Thursday, September 30, 2010

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

Shit or get. That's about all you can say about today. EU falling apart is a fantastic reason to come off the sidelines and pile into the equity markets. Hell, the minis fell to 1134 last night. What a great opportunity. Jobs are just fine as we still ONLY lose just shy of a HALF A MILLION a week and GDP under 2 should be praised. 21st Sequential Weekly Outflow Confirms Investors Refuse To Be Suckered Into Stock Market means all is well in the land of rainbows and unicorns.

Economic Calendar - GDP and Jobs better than expected! To bad the dollar is in the shitter. Initial Claims Come at 453K, While Prior Print Is Revised Higher, As 300K Claimants Fall Of Benefits

Earnings Schedule - Next week it gets cranked up. Repo 105 anyone?

POMO Schedule - Today!

Shanky's Dark Side - Where I call all the intraday action and provide even more charting.

SPX 60m - It is just way too obvious for them to let it fall.
SPX - Dollar comparison. Wagging the tail. With the dollar headed where it is headed and gold going where it is going all you can do is shake your heads at the POMO supported EQ markets.

Got this in an email this morning - Your fearless leader(s?). I'm not sure if she would melt or not, but I'm positive Pelosi would.
Three options - 1) I'm still leaning to a zig-zag to the mid 70's after a slight corrective. 2) If not it may pop to the 58 to 64 range and then just collapse. 3) Puke up a lung here. EU falling apart but the dollar is weaker than the EUR. That makes a lot of sense doesn't it? Something smells fishy here. Bottom line is that says the whole world has no faith in the US or Ben has pushed the dollar deflation button and can't make it stop. Gold has hit my 1310 target. Financials are not participating in the rally. Quarter ends today. POMO today and only two left on the schedule next week on the 5th and 6th.

Form of the fall will be everything. What price does at the 200dma at 1117 and the 38 to 50% retracement area between 08 and 97 will be the key (if they let it get there). POMO runs next week and then they have none scheduled. They turn it over to earnings where I'm sure REPO 105 is in play for all the banks now, FASB rules have been trashed and the SEC will be doing whatever it is they do these days. When the top is in we will all know because there will be some serious impulse selling with everyone headed for the gates at once.

I'm still looking for my catalyst. Will the GMAC/JPM foreclosure issue lead to it? Ireland is crumbling (with the rest of the PIIGS soon to follow). They have been warning of immanent terrorist attacks ( flag event?). Something is going to hit that will cause them to lose control. What if it has hit? What if this devaluing of the dollar is telling the story? What if the world sees things just a clearly as we do here at Shanky's  Blog where we all know we're headed to hell in a hand basket and will be living in a socialist state in a short while? Either way, the writing is on the wall and it is only a matter of time before the USA has it's national day of austerity strikes like they had in the EU yesterday.

Market is to uncertain to make any calls today especially with Shalom speaking at 10:30. I'm assuming that since the GDP and jobs surprises did their jobs (with POMO in the wings) and he can now switch to speech B where all is well pump can further inflate the SPX/TNX ratio. We have the elections coming and they can't have any disruptions this month. the promise of QEII and NOW possibly TARP II. Bears, hang in there. the hangover form this levitation act is gonna be pure hell for the bulls.


Wednesday, September 29, 2010

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

Not much to say today other than no POMO (that is not saying the PPT does not have some pare change lying around). Three regional Fed presidents speak today which could make things interesting. EOQ, POMO, elections, earnings season and a myriad of other malevolent manipulative tricks all are threats to the bears and the future of our country. Gold has hit my target of 1310 (pullback then buy all you can then sell it while you still can). Everyone is striking against austerity measures across Europe today which could be interesting.

Economic Calendar - Petrol at 10:30 and then 3 Fed Presidents speak today and all can move the markets. tomorrow is the biggie with GDP and Jobs plu other (and POMO of course)

Earnings Calendar - Time to start looking here again.

POMO Dates - POMO tomorrow.

Shanky's Dark Side - Don't forget my blog where I call the intraday action and provide more charts. 

SPX Daily - Resistance at 1150. Upper bear market resistance line (red) at 1164. Oct'09 Diagonal (blue) resistance. C=A (yellow fib) at 1162. Completed 61% retracement of the fall from the high in April. Wedge ending overbought daily conditions. TNX (pink) is where? VIX (green) is diverging to SPX price (this has not been good in the past). Black diagonals are the second option. Worst case for bears is this becomes a zig-zag or we're not in P3. If we're not in P3 this things ramps to a point where when it falls it simply disintegrates to dust. 

Finaincials comparison - Where is the index compared to the TBTF's? Ireland and other fears from the EU are weighing on the financials and without their leadership the markets should struggle. Well, you would think they would. Of course they are all busy doing that Repo 105 thingy to get their books in order for earnings season (legally or not, but that does not matter anymore).

Nasdaq comparison - AAPL weekly 200ma at 158. Diverging weekly indicators are not good.

Today will be interesting as what the Fed presidents have to say should get some sort of reaction from the markets. Fed presidents tend to speak more truth than their leaders. With GDP and Jobs tomorrow the close may get interesting. Bears have it in them and have been trying hard to pull it back. POMO is proving to be the helium that levitates everything. I am voting for a pullback soon as this wedge ends (which could be any time now). From there I can't go out on a limb simply because of POMO, the promise of QE II and the fact they can't let the markets go before the elections. So maybe this thing pulls back and then puts in the zig-zag to the end of November. At this time I am voting that the April high is safe. I still contend that swinging anything is a fools game and the only reliable time frames are the 5 and 1m charts.

Still looking for my catalyst - 'Credible But Not Specific' Threat of New Terrorist Attack

GL out there. It is a tough game.

Tuesday, September 28, 2010

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

Another POMO day. (POMO Schedule here) The promise of QE II, the FOMC on November 03, QE prints, elections and market manipulation continue to make the market untradeable. If you did not know about the latest flash crash in PGN see it here. They have fixed nothing and when it finally goes this time look out.

Financials are finally beginning to crumble again.Without their leadership the rally should be losing it's legs.

Economic Calendar - Consumer Confidence at 10:00. Looking for 52 with a range of 51 to 54.

Earnings Calendar - Time to start posting this link again.  YUM, PEP and AA next week.

Daily SPX - Three wedge options in an overbought market. Green arrows are support. Mainly looking at the 200dma. Get below that and all bets are off.
When indexes all come together like this it is A) not normal and B) usually not good.
Index comparison weekly - I hope we don't have to wait for these to converge. I do not think so as I believe the major top has been set. NAS is a bit out of hand and this comparison shows that it is the most skewed of all the indexes.Where were the indexes the last time USB was this high?
My favorite chart that clearly shows the SPX relationship to TNX, USB and the VIX. This is a recipe for disaster and confirms manipulation and how intervention is literally levitating the market. TNX/SPX equilibrium is now sub 800 SPX. The divergence of the VIX to SPX is painfully obvious and why I think the VIX has been manipulated to a worthless state. 

POMO day, EOQ, Fed on 11/03 and no data tomorrow may help the bulls cause. GDP, Jobs and POMO on Thursday. The bears have been gaining ground at the two sides struggle for control of the markets. 1150 to 1130 range now. I'm still looking for a pullback to the 200dma near 1117. If that cracks all bets are off. Earnings season is just around the corner as well. I still contend they will do whatever it takes to keep the markets afloat thru the elections. The price action has been more bearish than bullish the past week. the bears are trying to sell it, but invisible forces are not letting it fall. When it goes this time it will not be pretty. Till then we have to remain in a wait and see mode as I believe we remain range bound to light pullback going into the FOMC announcement on the third.

