While asset-gatherers, commission-takers, and Fed-tinkerers desperately shrug off the recessionary signal from a collapsing Treasury yield curve, there is another ‘spread’ that is screaming “trouble ahead”.

The last few months have seen Philly Fed New Orders tumbling, but without a concurrent slowdown in Prices Paid.

h/t @LeutholdGroup

The spread between New Orders and Prices is the so-called NOPE Index, and as Leuthold Group notes, a drop below -40 has historically signaled notable trouble ahead for stocks, bonds, and the economy.

h/t @LeutholdGroup

The last time NOPE dropped below -40 was in 2010 as stocks tumbled and The Fed was forced to restart QE (Operation Twist) to save the world. This time we doubt Powell would bow to Trump’s demands for Plunge Protection.

In other words – something big is coming!