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We Close The Week And The Move
Submitted by Nic Lenoir Of ICAP
Most of the reversal late in the day was short covering, as no one wants to be short over the weekend in case some resolution comes out of Europe. Trichet could not help saying there would be no special ECB meeting just to add a bit of fuel on the fire, but no short on her/his right mind was going to expose his P&L based on this very man's word.
The big question is how we open on Monday. We have a potential bullish hammer on the Nasdaq and on the S&P future. If we open Monday above today's open (no overlap of the bodies of the daily candles) it will be very tempting to get long equities. We are looking at this market from the short-side as we believe a major top could well be in, but a bullish open Monday would indicate the market will retrace up to 1,100/1,107 which will be massive resistance now. Following this view we believe we have completed today the first bearish impulse of the sell-off started in January and which would last if we are right well into the spring. We also saw our 5,389 target on the Dax, which served us well to indicate a possible extension lower past 1,051 on the S&P this morning. We are not bearish for the very short term.
Following our observation on the possible bullish hammer in equities, gold shaped a big reversal today. There is a slew of supports between 1,011 and 991 and we would have favored waiting to see those levels to recommend buying, but if we complete a morning star Monday there is a chance a medium term low is in place and this would open up the way for $100 of upside.
EURUSD has tested the channel support and held so it reinforces our other observations.
Bund almost saw the channel resistance on the daily chart at 124.64, and 10Y Treasury futures very very close to the big resistance at 119-03 at the highs today.
All main markets are therefore pointing to possible reversal in the short-term, fixed income (bund and Tnote) being the only 2 that did not "touch" resistance... but came aweful close to it! Still we will need stabilization of sovereign credit markets to see a rebound in risk appetite.
Good luck trading,
Nic
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It is now all about risk aversion in the currency markets. Whatever the S & P does, do the opposite for the USD.
Could it be your back room deal is playing out?
Bernanke says, we need to sell Treasuries.
Trichet says, we need to sell exports, especially our southern brothers.
Bernanke says, let's start CDS momentum on the sovereign debt abusers in Europe.
Trichet says, well if we do have to bail them out in the end it might as well be us selling the CDS.
Bernanke says, Ok, but if it starts to work too well, then I will put the PPT into action. We don't want this to get out of our control.
Maybe, Nic. But I say this time it was blatant PPT action. They didn’t want the headline Dow Drops Below 10,000 blaring from newspaper kiosks all weekend because the sheeple would come in Monday and want to sell.
+1
shorts started covering when they saw the guns move in around 2:30 eastern.....and started panicing around 3 ish. i look forward to some monday in the not so distant future when the gap down is crushing. the fed can phuck around all they want on late sunday nite with the minis but they can't control it forever and as we know, they won't even want to control it once the treasury market gets out of hand.
+1
@deadhead
Exactly. As to next week, 1074 is going to be tough resistance.
Cursive....1074 right on the 50% fib level. here's a chart from Kenny who is an excellent elliot wave/classical TA guy
http://2.bp.blogspot.com/_goypolxEFd4/S2yKrccmh-I/AAAAAAAAD88/XixmHFbRSMg/s1600-h/SPX+30+min.png
i'm of the camp that we have a move down to 980-960 spx starting next week
I have immense respect for our boy Kenny.
It also seems to me that you need to make lower highs before you make lower lows.
I think we saw a huge STO bounce this afternoon, and there will be a run up long enough to work off the oversold conditions before we move lower. I'm not saying that we won't move lower, it's just, patience grasshopper.
@deadhead
Where ya been? I spend most days on Kenny's blog. I'm in your camp as well.
Is that Kenny from SKF board?
You can have better prediction by flipping a coin. All other Kenny and Idiot Wave followers please post here so that I that I don't waste my time reading your posts. Its hard enough to read all articles on ZH and last thing I need is SKFers jamming the discussion.
Dead on, deadhead. I’ve also just read your comments on another post about the PPT. Your analysis of today’s market action is indispensable in the understanding of what happened.
I’m reminded of a book by John T. Flynn in 1944 entitled As We Go Marching, with the purpose of defining the meaning of fascism and “then to search for its elements in America.” Flynn uses fascism in defining what was happening in Germany and Italy at the time and suggested that trends in America, a kind of “good fascism,” would eventually lead to the kind of imperialism and totalitarianism found in the Axis powers.