GL and thanks for the support and views.

Monday, September 27, 2010

I Know, It Does Not Make Any Sense

What does or could make sense in this wacky world we call finance where the most common theme is to blow harder on the bubble when it is bursting in your face? That is sooooo 1930's dude. The last ditch efforts and corrupt ways are becoming more obvious every day and apparently they no longer are even trying to hide their actions. The complete lack of regulation is astounding, but when your the home team, you own the refs and are losing horribly in the 4th quarter the rules go the way of ethics, out the window.

The blatant rules breaking example today comes from our now weekly occurring HTF implosion of (pick your stock here ______) PGN. Covered by Zero Hedge in From $44 To $4 In Less A Second: Today's Flash Crash Brought To You Courtesy Of The Nasdaq And A Clueless And Corrupt SEC and by Denninger in Just Steal In The Open. As TD puts it, "And where the hell was the circuit breaker on this one? The market is and continues to be a miserable joke, especially courtesy of Nasdaq and the 160 trades in PGN that occurred at ridiculous, HFT-exaggerated prices." Denninger chimes in with, "There is no longer a fair and open market in which you can trade.  There is now a market full of pick-pockets who roam the exchanges with impunity and in fact legal sanction and permission from the exchanges and regulators, stealing as much money as they can, targeting random stocks on any given day."

For Some Additional Observations On HFT Stock Manipulation I suggest you read this as well from ZH. "Reuters ran an article "Traders Manipulating Cheap Stocks" in which it cites Jamil Nazarali, Knight's global head of electronic trading, who basically confirms what we have been saying for as long as we can remember, namely that: "Some traders are manipulating U.S. stocks that are worth less than $1 by taking both sides of trades in order to earn big rebates. It happens for hundreds of millions of shares per day." In other words, HFT algos that do nothing but churn and collect "maker-taker" liquidity rebates, are forcing fake prices in, yes, thousands of names."

Since Insider Selling To Buying Surpasses 1,400-1 you would think things really suck, but the markets continue to rally to the disbelief of many. Well you can thank the Fed and POMO for the levitation trick.Mutual Fund Monday Streak Broken By Absence Of POMO, As SPY Volume Plunges Below Abysmal 

Since the DB buyback announcement we've all known that things across the pond are not near as rosy as our MSM would lead you to believe. We all know that Greece is in deep and the rest of the PIIGS are on life support that no one can continue to afford (you know what they need are some of those new death czars that come with the Obama HC paln - yeah , let's apply that to the global financial system and see how many of them even make it to life support). Eurozone Recovery Slows; Contraction Evident Except Germany, France from Mish paints a nice picture of the rollover to imminent double dip. "How long Germany and France can keep Europe from slipping back into recession remains to be seen, but if contraction of economic activity in the rest of Europe continues, I would suggest another quarter or two at most."

Did someone mention big trouble with big china? Prepare for Currency/Trade Wars; How Might China Respond to US Tariffs?  "With US and China openly bickering, and with the US House of Representatives prepared to act, risk of a global trade war is increasing by the day. I do not think China's chicken move will help any. Every country wants its currency to weaken to stimulate exports. However, that's mathematically impossible except against gold, and rising gold prices will not do exporters any good." Denninger chimes in on China today with Watch The Birdie (Is That PANIC I Hear In China?)  Bottom line is tensions are growing and no one appears to want to come to the table with anything productive as each government tries to save face with it's populace continuing the strings of lies and misrepresentation that led to this mess in the first place.

Since we're discussing China and global financial warfare, let's look into this report form The Economic Collapse, please read 19 Facts About The Deindustrialization Of America That Will Blow Your Mind. This one will blow your mind. Some of my favorites:

#2 Dell Inc., one of America’s largest manufacturers of computers, has announced plans to dramatically expand its operations in China with an investment of over $100 billion over the next decade.

#8 According to Tax Notes, between 1999 and 2008 employment at the foreign affiliates of U.S. parent companies increased an astounding 30 percent to 10.1 million. During that exact same time period, U.S. employment at American multinational corporations declined 8 percent to 21.1 million.

#11 As of the end of 2009, less than 12 million Americans worked in manufacturing.  The last time less than 12 million Americans were employed in manufacturing was in 1941.

Massive deflation folks. It is coming. We have to be able to afford to manufacture again and until we lower wages to a point we can this jobless recovery will remain just that.

GL out there and thanks for the views and support.

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

Will we get another ramp job Monday? With QE II hanging in the wind until after the next Fed meeting on 11/03 and EOQ prints I'd be surprised if the bears can pull it down much this week. May be we just churn as the bulls should have a tough case as well (esp after that ramp Friday). Some data tomorrow and then a big day Thursday with GDP and jobs may have trading subdued as well till those numbers come out. Two POMO days this week.

Economic Calendar - Nithing today but Case-Shiller and Consumer Confidence tomorrow.

POMO Schedule - 28 and 30th this week. Must read - POMO And Market Intervention: A Primer

Global tensions are ramping again. The mid and far east seem to be the hotbeds now. While the reasons differ the one constant is that we're always in the middle. As we have been discussing sine the DB announcement to raise more capital, the EU banks are sliding down hill and out banking sector performance is reflecting that. The NAS dos not seem to care, but all indexes will note the underperformance of the financial sector. The hope of QE II, POMO, EOQ, market manipulation (throw in another short squeeze or three) and the elevation of price into the election season are the lifeblood of the indexes now. All that comes to an end sooner than later and then the great fall will begin. Bankrupt nations that steal from their middle class to support a bankrupt and corrupt financial system and continue to grow and fund a seemingly endless welfare state are destined to fail.

Price on SPX is now running into the January highs, that 1150 resistance is the next hurdle. The weekly upper BB is at that level and the daily indicators are continuing to churn into the overbought arena. AUD/JPY is in a big :T wedge that has price consolidating in a narrowing range now. Gold is nearing my 1310 target ending a massive wedge formation. TNX is getting punished. the VIX has a nice divergence to the SPX that usually signals some sort of notable top. All of that means nothing in the face of all the BS stimulus mentioned above.

Blogger is not letting me upload charts now. If you would like to see the charts that accompany Gold, AUD/JPY and the minis please go to my intraday blog Shanky's Dark Side where I posted a few last night.

SPX 60m (now that blogger is cooperating) - the wedge is real. It should lead to some sort of a top. I still can't buy this being "the" top just yet, but you can not rule that out. Form of the fall will define it and tell us what is going on.

As for today's action, I expect a lot of nothing unless we get some news driven event. The bears may have the upper hand only because of the ramp Friday, generally overbought conditions and resistance as the markets wait on the big news Thursday with GDP and Jobs.As mentioned EOQ and the 11/03 FOMC announcement will keep us in limbo as well. Things in the EU and increasing global tensions will assist in keeping a lid on the markets. Right now I think we stay in a range of 1150 to 1130. Any upside surprise here would be just that and although I am not ruling that out in a POMO/rumor driven market is would be a surprise. I think we're in a basic wait and see mode now.

GL and have a great week.

Friday, September 24, 2010

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

Not much to harp on this morning. Let's go for a good karma day so we can carry the positive vibes thru the weekend. We're running out of time to be able to do that, so let's take advantage of it shall we. 

