What Is Stock Market Leading Indicator Saying Now?

Worth a read: Baltic Dry Index Continues Leading The Stock Market.

Do check out the chart posted in the posting and the last few passages is worth noting.. esp the comments saying that the markets could be topping.

• ................ In fact, if you compare the S&P 500 index for the past few years with the Baltic Dry Index (BDI), it would seem that shipping rates have lead the equities from 1 to 3 months in both rallies and tops (take a look at the marked points on the chart above).
  
  Of course, the relationship is fuzzy and not a one to one, up and down, direct correlation. But in all its fuzziness, you can still make it out rather clearly. You can even see that about a month before the stock market went into a waterfall decline last year, the BDI broke down below its low and started on its head first dive.
  
  So what is it saying now?
  
  The BDI topped out in early June 2009 at 4291 and has since been in a downtrend. In keeping with the same approximate time lag, we would expect the stock market to top out in late August or early September. Which is right about now. We’ve been underwater since the S&P 500 index hit 1031 on August 27th, 2009. Now, I’m not suggesting that you trade just on this type of thing but it does provide an interesting context. Especially when you consider everything else which is telling longs to be cautious.
  

Technicals On Commodity And Correlations Charts Between Eur/USD vs Oil and Oil vs Baltic Dry Index

Posted on CNBC.com

• The price of a barrel of crude could lose another $20 and the broader commodity market could slump by a third as the recent downtrend is set to intensify, Phil Roberts, technical analyst from Barclays Capital, told CNBC.
  
  The commodity market is still very much pricing in a further slow down and the signs we're seeing at the moment suggest that the process is intensifying rather than diminishing," Roberts said while taking a technical look at the Goldman Sachs Commodities Index.
  
  The GSCI, which tracks a broad basket of commodities including oil, wheat and lean hogs, could lose another 30 percent to 40 percent, according to Roberts.

Check out the source which also includes a video clip: http://www.cnbc.com/id/27235187

And ironically, dearest Kathy has loaded two simple charts indicating the correlation of oil prices and EUR/USD. see: http://www.kathylien.com/site/us-dollar/why-is-the-eurusd-not-rallying

There are two charts to note, the daily chart: http://www.kathylien.com/site/wp-content/uploads/2008/10/eurusdoil101608_daily.jpg and the hourly chart http://www.kathylien.com/site/wp-content/uploads/2008/10/eurusdoil101608.jpg

And lastly, I would also note the correlation chart drawn on the oil and BDI from Kathy also. See posting http://www.kathylien.com/site/us-dollar/chiming-in-on-the-baltic-dry-index for the correlation chart: http://www.kathylien.com/site/wp-content/uploads/2008/10/baltic101608.jpg

The Said Correlation Between USD and Crude Prices

Commented by Kathy Lien, Crude Crushes the Dollar

• The correlation between crude prices and the US Dollar has been greater than 70 percent since the beginning of the year. This correlation is evident in the following chart of oil prices and the USD/EUR. The sharp drop in crude prices single handedly triggered the sharp dollar rally between July and mid August. Now that oil prices are creeping higher once again, it would only make sense to see the US dollar slip as well.