Flynn accuses the New Deal planners of creating a society in which the government would insert itself into the structure of business, not merely as a policeman, but as partner, collaborator and banker. The planners would come up with “an economy supported by the great streams of debts and an economy under complete control, with nearly all the planning agencies functioning with almost totalitarian power under a vast bureaucracy.”
Government intervention has finally taken its most ambitious step: the takeover of an honest market system represented by the equity exchanges.
well said JR and thank you for the reference to that book, which I've not heard of previously. Seems as though Flynn was quite prescient.
"Government intervention has finally taken its most ambitious step: the takeover of an honest market system represented by the equity exchanges."
Is this really what's happened here? Michael Hudson has a rather different view:
"Libertarians have warned that our economy is going down the Road to Serfdom. What they do not realize is that by fighting against government power to check financial hubris, they are paving the road for centralized financial planning by Wall Street. They have been tricked into leading the parade on behalf of the financial, insurance and real estate sector – down the road to debt peonage in a monopolized and polarized economy."
I don't know whether you're a "libertarian" or not, JR, but to your concern about "planners" and government inserting itself into the structure of business, in the present climate I'd have to inquire whether it wouldn't be more accurate to see the problem as one in which business, Wall Street particularly, has inserted itself into government. Here is all of Hudson's article if you're interested:
http://neweconomicperspectives.blogspot.com/2010/01/mr-obamas-junk-econo...
Dr Hudson's articles are always well worth the read. I appreciate that he steps back for a look at who's running the empire and their motivations, and his focus on debt and consideration of default (including sovereign default) as a real probability. He is one of the people who started me looking for the puppetmasters, rather than resenting the puppets dancing on the political stage.
He reminds me sometimes of Karl Marx. (Hopefully that doesn't scare off potential readers.)
By “government” I meant Wall Street. America’s government is run by oligarchs who are based, as nearly as we can tell, in the New York Federal Reserve Bank. They are the people who are fashioning our policies and making the appointments to the executive branch of government. I believe Dr. Hudson refers to them as a billionaire plutocracy. They are the Goldman Sachs and the JPMorgans. You can’t find any other body more centrally control-located , more government core, than the owners of the Federal Reserve--they manipulate the stock markets, they promote the bailout of Wall Street financials, they elect the presidents, they control Congress…
I’m sorry I said government, but at the moment, they are the government. It is misleading and confusing, really, to say either “business,” as you suggest, or “government.” It is an oligarchy. It is the Blankfein Class; they can be called neither government nor business. They are a gang of bandits. They are sometimes bankers; they are sometimes military; they are sometimes landowners; they are sometimes politicians, but they are ever bandits.
It’s like saying Jessie James, because he dealt in money, was a businessman, or that by robbing banks, he was engaging in government intervention.
Thanks for the clarification. I concede the point. No, I am not a Libertarian. You might say I am a follower of George Washington and a student of Aleksandr I. Solzhenitzyn. I am also an admirer of Dr. Michael Hudson.
I'd agree with the other posters here - fascism occurs when the state and the corporate sector become indistinguishable. The recent Supreme Court decision could be seen as the official ratification of corporate fascism in this country - it essentially gives corporate entities fully "personhood" rights, ironically with few of the responsibilities. Most large corporations pay little if any tax, you cannot put a corporation in jail, it's difficult if not impossible to formally end a corporation's charter. We have essentially given large pots of money, with their own staff, more rights than we give individuals. That is the essence of fascism.
I would disagree that we are in an oligarchy. Oligarchs are individuals of great wealth that control the country by dint of that wealth. An oligarchy is essentially a form of dictatorship. Corporate rule is different, in that it is the action of the managers in the service of maintaining the hegemony of the corporation that collectively control the government. It's a subtle distinction, but an important one. Blankenfeld by himself has some power, but his real power comes primarily as the CEO of Goldman Sachs. Should he retire from that position, then his successor will effectively gain the power associated with the title.
The role of government in the purest sense is to insure a stable society. When the laborer receives too little in return for his labor this results in unrest. When there is no room in the society for the potential of improvement of a person's lot in life, this results in discontent. When laws are arbitrary, capricious, and unequally enforced, this encourages lawlessness. In many societies, this is one of the reasons why the display of conspicuous wealth is discouraged - a rich man moving through a poor society will be reviled, spat upon, and threatened.