Economic Calendar - New homes at 10:00. Durable Goods was basically OK.Remember we're comping bad numbers, revisions are the norm and I personally don't think you can trust anything the government tells us at this point. 

Minis are cracking the upper resistance diagonal. Big 60m candle with bullish 60m indicators and 30m as well. Price is outside the 60m upper BB. Price just busted the VWAP now at 30.5 and is testing 32.5 the next resistance area. Above that there is not much to stop it. There is a chance price will want to backtest the busted wedge and the upper VWAP band near 43 or higher. If it should get carried away there is still that diagonal from the October '09 lows across the recent tops that runs near 55 now. You meed to keep an open mind to that fall having been a 4th wave.

AUD/JPY - weekly 200ma is near 86. I do not expect that to get hit or busted. Testing the 200dma right now with overbought daily indicators basically matching the SPX daily's (imagine that!).Price is also at the upper end of a resistance range. 

SPX Daily - 23% retrace of the move off of 1040 in three days. 27 points in three days is a bunch. I'm proud of the bears (especially late yesterday). SPX did set a lower low near the close yesterday. Let's see if price can stay in the channel down after the open. The indicators here look to have finally rolled over. Form of this pop will tell a lot. 32.5 is the 38% retrace point off the top and 37.5 would possibly make a triple top if it should get there. Most now have the top in and have 1 down completed. Where we are possibly in 2 (not 3 anymore with the pop this am) IF the top is in. 
$DXY - Busted possible HnS neckline last night. with the dailys still weak and the weeklys trending down.

Gold -  1310 has been my target for a long time now. Dig the 13 print on this chart. ABCDE the wedge is done. Pullback to 1060 to 1015 and then buy the hell out of it.

Bears still have to remember the "promise" of possible QE II, POMO, EOQ prints and the election season. All of those give support to the bulls. Bad economic numbers continue to be ignored. Gold and MF outflows where it is tell the whole story. Bulls beware.

As for near term action, let's see what this pop has in it. If it gets over 35.5 I'll be surprised. It will cause oversold 30m indicators to all go buy. I do not like a breakout from here, but I am not ruling it out. Some say the top is in. It could be, but I'm not going there just yet. Sticking with my ABC call (we're in B now) looking for 1116 to 1107 then one final climb. Now, the top can be in and we're in 2 corrective here which would make next week every bearish. I'll throw out that on the minis it looks like that move was only a 4th wave. I have been screaming form, form, form of the fall. That will be the key to tell us if the top is in.

GL. thanks for the views and support. Have a great weekend, and don't forget Shanky's Dark Side where I call all the intraday action.

Thursday, September 23, 2010

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

Shame on you government for thinking you could "estimate" something and get it right (is that an oxymoronic statement?). They failed miserably yesterday with the housing number "estimate", and as I mentioned in last night's post that you needed to be ready for the jobs number this morning. Initial Claims Miss Consensus, Jump Higher To 465K From Upward Revised (Of Course) 453K With 20 consecutive weeks of outflows (and counting) from domestic equity mutual funds, I would say the average investor has had enough of the lies and falsified data as well.I am so Fing tired of the bullshit the "experts" spew on CNBS.

Economic Calendar - Existing home sales and leading indicators still to come at 10:00. Natgas at 10:30. Volker speaks at 1:00. Fed balance sheet and Money Supply after the bell. Durable goods and new home sales tomorrow.

Yesterday I called for a drop to the 200dma and then a reassessment. We're almost there. Yesterday the market basically closed on the August high support giving the bulls reason to think their run still had a chance. Well, that level will be toast this morning. Next stop (as I called yesterday) will be the 200dma at 1116. The minis stopped right on 1117 this morning and the SPX may find this 16 level pretty quickly. The wedge is clearly busted.

Minis - /ES 60m -  Wedge bust and backtest yesterday and then the channel got dusted in that 17 (seventeen) point tumble this morning. The 60m 200ma was taken out, the lower BB was taken out. the lower VWAP band was taken out. Folks this was a major dump and screams the bear are back in play. I have been calling for impulsive selling and the last few days we have seen the bears trying and having more success (even against POMO), yet the success is coming pre-market for the most part. It is happening.

SPX 60m - Looking for that 88ma to snag it at 18. Then the gap at 13 and the 38% retrace at 07. I have been writing for some time about form of the fall any significant break of th 385 retracement and the likelihood of this fall becoming more severe goes up.
SPX, TNX(10yr), USB(30yr) and VIX comparison chart. This is one of my favorites. The position of each tells a dire story, and the VIX divergence (and explosion to come) is out of hand. TNX prices SPX around 775 right now and it is still falling.

Comparing some foreign markets with the SPX. Japan is lagging or are they leading?

Comparing Gold, Dollar, Oil, SPX and the TNX. SPX above oil is interesting. Something should give there, and I don't think oil is coming up.

As for today's action we have to see how well it holds that 200dma. The next stopping point will be the 50dma and support near 1100. Form, form, form and impulse selling, that is what we are looking for. It looks a lot like we has a 1 and 2 off the top and we're beginning a 3. the 38% retrace level is key. The gap at 1110 to 07 area should be important. Will it end at that 200dma? POMO, bid stuffing, and data manipulation still live. In the meantime I'll be enjoying this big red candle this morning.

GL and remember I call it all real time on Shanky's Dark Side.

Wednesday, September 22, 2010

It Is Not Getting Any Better

Well, for the bears it got a little better today, but that should be expected. Let the no QE Douche hangover for the bulls begin. One thing is for sure, that ramp from 1040 did nothing to help keep Joe six pack in the market. The 20th Consecutive Week Of Outflows is proof enough that the sheeple are catching on and that not many want to stick around for this coming fall that will at least resemble the fall in '08.

Now, finally, we all know nothing is improving and are sick and tired of the government lying to us. Evidence of the most recent non-truth comes in the form of the housing numbers from this morning. As Denninger points out in US Home Prices Declined (What?!) "The previously reported 0.3 percent decline in June was revised to a 1.2 percent decline. The unusually large revision mainly reflects the addition of new data from late June that show considerably weaker prices than earlier in the month." is from the release and it gets this response from Karl, "The data from June was literally made up for the end of the month. And the "revised" numbers are four times the decline originally reported." I'll add that you should remember the jobs data from the post Memorial Day report where they had to "estimate" the data for eight states. I would expect a revision there as well. In the category of cheating at the game try this on for size - Did Bill Gross Just Confirm On Live TV He Has An "Advance Look" At Non-Public Fed Data?

As for the markets telling the truth (following the "promise ramp" that QE Douche might actually get announced in the FOMC minutes) both Mish and Karl (and me) point to the treasuries relationship to the SPX. Mish has a great post in Curve Watcher's Anonymous Investigates the Question "Is the Bond Bull Dead?" "The pattern may not continue, but for quite some time rising treasury yields have generally been directionally aligned with rising equities. In three instances (the first three red boxes), a drop in treasury yields preceded (led) a subsequent drop in equities. The fourth box (where we are now) is unresolved." I'm sure most of you that have seen me post THIS CHART and know the weekly TNX values the SPX somewhere near 800. Denninger in The Folly Of Investing Today  "Here's reality folks.  Over the previous 10 years the TNX has never declined meaningfully without the S&P 500 following it, and declining to near or below it on a comparative basis." 

