Friday, January 7, 2011

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

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Sorry I'm late, I've been waiting on the employment report. Minis spike down from 1272.74 to 1264.50 on the news. Minis stalling at 67.5. That 50% LT channel diagonal has held yet again. Minis have to take out 65 before we can get anywhere meaningful. Now recovered to 71 as I have typed this post.

Economic Calendar -  Please ALWAYS check the calendar.  Today has employment, The Bernank and cons credit at 3.

POMO Schedule - 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 and news posts in the comments.

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

The dollar is up almost $2.50 this week while the SPX is up 17 points over the same period. The EUR/USD has fallen from 1.34 to under 1.30.

The Bernank speaks at 9:30 (or 10 not sure). That could be a market mover.

Geomag storm ongoing.

On the debt ceiling, after listening to the Pauls it sounds like it will be raised. The markets will like that, and I am now considering moving my top time frame from February to this summer. That would make this assumed fall (if it should/could actually fall) only a corrective. The most disturbing thing I got from the Pauls many comments is that they will raise the debt ceiling IF they cut spending. Does that not sound like an acceleration of the wealth transfer? Maybe this is a step in the right direction, but it does not sound that way on the surface to me. I'm still digesting this thought from the shower this morning. Much more on this soon. This will drive everything this year, mainly new domestic austerity programs and further job losses as they continue to steal from us to keep the banks alive.

The POMO/Bear battle is raging. There have been a slew of very quiet downgrades this week. I think earnings season (begins in earnest Monday with AA) will disappoint for the most part for various reasons (except financials of course cause they will use REPO 105 legally or not to get their asset balances right). We all heard the retail numbers yesterday. The markets are showing some extreme divergences on the daily chart. Bullish sentiment is thru the roof. My CPC chart is at extremes. The EU is collapsing.All, not good and should accelerate.

B1Ferris asked last night, "What do you think of the weak performance on a heavy POMO day?". That is a great question. We're nearing the end of the rope, but POMO and manipulation rule. We (broken record) must follow the Fed's lead at least till their game is up. Maybe they let the market breathe here for a bit. They may not have an option if earnings are bad, the dollar continues to advance and the states (almost all facing tremendous budget shortfalls) need additional help sooner than later. I think the answer is that there is tremendous selling pressure, and that Turbo's dire statement yesterday was the tell. Give us the money or we're totally screwed is basically what he said (where have we heard that before?). How could the markets not totally collapse and flash crash on that statement is beyond me (CNBS is all over that one,,,shuh...right). That said, I think POMO may only have limited effect from here as selling pressure should grow. Upside from here should be very limited.

The markets should have put in some sort of near term top or the top (I can't commit to that, but I kind of want to). Other than POMO I see no news events (other than manipulated BLS numbers that even Gallup has issues with) that can help form here. Pressure in the EU is growing, and they are even setting standards for a bank failures at this time. This should be the year it all ends. We'll have to see when things begin to accelerate like they did in '08.

GS has released a 1500 SPX target, so we may want to take note of that number. It may be another long year for the bears. See the wedge below. The last two major tops came after a divergence of the weekly TRIX and it has not even bear crossed yet. When I first put that target box up I got a lot of grief. People thought I was nuts. We're in it now. I don't think I will have to adjust it. I still have my 1283 target and at this time am not considering raising it. Oh, and GS's 1500 target  is wrong unless we get a great a great overthrow. You tell me what is going to cause that as we fall farther and farther into the hell hole of debt?

GL and GB. Have a great weekend.

Gold quickie - It is at support.
This GOLD:USD chart has been spot on for a while. Each red line has given at least a 4 month pullback and a 20% corrective in this space. Not saying it will or wont happen. Given the potential for great fear and further deteriorating economic conditions this time may be different.