This is one of the reasons why societies that develop a middle class tend to be the most stable. The middle class establishes a gradient - a means towards advancement, a way for the poor to become established, a way for the upper reaches of the middle class to move into the circle of leadership and political control. In physics terms, the middle class creates a convection gradient that tends to reward the intelligent, talented, persuasive, and charismatic while at the same time punishing sloth, avariciousness, arrogance and unbridled indulgence.
When the middle class is destroyed, as is happening now, this convection current breaks down. The middle class who become poor not because of their own failings but due to the machinations of others become angry, resentful and reactionary. They are dangerous because many have the education of the upper class without the political power that comes with it. The upper class, on the other hand, become fearful and even more repressive (and typically much more conservative), and as a consequence the society becomes more unstable because the flexibility that the middle class provided is no longer there.
This is how fascist states evolve, and how ultimately they fail. Control is in the hands not of oligarchs, but of corporations that have no accountability to any but the shareholders (i.e., the upper class), and that only in providing the dividends that provide the real wealth of the upper class. Because corporations are not individuals, they cannot be punished - they can be fined, but typically such fines are dwarfed by their overall revenues. They can seek protection from governments against poor investments and bad judgement and will be granted such protection because ultimately the government is controlled by those same corporations.
From the perspective of the upper class, in an ideal world, corporations would have no employees, only shareholders. Everything could be automated, everything could be controlled, and there would be no need to pay labor costs or deal with the pretensions of those who are inferior. The problem of course is that the wealth on which these corporations exist ultimately derives from work done by those same laborers, for which they receive a given wage. When the upper class eliminates the need for work, they also starve themselves of oxygen.
At first, this translates into high unemployment as employees are released from work. Later, however, the more enterprising of those former employees start their own businesses, often providing better services or capabilities than those that are produced by the fascist corporations, because those corporations no longer have the people skilled in innovating new products or in meeting legitimate demand, instead relying upon the manufacturer of false demand.
Once this happens, the upper class decays, increasingly creating less real goods and more "financial services". In essence, this is ultimately what leaves to both devalution of the currency and in the end the fall of states, as the legitimacy of a state often rests upon the soundness of its currency. New currencies arise, based upon sounder principles, and often in forms that are not always fungible with the existing forms of currency.
We're in the early stages of such a process now. The people who are now unemployed are not, in general, sitting at home and subsisting on their dole - they would starve doing that. So they are creating a shadow economy - one in which transactions go across the Internet or under the table, where taxes don't get paid and people and where the substance of the transactions may or may not be wholly legal. They are creating new businesses, but the businesses may not be recognizable as such, because the people involved in them are distrustful of both the corporate and the governmental state. They are slowly beginning NOT to play by the rules of the society as it has existed, because playing by the rules will only result in losing.
This is the danger that unemployment poses ultimately to the fascist state - it makes it irrelevant. The Soviet Union collapsed because its "legitimate" form of government (and the economy that it officially supported) was no longer seen as legitimate by the people, who instead chose to be involved in the gray and black markets, chose to circumvent the societal rules that existed (even at the cost of imprisonment or death) and instead chose individually and ultimately collectively to change the rules. I believe the United States is destined to fall the same way.
This is also why, the talking heads of CNBC aside, an economic recovery without a jobs recovery is an oxymoron. The longer it takes for the latter to manifest, the more irrelevant the supposed economic recovery will end up being, because it ultimately ends up involving moving markers around in a game that has little to no relevance to the overall population.
Additionally, there's a danger of escalation that the fascist corporate economy risks causing. People are not marching in the streets yet in the US because there are still opportunities to ake wealth. Remove those opportunities, and strikes begin. Send in troops to quell those strikes, and this increases the level of response that will be made - you go from strikes to rioting. Riots are disorganized and spontaneous, but when rioting goes on long enough, people become organized - something especially easy to do in this day and age.
Once that popular organization happens, the fascist government has lost its legitimacy, and can fall surprisingly quickly. Of course, depending upon the forms of organization, this can in turn lead either to a new form of democracy (if you're very lucky) or can result in the installation of demagogues. It's often an opportunity for border regions in the country (if they are far enough away from the center of power) to split off and become independent. But what it very seldom does is return to the status quo.