And the money post of the week from naked capitalism Steve Keen: Deleveraging With a Twist is an exceptional post covering debt and the recovery that you all must read. This post does a great job of explaining why we pasued and had the recovery and why we'll fall in the future. "The rise in aggregate demand supported a recovery in employment, but the prospects of this continuing to the point at which economic activity booms once more are remote: with debt levels as high as they are, the potential for further deleveraging still exceeds the worst that the US experienced during the Great Depression." I keep preaching deflation and default and I hope you are listening. "With the debt to GDP levels for all non-government sectors of the American economy at unprecedented levels, the prospect that any sector can be enticed to take on yet more debt is remote. Deleveraging is America’s future."

Oh, and if you actually think things are getting "better" you need to read this 20 Signs That The Economic Collapse Has Already Begun For One Out Of Every Seven Americans

GL out there and have a great evening.

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

FOMC is over, gold is at all time highs, dollar is falling like a rock and POMO continues. Kinda makes you wonder if anyone in DC has checked the National debt Clock lately? Goldman throws out the possibility of QE Douche being announced in late November just to keep the possibility of that happening out there which keeps the carrot in front of the bull's horse for another couple of months. That is a huge warning sign for the bears since the simple "possibility" of QE Douche ramped the SPX 100 points from the cliff at 1040 to here and might exist as a backstop for investors (those that are carbon based and left in the markets) to ignore lesser than perfect (to be revised) economic data. Gold tells the real story and as it continues its ramp to my 1310 target (yes, I think it will have one last pullback before the mega ramp), the money flowing there continues to tell you that everything else is a farce.

Economic Calendar - Petrol at 10:30. Tomorrow is a big day with jobs, home sales and leading indicators. Throw in Natgas for you UNG fans as well. Friday has durable goods and existing homes.

So are we topping? I'm still in my corrective to ramp camp and looking for some sort of near term top here. Same story as the past two weeks. I had pointed to the FOMC announcement as a key date and I believe a near term top was set yesterday. That is yet to be proven until someone at the BD's remembers to flip the stitch on HAL9000 to "normal" from "buy only". Greed rules and you are witnessing the greatest money grab that will ever occur in the universe. The BD's ball is rolling down hill gathering speed in an unregulated environment. This is something you have to come to grips with. Yes at the bottom of the hill is a large deep cavern that their ball will fall off and it all will end very badly at some point, but till then they are acting like a cornered wild animal fighting for the last scraps of wealth left on the planet. I've been calling for an "external" event of a LEH type magnitude to end it all for well over a year now and that is what it will take to rip control from the unregulated crooks running the system and bring everything crashing down to face reality.

SPX daily - Here is the wedge that the whole planet is pointing to at this point. Same story as the past week everything is in place for a turn except for ADX and the confirming MACD bear cross. I especially like the divergence in the $NYMO. A warning that these indicators mean little in a non-regulated environment with the promise of QE Douche hanging in front of the bulls in a market that sellers have apparently abandoned.
SPX 60m - A closer look at the wedge and extended overbought diverging indicators.Comparing the last top to this one reinforces a call for a turn here. I especially like the double MACD divergence and what appears to be a more extended overbought  market than at the last top. 
I hate to sound like a broken record, but till the sellers can show up in mass and prove they can make a stand nothing happens. Maybe now that the FOMC meeting is done it is time for a pullback. The weekly upper BB is at 1148.32 (the high yesterday was 48.08) and the January high resistance in in that neighborhood as well. Those should act as some sort of a cap on price I would think. Lots of support has been set (see green arrows on the daily chart above). As for upside continuation lets look at the A=C level near 1170. Today is another POMO day (Friday as well) and as long as they have the bullets they will use them.

Lets start with looking for a pullback to the 200dma at 1116 IF the sellers can gain any traction. The 38% retracement is at 07 and there is a gap at 10. If not, then don't be surprised to see the ramp continue. At this time I have that 70 number as a max.
GL out there and don't forget Shanky's Dark Side where do a lot more TA, and I call the action all thru the day.

Tuesday, September 21, 2010

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

No post tonight Little Shanky 1 tuns 10 today! 

12 of the past 14 daily candles are green and we're up 100 points on the SPX (or 835 DOW points). I'm comforted to know that our markets are resilient and even more glad to know the recession is over. All this hogwash about POMO and manipulation is just that. Our debt levels are no big deal and the financial stability of the banking system., although weak, is improving every day. The consumer credit issue is way overblown and corporate sales/earnings should be stellar this year. The RE market is stabilizing and we should see rising sales and valuations coming back over the next 6 months.

OK - what you just read is a script I was preparing to highlight all the major points the CNBS and MSM need to cover every morning. It is all a bunch of shit (except for that first sentence which is real, but still a bunch of shit). Reverse all those ridiculous statements and you have the truth. I think I may have gotten one of my "external" events with the foreclosure fiasco.  Not sure how the government will pressure the legal system to cover this one up, but hopefully we can find a judge or two left with a backbone strong enough to stand up for what is right and allow the truth to come out.

Economic Calendar - Housing Starts Zoom 10.5% in Surprise Sign of Optimism was a surprise (if you want a reality check and not a propogandized POS post read ZH'a Housing Starts Bounce Along Bottom, Hit 598K, Beat Expectation Of 550K As Housing Inventory Surges and now all we have to do is wait till 2:15 and see what the FOMC has to say. 

Boy can they make being a permabear hard these days. I have warned about today's FOMC announcement and the lack of economic data for over a weak now and how that could give the markets a free run. It is amazing what the "promise" of additional stimulus can do to a market. I don't expect the Fed to say anything stupid that will disturb the markets. Today is NOT a POMO day. Markets are wedging and what is and is not priced in from this announcement is anyone's guess.

Daily SPX - (Chart best viewed here) The gray diagonal marking the lows from October and the tops from the April high is possibly the key. Combining that with the weekly and daily upper BBs and several other indicators we're nearing a top. We may not be there, but she's close. the indicators on this chart are at a point where a top can come at any time, but they can also run for a while as demonstrated earlier this year. 
SPX 60m - Well the 30m has run thru like 8 divergences and the 60m had smashed a few of it's own. The markets have run for virtually three weeks without any sort of pullback to speak of. Can this wedge be real? Can the triple top actually have meaning or are the bears wishful thinking that reality will set in and the POMO runs and algo driven ramps just getting warped up? We'll know at 2:15 after the FOMC.
Minis daily - The pink diagonal is the S/R line I'm watching. 
 Minis 60m - 52 should be in the neighborhood. This line is used to provide a range and not exact points. I think you have to put the overbought market, the triple top and this S/R line all together and get some sort of resistance. Under normal, meaning non-fraudulent, non-rigged, non-POMO conditions I would be screaming top is coming soon. The weeklys are even closer than they have been.

The mongo HnS on the range bound financials

I am in the blow off top camp, but still holding to the ABC call where we retrace something, possibly 1100 or to the 50dma) and then have one last pop to the elections. I am not discounting the continuation of this fraudulent ramp to the 1150 area. 1086 invalidates all EWT counts (whatever good that does, cause they are all wrong all the time anyway). Quarter end is just around the corner and that is something to seriously consider. Pension funds are going to go bust if the market fails which is something to consider. The government must have the markets up and juicy till the elections which is something to consider. POMO is alive and well. HFT and bid stuffing is alive and well. Bottom line is the sellers left in droves and the markets have had a free run and until we get the catalyst I have been looking for and until we get some form of impulse selling where the bears can maintain some sort of momo this can continue indefinitely no matter the fundamentals behind the market.

