 1.25) if not much more....