This too shall pass.
Kurt
I enjoyed reading this comment of yours (altho brevity is the soul of wit). ;-)
I especially agree with your take on the rise of (OECD?) fascism and the consequences of eroding the middle class. For a long time I have firmly believed that we are becoming (or have in fact become, since around the turn of the century) fascist countries now. Was it Mussolini who said that an alternative term for fascism, is corporate statism. He said so with approval, and he should have known what he was talking about.
I wonder if you agree with me, that over the next decade political stability will be found in China (possibly Russia?), as they build up their middle class in order to generate domestic consumption, while the OECD countries balkanise or descend to the same conditions that characterise our 'emerging markets' now.
I do not see any turnaround for the OECD. When you say, 'This too shall pass', I wonder if I can take it that political stability does occur, in different places at different times, even as it passes from our own borders. This doesn't make me despair for why despair at inevitability - but I am still outraged. That so many have known, and do know, better, and are powerless to prevent this happening. (Where ignorance is bliss 'tis folly to be wise.)
The rise of the black markets is now, as it was for the Soviets, the best hope of survival for individual citizens IMO. For this reason I will do all in my own personal power to contribute to such a rise. But as a society the Soviets were much better prepared for their collapse than we are.
An exceptional piece of work, KC. Small businessmen are America’s "canary in the coal mine” in this festering recession.
These Cyrus McCormicks and Eli Whitneys--with their crafts, professional skills, innovations, and management skills--engaged in free market competition working because of property rights that assured them and the public the widest variety of goods at the lowest prices. That’s what built America. These small businessmen grew in a climate of capitalism fertile with the elements of freedom, patent rights, ideas, capital, labor, and management. And law that prevented legal plunder. They were and are the backbone of capitalism. Capitalism is what Henry Ford engaged to build Ford. Statism is what Car Czar Steven Rattner engaged to massively restructure GM into Obama Motors. (Rattner subsequently resigned under a cloud of influence peddling to be replaced by Car Czar Ron Bloom, former steelworkers official.)
Destroy America’s middle-class, her property-owning class--the butcher, the baker, the candlestick maker-- that employs 50% and upward of American workers, and you destroy America’s prosperity and the American Dream..
Who is this petit bourgeois, this canny retired Glasgow grocer Dickson McCunn so loved by John Buchan, this Thomas Alva Edison...?
Says Princess Saskia, fleeing Bolshevik Russia in Buchan’s novel, Hunting Tower (1922):
"You will not find him in Russia. He is what they call the middle-class, which we who were foolish used to laugh at. But he is the stuff which above all others makes a great people. He will endure when aristocracies crack and proletariats crumble. In our own land we have never known him, but till we create him our land will not be a nation."
He is "the petit bourgeois, the epicier--of the class that does three-quarters of the world’s work and keeps the machine going and the working man in a job--which the world ridicules.”—
He was the answer to America’s success, to Russia’s ills; destroy him and you destroy America.
Do I believe in oligarchs? Of course, I do. IMO, they are the Morgans, the Warburgs, the Goldmans, the Meyers, the Blavatniks, the Rothschilds, the Rockefellers… working to obtain the monetary wealth of the world to enslave mankind to subservience.
As to your point about corporate statism, I agree. America has a wide range of corporate executives and directors who have risen to the top of the corporate world because they are willing to be quiet about the lies and willing to play by the rules of the State. A good example is Steve Jobs. He is not an oligarch electing presidents and deciding foreign policy. But he is not going to criticize the financial core of this country; he is going to work with it. He knows where his niche is and he uses the system; he knows when to talk and when to shut up. The most successful corporate statists are the people who know how to work with the oligarchs, the investment bankers.
Just read New Deal or Raw Deal, highly recommended if you haven't read it.
I agree that was a pretty impressive move by the PPT to get it just over 10,000 like that.
Looks like the real surprise will be if we collapse sometime Monday. I re-bought a few puts at eod just in case.
The channel is clearly still down.
Yeah, put a on a vertical spy spread myself just to have some exposure, nothing huge, but wouldn't surprise me if we start the week without the typical Mutual Fund Monday i.e. MASSIVE SELLOFF.
I am always amused that traders fail to read the words of Jesse Livermore - "the best advertising is the action on the tape" and "you would be surprised at how much stock you can distribute in a falling market."
