Risk: S&P 500 Moves Red (First Flag), Russell to Yellow

Familiar patterns, weakness in the real estate sector. Technology breaking lower. BTC and gold moving lower as bond yields hit their highest levels since July.

Dear Fellow Expat:

This is just a quick update from this morning.

At roughly 11:15, an intraday signal turned negative as the S&P 500 ETF (SPY) selling continued to pick up at the 580 level. That’s going to be an important line in the sand as its holding right at its 20-day moving average - but the move on the dollar is signaling something bigger - as it moves to 4.23% on the 10-year. Look for some support at the 20-day level. There’s money leaving…

We’re not focused just on technicals. We’re counting capital leaving the index and not rotating into other sectors. In the last week, 47 S&P 500 STOCKS are down more than 5%. Just 10 are up more than 5%. It’s an 8-1 score on stocks down 10% versus 10% in a week. Doesn’t seem like much… but that’s just the first snow pack. Historically, we look for that momentum to build and numbers to pick up as selling intensifies.

That’s significant money exiting the S&P 500 and not rotating into other places.

We know this because the Russell 2000 has also…