I hate to say it but.... they told us.

We have been talking about AUDJPY and EURJPY quite frequently since they were enlightening some worrying shades in this crazy-bull rally. It seems that on friday close they were already confirming moves. See these charts of them separated to see each performance and tell me if you can see what I was seeing: such a strong JPY (risk aversion currency) can't be foretelling much more upside in stocks.


See the picture EURJPY was showing on Friday (which is confirmed so far be Monday gap down). These signsamong others were negating the posibilities of ES surpassing 1043 on Friday, that is why we shorted that level.





JPY weekly view:


JPY daily view:




Same message coming from a weak AUD.



But there was more on friday. Remeber out junction point? There were two apparently decoupling (commodities and stock indices) instruments. My guess is that there is no sucha a decoupling but a leading move at commodities that may be signaling the way down for the rest of the market. Despite the huge rally last week these indices couldn't close above resistance and gap...


Commodities ETF, inflation corrected


One thing that does not match with these bearish ST scenario is credit markets still showing appetite for H yields. So keep an eye on it.