GL out there. 2:15 will be the key. Don't forget Shaky's Dark Side where I call all the intraday actions and provide even more TA.

Monday, September 20, 2010

Trying ...Not....To.....Rant

It is so hard to keep composure here and not totally go off on the lies and monetization while they rape and rob the middle class all to save big brother's ass (and all the GSE's including the TBTF's) so "he" can continue to be all in all to the ever growing masses of little people on the dole. this government is way out of control. The conspiracy theorists might not have had the story right but sure as hell the resulting scenarios are sure playing out to a T. This is some really scary shit. In the name of Homeland Security they can do whatever the fuck they want. Their backs are to the wall. They are desperate. They have no friggin clue how to fix anything, so they are simply flinging crap everywhere and hope something sticks.We all know that billions are sticking to the banks and nothing is sticking to the peasants.

Deregulation led to all this mess, so why don't they actually try to regulate? Well, cause if they regulate they can't manipulate. Its that simple. They can't hide worthless assets, they can't use fraudulent accounting, they can't use co-located computers to front-run every trade to scam billions for the markets, they can't steal foreclosed RE from you (or here), they can't make illegal loans (of your tax dollars) to other nations to keep their ass out of the gutter, they can't threaten you with marshal law for no reason in the name of national security (with the demise of habeas corpus), they can't do anything if they are regulated.

So what the hell do we do? We vote every incumbent out (I said every - as on both teams). We have to get the bought and paid for out of DC and get some new blood in that has a set large enough to make the tough decisions and vote for the country and not for their special interest or party. Are you paying attention to the dem's fight for life and some of the rhetoric surrounding the heated races? Just read Drudge, it is priceless, or HuffPo if you are in that camp. It is enough to make you sick, and I do believe the sheeple have finally woken up and are beginning to speak loudly about their displeasure with the government.

No one in government knows what the hell to do to fix this massive financial problem. Why? Cause no one will tell the truth that deregulation allowed the banks to go ape shit on derivatives and with fractal lending to the point that we most likely pulled 20 years of growth into the 2003 to 2007 time period. We're friggin BROKE and they can't tell you that! I think Dennigner does a fantastic job in pointing out the serious defficiencies in the government's of planning and lack of finances to handle this mess in The Only Part That Mattered In Obama's Telethon "The United States is insolvent, right here, right now, today, and The President announced it for all who cared to listen worldwide on national television."

As for the investment world tonight, Zero Hedge reads like the usual obituary for the global financial system. With Insider Selling Outpaces Buying By Over 290-To-1 In Past Week (a drastic improvement), the simplistic Divergence Update and Household Net Worth Plunges By Most Since Q4 2008, As Government Borrowing Surges you get a concise picture of the broken markets ramp for no reason. Well there was one clear reason Fed Injects Record $5 Billion Into Stock Market With Today's POMO.

Where do we stand on the takeover of pensions, 401k's and IRA's and their forced purchase of treasuries "all in the name of national security" courtesy of homeland security from our socialist government? Well' we get closer every day. When crap like CALPERS loaning $2b to the state so they can potentially become a GSE when everything collapses cause Cali can't pay their IOU's on a $19b deficit and Recently Introduced Actuarially Unsound Methods Hide Pension Mess in Illinois, Texas, Ohio; $3 Trillion Pension Deficit in Total from Mish are in your face, scary as shit scenarios cause these are real problems.

I know you are getting it now. I have found new faith in the masses awakening. Cocktail part talk has turned 180 degrees in the past 6 months.I don;t have to scream as loud, but I will continue to beat the dead horse. We're fucked as a nation if we don't act now, so please get out there and do your part.

Tempted To Call A Top

Finally completing a 61% retracement of the fall and price is now in the neighborhood of the diagonal that marked the major lows before the April high and has now market the tops since the low. This is a neighborhood thang not an exact science. Since price tends to stop near this line, price could swing up to that heavy red diagonal running across the April high near 64 now (don't think so, but it is the new bear market resistance line off the top in '07). With POMO, EOQ and the FOMC tomorrow I believe the markets will need a catalyst. I really don't think the Fed is going to screw up the party announcing something the upsets everyone. Note that the VIX is up since 09/15 as well. The NYADV is diverging the way it did at the April top. NYMO has possibly peaked. ADX is close. Most are seeing a gigantic overthrow of the wedge that began in April that can be seen on the daily chart in the post below (to those seeing a breakout - more power to ya). Daily RSI almost at 70 (69.01). TNX is somewhere in the tank. CPC is a tough read, but I think it is bottoming in correlation to where it did in the first bear phase or P1. SPX 30m on it's possibly eighth divergence maybe? Can't wait to see the ISE numbers later.

What is holding me back? POMO, POMO, EOQ ramp, excessive manipulation, bid stuffing, HFT and the elections.IMPULSE SELLING. Not till you see the bears show up in mass will this puppy let go, then we have to watch the form of the fall.

Sorry for all the lines, but this is a work chart.

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

It is all falling apart, but you'd never know that listening to CNBS or any other MSM outlet. Global tensions are growing and the U.S. sheeple are waking up (several years late of course). Several PIIGS have extended the dream about as far as it can go. The markets are ramping into the possible QEII Fed announcement tomorrow at 2:15. We all know that POMO operations are ongoing. I still contend that this market is all "they" have left between them and total anarchy and they will do their best to hold it up as long as possible (especially thru the elections). Sadly all the extend and pretend will do is make the pain on the backside that much worse. When the LEH type catalyst happens the destruction will be of historical proportions.

Economic Calendar - Housing starts in the morning and the the Fed at 2:15. Nothing else today other than POMO fund raising.

I still contend nothing happens till tomorrow. The bears look to have an itchy trigger finger this AM. They must show up in mass with reinforcements and with conviction to sell off this overbought range bound mess. Houston, we need and impulse. When you finally see that first huge move, you'll know what to do and the turn will be in.

SPX Daily - Overbought, but as we witnessed in April, it can remain this way for some time. Last Thursday I got the MACD hist decline I had been looking for. Some sort of turn soon should only be a formality now. 1130 resistance has been met.
So, here we are again. I'm looking at something similar to the top in August. When it goes, it goes hard. 1116 is the 200ma, then the gap at 1110 and then the 50ma and 38% at 1093 are your major targets. Upside.... I guess I have to consider it .... OK, considered. ABC to the top of 2 or is this the last top? I have been calling for a pullback to to the 93 level and then a final push to the top. I began seriously questioning that call late last week as the possible triangle is in play and we're ending that formation. Again, form, form, form will be the key. The size and speed and length of the first fall should be enough to tell us if this is it or now. If it is, then it will be the beginning of a third wave which are brutal. 940 is my target.

GL out there this week and have you powder dry for tomorrow afternoon.

Friday, September 17, 2010

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

Bernie Marcus for President! He made CNBS watchable this morning. Get the clip if you can.

Not triple but quadruple witching Friday. Yeeehaw! Its all about the Fed. Minis were up as high as 32 last night opening up a whole new realm of price possibilities to the upside. After they remained relatively range bound and significantly under priced compared to cash (IMO) they have now leapfrogged back into the lead. Price continues to consolidate in the wedge and eerily fractals to the rise in July.
Shall we compare the AUD/JPY to the minis?  This week had been a bit extreme if you ask me. Overnight after the mega spike (that everything on the planet took part in) it has begun a pretty strong pullback.

