Tuesday, May 11, 2010

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

Gaps, wedges, channels, triangles, who the heck knows right now? Overbought, oversold, strong, weak, this way, that way, bailout or no bailout? $10 billion all the way up to a trillion and now some are saying that will not be enough. It is any wonder to me that the market still exists and simply did not implode in '08 like it should have, but if you start throwing around $26 trillion you can solve a lot of problems.  Well, you think you could solve a lot of problems, but in reality when you take US taxpayer funds and funnel them to the banks, both foreign and domestic, to support their balance sheets and toxic debt you don't solve jack. Thus, we have gotten nowhere in solving any issues. The Keynesian experiment is running out of time and sadly we have put all our chips on the table. Failure is not an option, but it may be the only answer.

Economic Calendar - No market movers today

Pivot Points - Not sure how relevant these will be for a couple of years.

Minis are up 12 at this time.  Daily MACD has a while to go before it crosses. Although the histogram is going up, the signal line will need something more drastic than yesterday to get any positive signs here. That says we should expect more weakness. EUR/USD is oversold as well. It came back to close the gap from Monday's open and is under 27 again. the dollar is getting a little over bought, but that may become the norm.

SPX 30m - This mornings open will generate a sell signal and will most likely cause the 60m to roll over as well. Volume is the big question. If the bears come back, at what level, heavy or light? I'm afraid if it gets to rocking south we could be in for another rocky day. Volume is the key. The bulls could not capitalize on yesterday, so I am declaring them dead. Maybe reality has set in and the truth has shown them the light.

Charting and counting is very difficult at this time. What looks like a 1,2 1,2 move has been completed and maybe the corrective is out of the way? The minis are back into their P2 rising wedge but the SPX is meeting resistance while backtesting the P2 support line. Maybe that was 4 and here comes 5 with possibly 1 of 3 of 5 here at the open. there is no telling what is going to happen once the markets start selling off again. I assure you that the exchanges and PPT are on board to do their best to curb any slide. Sadly my targets range from 41 to 20 at this time with the possibility of lower lows always in the mix. I can't get any more specific at this time. Upside surprise would be just that.

A quick look at what will either be a double top in gold or a breakout move to higher highs. If that is a cup let's see if we can get a handle here. Gold daily getting a little tired, but weekly and monthly look like they have some room to run.

GL today!