Wednesday, November 10, 2010

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

Not sure how long the market can continue to praise -435k job losses as a victory (especially when you know they will be revised). This is the 42nd downward revision in 2010, out of 44. The 99ers are going to be dropping like flies soon and when they hit the streets the brutality of reality will shine, and the raw fact that our government has failed at doing anything to assist anyone other than the banks will be more prevalent than ever.

Economic Calendar -  Really quiet week for data. Thursday is Vetrans Day. Please ALWAYS check the calendar.

Earnings Calendar - Earnings info here at MarketWatch Earnings Summary HERE.

Pivot Points -

POMO Schedule - NO POMO today. The next schedule will be released today at 2:00.

Shanky's Dark Side - Where I call all the intraday action.

Minis reaction to the jobs number was delayed as the initial call was greeted by a pop then drop and about 10m later the PPT came in and ran price thru the 1212 resistance. 1216 is the bigger resistance above now.the dollar fell a bit on the news and is basically in line with the close from yesterday. Will the commodities continue their move south. can we get into some sort of brief profit taking mode. Dollar moving ahead of G20 tomorrow may have been some sort of consolation to get the numbers slightly less skewed before the meetings.

I have been calling for the pop-n-drop and so far so good on that call. Has the drop run it's course is the big question?  I am a big believer in market manipulation and Ben has said he'll do anything to keep the equities markets roaring. Today we get the next POMO schedule. Just how large does the Fed go and when do the POMO's start? That will determine the bears window to continue this fall. I am calling this a 4th wave or a corrective before one last ramp most likely into early February. All bets are off after Xmas. They can not let ANY negative sentiment creep into the markets between now and then.

SPX Daily - My hope is that they allow the markets to fall to the 1175 level. Best case would be a fall to the 1155 level. Those are both a pipe dream of course. What is more likely is that the pattern of ramp and rectangle continues. The move to 1227 appeared to be measured (equal to the width of the last rectangle). So, the top may be in for a little while (depending on the size and strength on the next POMO). At this time anything down is deserved but will be squashed by the fed. The market is their preferred vehicle. It is rigged and you need to play it as such.
USD Monthly - My favorite chart that helped me call the 74 bottom and the 89 top. What the heck does it do here? Could it continue to consolidate or does the descent continue as the triangle breaks down? Applying QEII to the markets one would have to speculate that the inverse relationship the dollar has to the markets is about to be tested if the dollar is to continue to consolidate in the triangle. I speculate the Fed will allow the dollar to rise some as imports for the Xmas season are all in the country now and retail can't be helped anymore. As the sky high commodity prices finally get passed along to the consumer next year retail will get destroyed, so the dollar will have to remain low or even fall more (this is the Fed's oxymoronic conundrum).

Looking for another red day, but not counting my chickens. Let's see the markets reaction to the POMO schedule release. 1212 is apparently a number the minis have been struggling with. 16 is above that. Below there is nothing till 1200. If price can get moving south and can get into that ramp from 10/04 then it should retake that rather quickly. If price can not break down from here, you may want to consider getting long with tight trailing stops. It is all a guessing game on this the possibly last non POMO day till infinity.