Minis 60m for a closer look at the wedge that has now met the triple top and taken out prior highs. Price consolidation to resistance is very apparent. Keep your eye on that gap at 08 and the 60m 200ma.
SPX daily -as I have been saying all ingredients are there but the confirming MACD cross. There is still room to run. RSI 14 and the ADX both have a smidge to go, but IMO have met recent criteria to top. TNX to SPX is a bit extreme.
Not much to say. I think we may get some more volatility today than we have had and the risk to the bears of more upside has been opened with the spike in the minis rising above cash. I believe nothing major happens ahead of the coming Fed meeting next week. Art Cashin warning of the possible break of the 30 to 330 range and buying algos going ape is a horrifying possibility for the bears. Quadruple witching Friday. Anything can happen.

It looks like the wedge has definitively been busted this time as price consolidates under resistance. I am still voting for the ABC to higher highs. It could have one last pop today but does not look like it at this time, but it won't be much. Down to 92/80 range then the final pop to keep it elevated for the elections as POMO plays out. If that is wrong, it just crashes from here. Be patient. Look closely at the form of the fall. That will be key. How impulsive it is will be the tell.

They have the market right where they want it. Don't think for one minute they don't know where it will close today. I'm betting flat if the candles are anything like they were at the top in early August we may get a big down move only to recover to close at even. If the minis take out 19 it could get interesting. That gap at 08 could be in play.

GL and have a great weekend. Thanks for all your views, donations and support.

Thursday, September 16, 2010

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

Manipulation. Are there any questions? Are they running out of bullets? Well, other than controlling the markets, rampant rumors, accounting fraud (which may be getting questioned) and the largest printing operation in the universe they have nothing (I hope you got the joke there).

Economic Calendar - Reaction to jobs data was muted after a brief spike. Philly Fed and Timmaayyy at 10 and Natgas at 10:30.

This has been an enormously frustrating month for traders and prognosticators like me. Fortunately I warned against the lack of economic data from the middle of last week till today, POMO and the missing 5th wave on the RUT and all along have not fallen for the myriad of divergences that have shown up on the 30 and 60m charts. I have also warned that the daily MACD was not ready and have been looking for the hist to put in a negative candle to possibly mark the top. We got that yesterday, and the data stream had been turned back on. The holiday may be over.

SPX 5m -  See the two gray rectangles? Miserable trading as the market appears to be trying to roll over. You wonder why I am pulling my hair out on Shanky's Dark Side trying to call this mess daily? Here is the reason.
So, what now? Well, there are still two very broad scenarios. POMO ramp jobs continue and the market continues it gravity defying levitation act into the election or 940 happens pretty quickly (thus my continuing call for either the ABC up or the ending top here). What the market must have is a catalyst (this is now a growing consensus opinion). Not the LEH event we've all been looking for, not yet, but something that will put us on the path to that event. We need a bank in the EU to go under. Everything is in place but the sellers. This is not a time when you can come out of the gates and make a definitive call.

SPX 60m - I adjusted all the lower diagonals on the wedges to include the fall yesterday. Where these lines should be is still anyone's guess. It could have broken down yesterday. The upper diagonal could be in question as well and this point in the wedge could be an overthrow. No matter how you draw it, it is wedging and price is consolidating under resistance at 31. The last rising wedge (small red) is still actually in play where both diagonals from that formation remained in play yesterday.The divergences and cracking (black) indicator trend/support lines combined with the wedge formation say we're either there or will be very very soon.

Bottom line is do POMO ramps continue? The weeklys have rising indicators that don't have far to go to get to the top lines where they can turn and the candles there are miserable. The dailys have all the topping criteria except for the confirming MACD bear cross. I do caution that they can embed and still have some room to run to extremes as only the minimums have been met. SPXA50 is finally over 400 (a major signal for me that a top can now happen). Price has still not hit the August highs on SPX, DOW, NAS or rut (SPX and NAS are very close).

I have also been preaching form of the fall. We need impulsive selling to get this bad boy moving south. We have had none of that. I think we top near here if the top is not in. I think we'll know at 10:00 with Geitner and the Philly Fed what we need to do. What happens from here? It all depends on form. If it is massively impulsive, then bears will be happy. If not then we only have a corrective and I'm afraid more upside (C wave) is to come. Without an event of some sort the markets will not do a darn thing. Sellers and volume have been non existent.

Call A) top near here if the top is not in and B wave to the 92 to 80 range then a run to the final top (ABC to the top of 2 of 1 of P3).

Call B) top near here and the ass falls out and we get to 940 within a month max (this is 2 of 3 of P3)

GL and thanks for the views.

Wednesday, September 15, 2010

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

QE, no QE, currency intervention, monetization, HFT and other lovely market related actions all in an election season that is full of surprises so far. So much crap is going on right now it is hard to sort out the market movers. The FX market may be wagging the tail again for a few days, and then the lack of economic data honeymoon ends next week (actually tomorrow).

Economic Calendar - Empire Mfg disapointed this AM. "The degree of optimism about the six-month outlook continued to deteriorate, with the future general business conditions index hitting its lowest level since early 2009." 9:15 - Industrial Production and Petrol at 10:30. Tomorrow is a big day with PPI, jobs and Phily fed. Friday is big with CPI and Sentiment and Monday we get back into the meat of the data beginning with housing.

SPX 60m - Patience Grasshopper, and apparently patience will pay off as the indicators take cues from the divergences and break their support lines. That RSI 14 is the key IMO. Now, can this move take RSI14 thru 50?

SPX Daily - Once again everything is at least minimally in place but the daily MACD. I want that hist to start falling and then we can finally talk about some sort of meaningful turn.

Just so you can see what happened with the Yen futures last night and if you were wondering what pure currency intervention looks like here you go. That is a 3% move which translates to an obscene amount of money and raises a massive red flag about Japans economic and financial future.

Bears will be happy with the open this AM, mind that gap. Sadly their push for the August highs is apparently going to come up a bit shy but they gave it a damn good run. Now, we have to pay attention to the form of the fall. will this just be a B wave or is this it and that was the last exit for longs for several years (no- not kidding). This month ends the quarter and you should suspect the mutual funds to want one last good statement, so that is something to keep in the back of your mind (and it fits with my possible ABC idea).

So, down we finally go. If it gets impulsive then you can expect the worse. I would expect with the right news or data 1040 gets gapped thru and next stop is the 10 or 00 level with the ultimate target for me being the 940 range. If it is not impulsive, then the bears will continue to be frustrated. For now I like 97, 92 then 80 as the primary targets. The daily 200ma is as 15 and the 50 is at 89. Those will be support as well. Watch the form it will be the key.


A couple of stories that I found interesting yesterday:

IMF fears 'social explosion' from world jobs crisis

"America and Europe face the worst jobs crisis since the 1930s and risk "an explosion of social unrest" unless they tread carefully, the International Monetary Fund has warned. "

and this one pissed me off,

Feds Spent $800,000 of Economic Stimulus on African Genital-Washing Program

"The National Institute of Mental Health (NIMH), a division of the National Institutes of Health (NIH), spent $823,200 of economic stimulus funds in 2009 on a study by a UCLA research team to teach uncircumcised African men how to wash their genitals after having sex."

Tuesday, September 14, 2010

A Few Interesting Things

Denninger keys in on Want To Know What Fueled That Reversal This Morning? nicely. No kidding, what sent the dollar falling off a cliff and the AUD/JPY on a ramp that would make Peter North proud? Tell me please? QE II baby, a simple PREDICTION that this is going to happen sent the markets scurrying. All is well! The will be riding in on their white black stallions coming to the rescue. I now have two words for that announcement SHOULD it happen, "priced in".

