Monday, September 13, 2010

Morning Post, SPX, S&P 500, E-mini

Nothing like the certainty that the global economy is crashing, the banks are all really insolvent, the consumer is dead and coming in Monday morning to the futures up 9 (actually 3 off the high) and all because some moron decided to let the banks in Europe lever on up. Wasn't there a lesson to be learned from fractal lending with drastically overvalued assets backing up the capital? This is like a nightmare. Extend and pretend till the next LEH incident. All is well in the land of unicorns and fairy tales. You can not fight the system.

Economic Calendar - No real big days till Thursday. Today you get Timmmaayyy and the Treasury budget at 2. tomorrow morning Retail Sales and Business Inventories.

Cash may want the gap from 16.89 to 21.06. The Island closes at 17.89. The double top is 29.24. 10.10 is the 78% retrace that really should not be violated. If it is and held, then the bears need to rethink what the hell is going on and get on board with Team Manipulation. I personally think this will be a blow off top as we finish the 5th wave of this A leg of the ABC or as we finish 2 of 1 of 3. A pullback to the 92 to 85 range then a pop to possibly as high as 1040 is possible. The 1100 to 97 range is now solid support. There is not data to really spook the market till Thursday (data we can believe in). I think if you want the truth you need to simply look at the Gallup numbers to cut thru the crap the government is spreading. Sadly, reality does not drive the markets. They keep on doing what any good soldier does in a fight for life, they use any means necessary to prolong the battle till reinforcements arrive. In this case, there are no support troops and they are down to their last few bullets.

If the weekly topping process holds I'll be looking to get the SPXA50 above 400 and watch for that final divergence to be set on the $NYMO. A weely green MACD hist bar would be nice as well. As for the daily chart, other than MACD everything is in place where a top can be possible. They are not strong topping signals, but most indicators are beginning to just now enter the overbought arena.

SPX 60m - Not sure if the top line of this wedge holds or not, but the wedge up is what we're looking for. You all know I hate the 60m chart, but in this case it really looks like a blow off top near term to set the C point of the A-E wedge formation. 
Sadly my 30m chart has been rendered useless as price has blown thru TWO nice divergences in this rally. Time to start looking at some longer time frame charts. We have all witnessed what they can do to the markets and suspending them in overboughtland is one of their specialties. I expect a corrective soon and the form of the corrective will tell us if this is some sort of major top or not. We have also seen that when it falls it like to do so quickly. It does not take much to make the southern momo going these days. In the meantime the ramp continues like it or not.

Don't forget Shanky's Dark Side where I call the action real time. More detailed charts and a board with some really smart people. All are welcome. 

If you want to know more about why the markets are up today please see 3 Out Of 3 Analysts Agree: Basel III Will Guarantee Their Bonuses For 9 Years In A Row, As Banks Win Again.