Monday, March 26, 2012

Morning Market Summary and Charts 03/26/12

Do I really need to go any further or mention anything other than Futures, Precious Metals Soar As Bernanke Says More "Accommodative" Policies Needed, Hints At "The New QE" | ZeroHedge CTRL+P is alive and well. This sucks. I hate it. You hate it. It is total BS, but it is what it is. they rule the markets and control every tick and there is nothing that anyone can do about it.

The scenarios we've been discussing are numerous, but they all boil down to one thing, QE. That is all that matters till the debt burden implodes the system. "Recovery" huh? One more round of easing and all will be well is the party line. Well, if the recovery is kicking so much ass then why do we need more stimulus? Now should be the time to be removing cash from the system not upping the dose and turning the flow on the IV to the max.

All it took after the Jackson Hole meeting in 2010 was the promise to ease and the markets delivered back to back record months. So here goes the Bernank with strong hints at further easing as Twist comes to an end. Is the Bernank simply trying to buy some time and hopes that the markets can hold up or advance without the liquidity backstop for a short period? That has been a mistake in the past.

I have been speculating at another large (15 to 20%) correction to make the next round of easing a "must or else" scenario. This has been a theme here at STB for some time. You know the set up by now. Generate fear, get the shorts all piled in, then come in hard supporting the markets, squeeze and lift off (in this case into the election period).

Believe what you want about the "recovery". I was at an event this weekend with a bunch of "smart" business leaders. I hinted or spoke of the doom and gloom to come and the most realistic response I got was, "Gee, I hope not Shanky." 99% thought I was nuts and wanted to hear none of it.

It appears they have lulled the upper middle class (in this case) into believing all is well, move along, nothing to see here. Their portfolios are kicking butt and their businesses (those that still have them) have at least stabilized.  All is rosy in America. Nothing fails in this great nation is the stoic belief. Boy are they gonna get a rude awakening in a year or so.

As for the markets, this is simple, the minis cracked the upper resistance off the 1408 top and the 61% retracement. This is it for the bears if they don't hold here. We are in an EOQ period and back over 1400. 1404 is first resistance, then 1408 top and then back to the purple diagonal near 1415. Support is 1400, 1397, 1393 green diagonal then 1385 and 1382.

Patience, form and follow the Fed, I say it here every day. It looked like we had a great shot at more weakness to come, but they shut the moved down on Thursday and Friday. Here we are with the futures back above 1400 round level resistance again. Let's see if  these lofty levels are greeted any differently this time. I still think we have a major corrective coming.

GL and GB.

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