Cobra's Market View

TLT (20yr treasury) showing a solid RSI bearish divergence on the daily chart. short-term positive for equities.

S&P peak to trough is now -19%, which is the average drop for all recessions in the past 100 years. i.e. the market has already priced in a double dip recession.

most recessions have a 40 day duration volatility spike. this means we have choppiness for another 6 weeks.

S&P stock correlations at 84% are near all-time high -- around levels seen during 1987 crash, spring 2009, and summer 2010. All eventually resulted in very strong rallies.

when the vix opens and closes above its BB, is that usually a short term reversal signal?

S&P 14 day RSI - now the most oversold since Summer of 2002.

S&P 500 dividend yield now pays higher than the 10-year US treasury yield. the last time happened was in late 2008/early 2009 -- just before market reversal and bull rally.

S&P RSI just broke below 30 for the first time since March 2009. It has broken that level 6 times since Jan 2007.

After each occurrence, S&P finished up 1 month later - even during 2008.

oex put/call ratio also falling. below 2 once again.