Wait a minute. In the "not so fast my friend" (lord I'm happy college football is here) category Zero Hedge has False Alarm: Morgan Stanley Recants From Its Expectation Of A QE2 Event In One Week where we learn (knew the anticipated QEII was a main driver off the 1040 lows along with some estimated jobs data and a GDP that looked like my freshman GPA - not to be revised) that, "Sorry, no QE2 for at least two months, and most likely not until January, but which point it will be too late to do any actual good to the economy (but not to surging gold prices)." What - a RUMOR? Heavens no. LOL, nothing like a free 80 point ramp for the PPT going into elections on a RUMOR that the Fed would come to the rescue. Oh, about that "priced in" thingy from above - you are about to witness a new term, "priced out". TA has an amazing ability of predicting things and has been pointing to a top, maybe this is it. Hard hats are not optional.

Some of you may have already forgotten that retail sales numbers were released this morning and they were "better than expected" as expected (since the government mandates all first data releases to be "better" the to be revised). Mish has a great post on the subject and brings into question the validity of the "better" data based on sales tax figures. In Retail Sales Rise .4% from July - How Far to Pre-recession Levels? Where to from Here? Mish has, "I wonder how long it will take the Census Bureau to do a major revision, but as it sits, the retail sales report data is totally screwed up and paints a much brighter image of the "recovery" than has actually occurred." I am positive that that statement could become a blanket statement covering all data from all government sponsored sources (just use CNBS as an example of that).

GL and thanks for the views.

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

Retail Sales beat estimates. Whatever. If you think job and credit conditions not to mention the closure of under performing retail stores across the nation matter at all, then the government's estimate is a crock. Did you know that sales for July were downwardly revised. No surprise there and it won't be when these are revised as well. Government mandates numbers to never disappoint. More detail on Retail Sales HERE.

Earnings Calendar -

Last night on Shanky's Dark Side I posted this minis chart. The blue line is the most recent market top line resistance coming off the top in April. This is a clear A-E wedge that has consolidated yet not shown any real retracement (again government mandated no retracements). This is a 4hr chart. MACD hist is about to bear cross, S Sto is there and RSI is falling. All the ingredients are there to bake the cake.

SPX 60m - Even the CNBS people mentioned how sick the internals looked this morning. That is definitely against government mandates (someone will get a spanking for that I'm sure). This 60m chart says it all right now.RSI14 crossing the 20ema and then that black support diagonal is the signal.

The 30m charts setting double and even triple divergences. The 5m chart with a long divergence and a blow off top. All the indicators on the daily in place but MACD. SPXA50 at 399 (400 is my magic number) and $NYMO are there. We're setting up a better top than I anticipated. Weeklys are not there yet for the big turn, but getting closer. 

I'd been warning that there was a missing 5th wave. Now, finally form appears to be complete for this 5 wave move. Shortie should be safe for a few days I'd think. I'd be very surprised if that SPX top I called yesterday at 10:58 on Shanky's Dark Side gets busted. The ONLY snag is the daily MACD. I'll be a lot more confident when we finally get the daily MACD hist to put in a down bar and get the signal cross.As for the bigger picture, the weekly charts are still screaming although the weekly candles are pretty dismal. I'm still leaning to the ABC here with the form of this possible pullback being the key. Right now I'm looking at 92. If that gets busted or the retrace goes beyond 50% near 80 (the number I have liked for a long time now) in some sort of impulsive fashion then we could be looking at some sort of major move that takes us below 1000 (940 is the range I like).

So, are there any sellers, or should I say are there any sellers actually left out there. Will this manipulated market yield an inch before the elections? Is there enough complacency now where a turn can happen? We'll know soon enough. In a news driven market without an event then up is still very much a possibility, but the bulls are losing momo here. Opex week will weigh on the markets as well. I still think Thursday is the key day when we finally get back into heavy data.

GL and thanks for the views and support.

Monday, September 13, 2010

Will the Madness Ever End?

You are in one camp or the other, you either want to get it over with or you're hanging on praying please no. Well, to those of you on your knees, your prayers have been answered. Lord Bernanke and his First Lieutenant Angel Geitner herd you and have declared Primary Dealers Prepare To Invest $27 Billion In Fed Money, Levered 30x Over The Next Month, To Buy High Beta Names. What does this mean? Well as ZH interprets it, "the New York Fed has just disclosed it will buy $27 billion in Treasurys between mid-Sept and mid-October. Using the Basel III blessed 30x leverage, this money, once it makes its way to the Primary Dealers, should be sufficient for a $750 billion leveraged push higher in risk assets. And just to prove that point, there will be a POMO on both Wednesday and Thursday. You didn't think a politically "impartial" Fed would allow a  market crash before the mid-terms now, did you?" I've been on my soap box about the markets, elections, riots and the market being all "they" have between them and total anarchy and that they will do anything in their power to keep it up as long as possible. As a commenter on ZH put it, "Risk on bitchez!" I'll call it Pump-n-Dump Supreme. you buy it, they sell it and haul ass out the back door.

So, are we about to enter a full frontal "risk on" mode? With Big Bond Bubble Beckons Bears, Buries Treasuries, And Busts Fixed Income Investors Yelnick does a nice job (as always) dissecting the charts and putting the potential diaster into perspective. "What did happen was the Euro debt crisis drove money to safer havens in Treasuries, and the pronouncement of a continuation of QE led observers to expect a bigger QE2 ahead. Bonds soared as rates dropped. In the last few weeks, however, we have seen them reverse dramatically." I posted THIS CHART on The Dark Side yesterday afternoon. Stockcharts PnF of $TNX has the bearish price objective of $25 as met. Something has to give as the SPX is flat out running away from the TNX.

Denninger's concerns  over the Dollar/10yr/futures price action is explained nicely here in Now We Got Problems...... "There are two "nightmare" scenarios that I have been concerned about for more than two years.  The first is an equity sell-off that comes with a big selloff in Treasuries.  The second, which we may be seeing the start of, is a selloff that comes with a big dump in the dollar." He's right on both fronts.

Denninger also covers The Genesis For The Next Crash. Read the "Here's how it will happen." portion.

For those still poo pooing market manipulation - This can not be disputed, the actual prosecution (potential admittance?) of Trillium Brokerage in Well Well Well.... (FINRA / HFT / Manipulation) and Zero Hedge covers it in First HFT Casualty As Finra Fines Trillium $1 Million For Quote Stuffing And General Market Manipulation (Again)  

The debate over inflation is spiking the headlines again. Mish got into the act with  Debating the Flat Earth Society about Hyperinflation "Hyperinflation could theoretically come from massive sustained political will to bail out the little guy at the expense of the banks, the wealthy, and the political class. However, unlike Mugabe and Zimbabwe, neither the banks nor the Fed nor the political class wants to bail out the poor at the expense of the wealthy." It is a long and detailed post, but worth the read. Me, I'm a pure deflationist. It is the only way out. We have to deflate everything globally to a point where we can afford to manufacture again. How else are we going to put everyone back to work?

Well, there you have it. To put it in a nutshell, inflation is not going to be a problem as the "risk on" trade is running over 100mph, the markets are rigged and will not be allowed to correct until the elections (or all the insiders are out whichever comes first), the bond bubble is about to burst and Harrisburg, Pa is drowning, the EU banks are in just as bad of shape as ours and Greece (or another PIIGS) add to all that 112 Stocks Now Account For Half The Day's Trading Volume and the gargantuan RE and CRE issues that exist and POOF there goes America. It won't be long now.The only question is when.

