Although the technical conditions for the previous post still remain. (I will post updated charts after the close.) What looks to be happening right now, considering the mornings chatter, is that the market is pricing in a ratings down grade of the core EU countries.
There was also a mention about china not cutting into this morning. But judging by the strength of the dollar and weakness of the Euro, the decline looks like an EU issue.
Many of the US Money Market funds have already been front-running this, reducing exposure by 68%. Probably the reason we saw French and German yield up over the past two weeks. If the US funds are doing this, I would not be surprised if the EU funds were doing the same.
The market looks to be selling the rumor. We saw this with the US banks. Once the actual downgrades came, the banks rallied.