Rsync and lsyncd error

Question

I am on Amazon EC2 and trying to sync two directories(/var/www/html) on my instance together with lsyncd but I am receiving this error in the log:

rsync: connection unexpectedly closed (0 bytes received so far) [sender]
rsync error: error in rsync protocol data stream (code 12) at io.c(600) [sender=3.0.6]
Mon Dec  5 05:43:36 2011 Error: Failure on startup of '/var/www/html/'.
Mon Dec  5 05:47:38 2011 Normal: recursive startup rsync: /var/www/html/ -> 10.xxx.xx.xx2:/var/www/html/
Permission denied (publickey).
rsync: connection unexpectedly closed (0 bytes received so far) [sender]
rsync error: error in rsync protocol data stream (code 12) at io.c(600) [sender=3.0.6]
Mon Dec  5 05:47:38 2011 Error: Failure on startup of '/var/www/html/'.

Here is my configuration.

[root@ip-xxx ec2-user]# vi /etc/lsyncd.conf
settings = {
        logfile    = "/tmp/lsyncd.log",
        statusFile = "/tmp/lsyncd.stat",
        statusInterval = 1,
}

sync{
        default.rsync,
        source="/var/www/html",
        target="10.xxx.xx.xx2:/var/www/html/",
        rsyncOps="-avlt",
}

Receiving server:

[root@ip-xxx ec2-user]# vi /etc/rsyncd.conf
[application]
        path = /var/www/html
        hosts allow = 10.xxx.xx.xx1
        log file = /tmp/rsyncd.log
        uid = ec2-user
        gid = ec2-user
        read only = false

What am I doing wrong?