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

Nothing like the certainty that the global economy is crashing, the banks are all really insolvent, the consumer is dead and coming in Monday morning to the futures up 9 (actually 3 off the high) and all because some moron decided to let the banks in Europe lever on up. Wasn't there a lesson to be learned from fractal lending with drastically overvalued assets backing up the capital? This is like a nightmare. Extend and pretend till the next LEH incident. All is well in the land of unicorns and fairy tales. You can not fight the system.

Economic Calendar - No real big days till Thursday. Today you get Timmmaayyy and the Treasury budget at 2. tomorrow morning Retail Sales and Business Inventories.

Cash may want the gap from 16.89 to 21.06. The Island closes at 17.89. The double top is 29.24. 10.10 is the 78% retrace that really should not be violated. If it is and held, then the bears need to rethink what the hell is going on and get on board with Team Manipulation. I personally think this will be a blow off top as we finish the 5th wave of this A leg of the ABC or as we finish 2 of 1 of 3. A pullback to the 92 to 85 range then a pop to possibly as high as 1040 is possible. The 1100 to 97 range is now solid support. There is not data to really spook the market till Thursday (data we can believe in). I think if you want the truth you need to simply look at the Gallup numbers to cut thru the crap the government is spreading. Sadly, reality does not drive the markets. They keep on doing what any good soldier does in a fight for life, they use any means necessary to prolong the battle till reinforcements arrive. In this case, there are no support troops and they are down to their last few bullets.

If the weekly topping process holds I'll be looking to get the SPXA50 above 400 and watch for that final divergence to be set on the $NYMO. A weely green MACD hist bar would be nice as well. As for the daily chart, other than MACD everything is in place where a top can be possible. They are not strong topping signals, but most indicators are beginning to just now enter the overbought arena.

SPX 60m - Not sure if the top line of this wedge holds or not, but the wedge up is what we're looking for. You all know I hate the 60m chart, but in this case it really looks like a blow off top near term to set the C point of the A-E wedge formation. 
Sadly my 30m chart has been rendered useless as price has blown thru TWO nice divergences in this rally. Time to start looking at some longer time frame charts. We have all witnessed what they can do to the markets and suspending them in overboughtland is one of their specialties. I expect a corrective soon and the form of the corrective will tell us if this is some sort of major top or not. We have also seen that when it falls it like to do so quickly. It does not take much to make the southern momo going these days. In the meantime the ramp continues like it or not.

Don't forget Shanky's Dark Side where I call the action real time. More detailed charts and a board with some really smart people. All are welcome. 

If you want to know more about why the markets are up today please see 3 Out Of 3 Analysts Agree: Basel III Will Guarantee Their Bonuses For 9 Years In A Row, As Banks Win Again.

Look Into The Futures

Courtesy of Asia markets the minis are up over 9 hitting 1114! Woopie! Price has decidedly taken out the upper resistance diagonal and this is not a good sign for the bears. I think this is possibly completing the 5th wave up that I was discussing last week.

Minis 30m up close - 
 Here is the larger 4hr minis chart clearly showing the upper diagonal, the yellow resistance and support lines and the dashed pink new bear market upper resistance line. Price has clearly been range bound since May. A breakout here could be significant and price could run all the way to the mid 50's and that upper resistance diagonal. Now, they have till Thursday to make that happen. POMO Monday and not real economic reporting till Thursday could provide a tailwind to the markets. They are NT overbought. I'm still in the pullback for B wave then up camp, but I am not  discounting the possibility of it topping very soon and making a hard move south. See you in the morning.

Friday, September 10, 2010

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

Well, propping the markets into election season appears to be one theme we'll be getting used to. With Barry having to recruit people these days to come hear him speak, with other candidates running from him like he is some sort of virus and his tracking poll is hitting fresh lows at -24 his speech this morning might be more of a joke than anything. Look for him to use rhetoric to try and drive the wedge further between the haves and have nots. Divided we can not fight them. I best stop there in risk of being called a racist.

What did that have to do with the markets? I think the election has everything to do with the markets. They can not have anything else riling up the public and a further faltering market would simply add fuel to the fire at a time when they can least afford it. Yes, I'm talking about blatant market manipulation. Get used to it till we have the "event" that finally rips it from their control.

With 9/11 tomorrow I would like for you to read this post from Washington's Blog - The Anniversary of 9/11

SPX 60m - The only chart I offer today. I put a hard sell line on it yesterday when it set the divergence. The 30m confirms it. The dailys still have some room to run. This is not a major sell signal, just looking (still) for the 1080 area and then we digest from there. The 3 market possibilities are still 1) a top here and major fall 2) we're in a larger ABC pattern that takes us up to the 17 to 30 area after this pullback or 3) the markets simply remain range bound or consolidate (in the black wedge) into mid October.I prefer the ABC call at this time looking for somewhere near 25 as a possible target after the pullback to 80. 
Again, without a catalyst and as long as we have POMO, the bots and zero regulation there is no reason to expect any real downside here. Apparently 450+ job losses is the norm now and that should be celebrated (along with the debt and GDP and your home soon to be worth 50% of what it was in '07). Aren't things just peachy!

GL out there. Please remember those that lost their lives and their families on 9/11. I urge you to read that post from WB above. Thanks for all your support and have a great weekend.

Thursday, September 9, 2010

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

OK, jobs improve (that is if you prescribe to the economic voodoo they use to calculate such things). The markets reaction to the number has been very muted. The minis spiked 6 to 03.75 and since then have done nothing.

Economic Calendar - Natgas at 10:30 and Petrol at 11. This from ZH is kinda nice -Today's Economic Data Highlights: Trade Balance And Claims

SPX 30m - I've been hunting for this divergence to form for about a week now and may finally have it come with the pop this morning. What I'm seeing is a 5 here. The big question is does this 5 end the run or is it just part of a larger corrective. The only way we'll be able to tell will be the form of the fall. If it gets impulsive look out. If not, then look for an ABC to the upper 70's before the next and final ramp to the 17 to 31 area. Either way (barring some massive zig-zag consolidation) it should be ending.

 SPX 60m - Upper resistance diagonal. Indicators with divergences that should hold. Here you can see how the wedge will either form for the pop to the 17/31 range or it simply ends here at this diagonal. This chart looks weak as well.
SPX Daily - Another view of the rising wedge and the diagonal. Resistance is everywhere and given that this market can hold support, but it can not get any follow thru on the pop off 1040 should be a concern for the bulls. The upper BB is driving down on price here. the 200ms is just above. Gap resistance and then 1130 all hang over price here. It will take a remarkable effort for the Fed to drive price thru all this mess.
What concerns me as a chartist/forecaster is that we are dealing with a rigged market going into an election and they can not have a crumbling market this time of year. I don't think they can pull off the ramp here. We have to pay attention to the form of the next pullback. That will be the key. If impulsive and strong, then she's gone and we'll have a 9 handle sooner than later. If it is a simple ABC then another 5 wave structure up will come most likely. I am leaning to the fall here, but my primary call remains the ABC up. I'm betting on manipulation again. If neither materialize, take a good look at that large blue wedge on the daily chart. She could just consolidate into late October.

GL and have a great POMO day (you're paying for it)!