Monday, November 15, 2010

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

Big POMO and pre-holiday week week. You have to ask where the euphoria that lifted the markets off 1040 to the heights today over how wonderful QEII is going to be went away. Of course incidents like David Tepper Dumps 20% Of Financial Holdings During Quarter Of Infamous CNBC Speech really shines the light on the type of scum bags out there that are taking advantage of the situation given to all at the expense of you and me without any oversight from the SEC. It appears that the EU foster children will be bailed out again (again, again), so things calm down on that front a bit. Just keep an eye on bond spreads this time to see if there is any relief. Something tells me that for the third or fourth time we just wasted even more good taxpayer dollars trying to bail out the PIIGS from a ship that is destined to sink.

Economic Calendar -  Mixed news this morning and Business Inventories at 10:00. Housing numbers this week. Please ALWAYS check the calendar.

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

Pivot Points -

POMO Schedule - The 8 days are POMO days. (really we'll most likely have POMO from now to infinity or till the systemic failure that is destined to come.) 

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

Monis channeling down while breaking the major wedge diagonal support.The two green diagonals are the remnants of the rising wedge that has dominated price action since the 1040 lows. Price busted the lower diagonal and is now backtesting it as resistance. This diagonal was lowered twice to find it's final resting place and I am not positive if it will not need to be lowered a third time or not. Price is also battling with busted 1200 support. That is a double whammy for Team POMO to have to fight back thru. While this fall/retracement has been larger than any on this run, it is still not all that impressive managing only 33 points (4 points larger than the previous largest fall).

SPX Daily - 20dma has price here. this is a logical first stopping point. Wedge is busted (again). Green arrows are all support points. Indicators look sick as all the red circles indicate. We need to be watching RSI14 at that 50 line if it should approach it. The lower BB and 50dma are below what I am targeting for this fall. Barring some massive break south that should be the max for this fall. Apparently the A-E rising wedge is completed.
Form of the fall and the effects of POMO are what we have to look for. Will the stress on the markets finally do them justice? Will POMO and the Fed's destructive policies to serve the major financial institutions and destroy the middle class prevail? The shell game continues as the rich keep getting richer and the poor keep getting wiped out. We all know that this charade will come to an end sooner than later and when it does the collapse will be of epic proportions.

Form, I keep hyping on it. P3 or "the crash" will be absolutely head-spinning action. We have not seen that yet. I think this is the last corrective before the final push to the last top we'll see for several years. POMO is the 800 pound gorilla in the room. Can they continue to lift the markets, will they just be able to maintain these levels or will they simply be managing the collapse? I obviously think they have one more push in their back pocket..

I have several counts that can be seen on my 1m SPX chart in my chartbook. This is either a 4 of a 3, a 4 or it was an ABC and we're about to go back up again. Last week I gave my first target as 93 and SPX stopped at 94, so we're at a point I believe we can turn. My lowest target is 77.5 at this point with the lower BB and 50dma's near 62 as possibilities. Let's see if price can make it to the upper channel diagonal. How price and the indicators are acting at that point will tell us a lot. Right now the 30 and 60m indicators are oversold and possibly ready to turn.

GL and have a great week.