Thursday, December 16, 2010

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

The charts look nasty. If the Fed can be distracted by the bond markets and the EU bailouts there are not enough funds to save all. They can't print it fast enough and the Ponzi will finally die. All of this is happening now. I have come to the conclusion that there is a good chance that the top is set. At this time we have to consider the only two scenarios left - top is set or there is one more pop left in their arsenal. Those waiting on a failed treasury auction to mark the top will be to late. That will be the final shot to destroy the Fed and treasury's Ponzi economic system.

Economic Calendar -   Get the CPI report here from ZH. Pretty busy the rest of this week. Please ALWAYS check the calendar. 

POMO Schedule -  We got a new schedule Friday and the biggest surprise was there will be two POMOs on the 22nd totaling a possible $17 billion. Yet another POMO day today. (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 and throw out tons of charts.

Pivot Points -  For what they are worth in this busted market.

The divergences on the daily charts and the position of the weekly charts combined with the overbought conditions and the euphoric bullishness is the perfect storm. The recent earnings misses are a tell I believe. The biggest being the FedEx miss. One has to ask, how did we have a great inventory build and superior internet shopping and FedEx miss? This leaves a massive hole in their economic rebound story that leads me to question the validity of all the BLS data even more than before.

As for counts or position of indexes, they are all over the place. Who is leading? Tough call, but I believe the RUT is possibly as it counts a full 5 ahead of the SPX. Now, ignoring counts (which I strongly encourage - remember I use them, but rely primarily on TA for all calls) they are in a similar position. The financials fell first againfor the third time. how many times can they collapse and recover? This will be the third such instance recently if it recovers. That trend can not continue.

Remember the DRYS trade I gave you two days ago when it was above $6.40. Now trading below $6. the BDI is still falling and DRYS should revert to at least trade near it's index. Keep an eye on that one.[s204970999]&disp=P

SPX 30m This move has been tiny, but it feels massive. I mentioned the 1235 support yesterday and price is stalling there right now. Futures were up till FedEx and are now basically flat. I count a completed 5 off the top and think we should get a corrective of some sort here before further weakness. Right now I am targeting 1220 if not worse. Let's walk this thing down and not get carried away. Remember we have to treat this as the top is possibly in, but are expecting one final leg to the top.The 200ma on this 30m chart is my target (or the 50ma on the 60m). Watch that TRIN here it is getting up where a possible buy signal is coming. That would signal the corrective or the bottom of this move.

CPC chart - All this needs is a divergence at this point and we're suddenly in a Bud Light Schmeplicate "Here we go" moment.  (Of course my fav is the Swear Jar)

GL and happy holidays.