Add this 3M chart of the same AUDJPY-SIMSCI divergence theme. What’s notable is that AUDJPY appears to be stepping down to a lower range where it traded between 2010 – late 2012 while SG30 remains at lofty levels.
Month to date overlay of EUR, GBP, NZD, AUD, CAD, SGD, JPY and CNH showing their relative performance/strength against USD. Three trading themes (performance clusters) to choose from.
Stock indices continue to be bullish. DAX 30 is correcting, Nikkei 225 could be correcting soon. Until 13-week ema is broken, no reason for alarm.
It appears there is a big divergence between the usually highly correlated HSI, SiMSCI and AUDJPY. Who is smarter? The stock market or the forex market?
There is a distinct bearish divergence between XLE (Energy Select Sector SPDR ETF) and WTI. XLE has completely reversed it’s post-Trump election gains and is now in the red.
Gold mining stocks Barrick Gold and Newmont Mining show bearish divergence by not following gold’s recent gains. These stocks were leading indicators of gold price in 2016.
These charts of DXY, EURUSD, AUDJPY, SiMSCI and the IWM, SPY and DJT all say this message to me: that the USD will continue higher and a stock correction is just round the corner.