SPY / TLT Spread Widens

This is an emerging pattern that bears some scrutiny. 

It would be easy to dismiss the “A” chart divergence as a product of August volatility but it appears there's something more fundamental going on when the rally of the past 3 weeks is doesn't cause the spread to constrict…in fact, it's expanding. 

The dramatic collapse of the equity curve relative to the R Squared line in August ushered in the divergence and one preliminary conclusion is that TLT may be significantly overbought at these levels and or/ SPY is oversold.