Is this my error ... he thinks he's doing the right thing from my body ques) or is this his way of telling me he doesn't want me near his hiney?
Yes, I reckon
Either or. I reckon he either thinks that any touch on his flank/hips means move away, or he just doesn't like what you're doing, so is trying to escape it.
I'd desensitise him(or re-desensitise) to your touching there. I'd just keep it up, following him as he moves(moving away doesn't work for him), until he stops - be it because the rope stopped him, be it a momentary hesitation, whatever it is, stop touching him immediately & move away. This will show him that what works is to 'ignore it & it'll go away'. Once you've established the basics, then you can gradually build the length of time & different things you ask him to accept, with the same tactics. That is, negatively reinforcing his behaviour. The addition of some positive reinforcement(rewards) for 'right' behaviour is also very helpful!
Try to ensure that when you actually want him to yield, you have a different look about you, so he can learn to differentiate. Eg. When I'm just being with my horses, or grooming, touching, whatever, I remain 'soft' & relaxed looking - sort of a little bit slumped, for want of better description - and when I'm asking them for something, I sort of raise myself up, put energy in my body & movement & focus strongly.