Monday, July 16, 2012

Morning Charts 07/16/12 $SPX $ES

I'm not sure about you folks but the way I see it, revenue misses are not good. IMHO if there is one reoccurring theme over the past 4 years about earnings season it is "earnings beat but revenue miss". So they can use all the accounting gimmicks (or whatever else they have in your bag of tricks) to massage the earnings all they want, but that revenue number is just a bit harder to manipulate. C is just another shining example.

In another murky dark part of the data feed we discover that retail sales are not so hot. What makes this so murky and dark is that the stark cold reality is that the consumer is dead, tapped out and up to their gills in debt. This is a massive problem. As discussed here often in the past, it is our (the USA) job to consume and the rest of the world's to manufacture. We are the great consumer. So, what happens if we can no longer consume because we're totally tapped out? Now, go figure that this horrific situation is a rallying cry for the markets because it deems more easing from the Fed (which will never see the light of day on main street). That's really screwed up.

On The Verge Of The Ultimate Death Cross from ZH and Albert Edwards is one of those clean and simple posts that any sheeple can get (I said that last week didn't I?) showing the coming bear cross of the monthly 50ma crossing the monthly 200ma. STB has been showing the 10/20 cross. If right I will achieve the same result and beat then by two or three weeks to the punch. You all know I have been on this one for quite some time and recently noted the superior stick save over the last two months by the Fed to stop this cross from having happened already. See the black circles, note the markets reactions and then see our current position in yellow. 

Monthly Cycle Chart

Minis 4hr - It's all about the blue rising wedge. In the OWP I noted that this market appears to be more controlled now than ever with price moving to some very obvious and almost predictable points over the past month or so. It is almost like we have entered a new era of manipulation. 

Coming from last Sunday's post where I noted some confusion in the charts (which was well documented in price action last week IMO), that confusion has not really been sorted out quite yet. I'm still not sure if we are in bear or bull mode right now. Of course you are always encouraged to do nothing but follow the Fed here at STB.

I still think we're on the verge of a major decline, but you will have to be patient and let that move come to you. You can not force or make anything happen. Earnings season is clouding or generating a haze over the global meltdown distracting near term market movement from the bigger picture. I'm sure that the charts will sort things out over the next couple of weeks and present a very clear picture. Till then I remain in consolidation mode waiting, scalping and watching.

GL and GB!

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