Remember were looking at the first half of the chart until the Sept. QE announcement.
In that time bond yields are falling while AGNC is rising proportionately to the inverse bond yields (even percentage-wise), while the S&P is correlated to neither really except at times declines in tandem with yields (as one would expect in a bear market).
I cant imagine why my pointing out that AGNC had a strong inverse correlation to bonds is so hard to accept for you, even in principle. After all, it is a bond fund. Sure a more logical correlation might be the 2/10 spread but the idea that AGNC can in principle inversely track bond yields doesnt ound that far fetched. AGNC should not have any meaningful S&P correlation in the first placr.
As to the market running on perception- dismiss my AGNC/bond correlation perception all you want, and whatever little this is worth on the internet: but the breakdown of this correlation between Inverse bond yields and AGNC was a very clear and useful sell signal to me. Just like the recent breakdown of the APPL decline correlation (not at all remarkable to you, eh?) with AGNC was a buy signal for me.
I have to say it explains a lot when you see that there are people out there who have no idea how algos are really programmed to work. I can already tell by the way you said AGNC only acted robotic a few times last year, indicating you thought those particular flash crash days were the ONLY days robots mess around with this stock. What you dont seem to get is that those are only the days they go haywire, the rest of the days they are executing their algo strategies according to plan (which is why we always close so near to VWAP, which we missed by a hair today). They are ALWAYS there making the vast majority of quotes and stuffing them in whenever they want to change price quickly.
Anyway, thanks for your comments and I guess well have to agree to disagree on this one, you seem to think Im imagining things and it seems to me you're blind to whats right in front of you.