This remains the first U.S. stock market correction of 2013 that I haven’t been buying on red. Friday was only the third up day for US equities in the last 12 (when Bernanke wrongly decided to Burn The Buck by not tapering). Today isn't looking much better.
It's simple: Down Dollar + Rates Down = US Stocks Down - that’s precisely what we are seeing again today, and what I told our clients earlier this morning in our Morning Newsletter. From a US growth expectations perspective, that’s not good.
Wall Street was caught off-sides again this morning – too long = wrong. Watch the relationship between US Equity performance and US Equity volatility (VIX) from here. I’m already net short in our RealTimeAlerts signaling product, but I’d get really net short on a VIX breakout over 18.98.