BarroMetrics Views: A Shift in Sentiment?
In my newsletter this morning, I indicated that the S&P had set up for a high; all we needed was a trigger to confirm a correction. We may be seeing that as I write: to confirm the move, we need to see a bearish-conviction close below 1283 (basis March). Given the day’s price structure any close today below 1283 will qualify as a ‘bearish-conviction close’.
Today’s move provides another opportunity to notice that just may be, the previous intermarket relationships are breaking down. Figure 1 is a snapshot of the my E-signal quote page. Notice that the ESH1 (e-mini S&P March futures) is showing -12.75 and the DX H1 (US$Index, March contract) is down -.455. And, we can’t ascribe the difference to the lack of liquidity in the DX because the FX crosses are showing similar gains against the US; e.g. the EURUSD is up .0101
It’s still early days yet; over the next few months, I’ll be watching the FRED graph to see if we see any significant diminution dollar deposits held by the St Louis Fed Reserve.
FIGURE 1 E-Signal Quote Page