Friday, June 1, 2012

Morning Charts 06/01/12 $SPX

All I can say is not good. The 'not good' news is so expansive I'm not going to bother and cover it all. Let's just say global PMI is imploding and the NFP huge miss this morning took price thru the major support and to fresh lower lows. Not good.

As usual we need to place our conspiracy hats on (AFDB's for you long timers here at STB) and start conspirasizing and asking the questions regarding raw market manipulation. How long till they pull out the big bailout gun or launch the mega bailout rumors to quell the slide? Can they QE/LTRO one more time? Will they do a global bailout? Will a bailout work? Will they do it in time? Has the global systemic meltdown fuse been lit? Has the first domino fallen? Can they stop the inevitable? What sort of solution can they come up with to stop the implosion?

Enough questions? I could ask about 1,000 more, but you get my drift. Here is the deal, they must stop the core slide and protect the banks at all cost, legal or not, because if they don't the global financial system implodes. This is inevitable as the quadrillions in derivatives once triggered will be responsible for wiping out most of the wealth on the planet. The BIS, ECB, Fed and other global banking syndicates (not to mention governments) are scared shitless now and will use anything possible to save their ass (again legal or not). This makes investing very dangerous at this time.

I'll write more on all of this next week, but time to prep and get your assets out of the banks is possibly upon us.

How does all of this translate to the markets? That is the tough question. Can they get the stick save here? Will they ease and generate another impossible ramp? Do I get my plunge to 1170 (roughly 20% off the top) and then they react? It is my opinion that all you can do is follow the Fed, always remember that the markets are rigged and retain and itchy trigger finger not falling to much in love with your convictions over one side of the market or the other.

I've preached gangsta style trading since the beginning of the year and this is still in play. Hit and run is the safest play. Get your profits and get out and let the market set up your next play. Remain patient and calm not forcing anything. Do not follow your gut. Do not think something 'has to happen'. Remember the markets are rigged and the PPT will eat your face clean off.

See the chartapalooza yesterday for all sorts of charts from gold to oil.

Minis 60m - Holding the blue channel for now after spiking under support. Notice how there are no lines in the lower section of the chart? That is because price has entered a massive black hole where no support points exist other than the 200dma near 1281 as discussed yesterday. 1265 to 1250 is your next support range. More on this either later or next week.

Daily SPX - I'll do some more detailed charting next week. Remember the charts will get it right in the long run, but intervention and manipulation must be guarded against. Note the spike in the dollar and the collapsing TNX (1.47). Dailys starting to embed now as price approaches the 200dma. This is a point they MUST defend or all sorts of triggers go off. Note the long term blue support area from 1284 to 1260 price is about to enter. From the top I was walking price down to various targets and the 1260 support/fib convergence area is next. Below that is 1220 and finally 1170.

As noted I'll do a lot more charting for you next week and bring in many other components. This could be an interesting weekend. Expect the PPT to be in play and for the QE/bailout rumors to fly. I do not think they can save the markets again. I think the big slide is finally here. At best they may maintain asset levels in a broad range up here. They may have one last stick save in their back pocket, but that will be it. At this time I'd give them 1340 to 1374 as a max high, but that is speculation and not a call. I think it gets much worse before it gets better (if it can get better).

Have a great weekend and thanks for another fantastic week on the blog. Note to all the lurkers that came out this week on the comment board - thanks for contributing and you all did a great job.

GL and GB!

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