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Current Rally In Equities Mirror Image of February-April 2010 Rally Which Ended In Collapse
We continue to believe we are trading in extremely similar fashion to the Feb-April 2010 rally (strong support at 10-day EMA on S&P, depressed VIX, high levels of complacency, widespread overowned sectors, extreme bullishness, etc) which of course ended in a violent sell-off, and as noted yesterday we believe we are now trading at the equivalent of the April 20, 2010 point where equities are rebounding a bit off their first test of the 20-day EMA following an initial break below the 10-day EMA (see charts below). We believe like April 2010 any rebound at current levels should be used to initiate short positions/unwind long positions as equities will likely retest the 20-day EMA here shortly, and culminate in a major breakdown below all major support levels. Expect like April 2010, S&P is being forced to overshoot in preparation for deluge of negative news...in May 2010, trigger for slide was Euro crater triggered by mounting European sovereign debt concerns, expect this collapse may be triggered by USD collapse on US muni bond concerns (note significant USD weakness over past several sessions). Lastly note just under 12,000, DJIA trading at top of right shoulder of 25-year head & shoulders.
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Technically I don't think we're there yet, in terms of a major correction a la May 2010.
Pomo money is going into stocks. Muni bond bond is going into stocks. If the banks sell, there will be your crash. Otherwise, banks buy equities and hold until there is a retail presence.
Equity markets are 1/50 the size of the bond markets and if the bond market is crashing then the hot money will go to stocks and commodities. And when commodites pop, that may be a harbinger of doom for equities as well.
Making the stock market go up and creating fake asset values is a marketing technique. Its propaganda and marketing for the FED to fool people back into convential patterns of consume and spend
Collapse? Impossible as long as the credit card hasn't maxed out and we can stil print prosperity!
But Wall Street is so drunk on Fed POMO money printing that the Dow is 57 points higher at this moment. All is well, sheeple. Ignore the debt wolves at your heels! Just keep moving along toward the calamitous cliff that's dead ahead!
Hindenburg is baaaack
This is kind of absurd. The mkt is so manipulated by POMO, The Ben Bernank and The Goldman Sack that a stock index price dropping below a 20-day and 10-day MA is a correction? Are we POMO conditioned that the markets always go up with 10 and 20-day MAs? The 2008 and later hope & change technical analysis.
RUT is rapidly approaching 50dma at 766...
NDX sitting on 20dma...
The real significance is the practical execution of manipulation even has it's limits before the side effects become intolerable. I make a cautious bet that's what the market is now looking at when it looks at July 1 w/out pre-announced POMO, w/ commodities / ag too high for comfort all over. Repubs wanting to posture on camera that they're against more Fed giveaways.
Market should be a bit nervous now?!?
"Current Rally In Equities Mirror Image of February-April 2010 Rally Which Ended In Collapse".
True, but we have the double POMO whammy scammy!
I really can't make heads of tails of today's action - traditional correlations are all abandoned. Dollar weakening, commodities weakening, T's yields weakening, RUT / NAS struggling, Euro Equities and S&P continuing up. Yen strengthening against the dollar as they claim "crisis"? Euro strengthening against dollar as blah blah blah. Is it time that reality sets in just how sick the dollar is (can't imagine that dose of reality would be allowed).
What's it all mean - fugifIknow??? Perhaps the market is similarly confused?
Follow AUF/JPY
So should we buy gold and silver? Where is Turd Ferguson?
Just bought 2 rolls of uncirculated peace dollars on Ebay for 380 dollars.
It's like nobody is bidding today :)
USD collapse would result in something far greater than compared to last year at this time IMHO.
ppfffftt....
First the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
Then the dollar goes down for a month or so
Then the euro goes down for a month or so
New Bottom Bitchez!
BTFD's!!