Indeed, if an occasional ramp at the right point on the charts can cause dip buyers to come in, then you can slow down the descent and distribute that much more stock over a longer period of time.
I particularly enjoy these "dip buyers" who issue successive "buy" calls without emphatic "sells" in between.
To "buy" a dip one must have cash - cash which arose out of a sale!!
Being a guru is so much easier than actually managing money!
the magic numbers :
Dow > 10.000!!
Unemployement < 10%!!
.......agree. 10 is the magic number. Make it work until it doesn't work no mo.
If most of it was short covering, what does that JPM post Tyler made say?
A little from column A, a little from column B...
So, what kind of rocket fuel does the PPT have at its disposal? I suppose all those excess reserves at the big guys are on tap for trading. Can they keep it on the books if it is in equities? I reckon. Look, ma! The fifteen trillion we lost in RE, savings and retirement is sloshing around at B of A! I wonder if it is enough?
The PPT can operate without any trace; the Fed runs a secret operation. And yes, by executive order, it can buy equities. We don’t have to prove when they do. It’s the Napoleonic legal code; guilty as charged until you prove you are innocent. If they won’t tell, we can make the accusation based on the evidence. Today was one of the most blatant and politically connected examples that we've ever had. It came on a day of a critical jobs report, a day when total job losses in the recession were revealed to be almost a million higher than previously reported, a day with high tensions over worldwide economic uncertainty, and at the beginning of Obama's tour to promote a jobs bill. Everything was coming together and they just couldn't afford to have the newspapers say, Dow Below 10,000.
Robert Rubin himself acknowledged during a high level financial meeting that “the Fed” intervenes to stabilize stock markets via phone calls to major stock investors with instructions on short-term injections. Hank Paulson fessed, in different terms, to the same.
The stock market—as well as the financial media--is rigged. The intention of The President’s Working Group on Financial Markets (PPT) is to falsify the picture of supply and demand. That’s why they (the PPT)—the treasury secretary, the Fed chair, the SEC chair and the CFTC chair—wanted and were granted permission by President Ronald Reagan to buy equities--for "enhancing the integrity, efficiency, orderliness, and competitiveness of financial markets and maintaining investor confidence.”
In addition, the Federal Reserve has been pouring liquidity into the system through its many programs, especially since March '09, and much of that liquidity has gone into equities and commodities to prop up markets.
The way Marc Faber put it this week:
During the recent quarter, for instance, the preponderance of Goldman Sachs’ revenues came from trading in bonds, currencies and commodities. But these profits were no evidence of Mr Market doing God’s work, greasing the wheels of commerce and trade by facilitating productive financial transactions.
In fact, they represented the fruits of hyperactive gambling in the Fed’s monetary casino – a place where the inside players obtain their chips at no cost from the Fed-controlled money markets, and are warned well in advance, by obscure wording changes in the Fed’s policy statements, about any pending shift in the gambling odds.
http://ftalphaville.ft.com/blog/2010/02/03/139991/faber-lashes-out-again...
An excellent summary JR...well said. golf clap!
Yeah I think risk goes up infinitely when you don't have to worry about getting more chips for free.
Thanks Nick,
Good to see a fellow Brit on this site.
I would suggest that we wait to check support at the 100 and 200 MA, before any drastic action.
ps. what happened today at ICAP?
I note your boss sold his shares mid-January. Is ICAP fucked?
B
Wasn't 1050 the 200 MA? Or was it like the 50 MA? I seemed to have a notion that under 1050 meant bear market again...
I'm so confused now.
So which is it? JPM, or short covering? Pick a story and stick to it.
Is it both? WTF???
in my view, it was JPM acting as agent for the PPT which lead to the short covering.
lots of spy moved a/h as well, down fractionally. rinse, repeat as needed.
Exactly. I liken this to fantasy baseball on position scarcity. If, for instance, you want to get a really good closer for your team and you know once the other closers are being drafted then you can fill out other positions on your roster because you are creating a fear due to herd mentality.
JPM just kicked it off and the herd followed.
Tyler,
You should post the part of Cramer's episode tonight when he recommended Ultra Petroleum and got the ticker wrong twice. Once at the beginning and once at the end. Ahhhh true comedy early for a weekend.
"Following this view we believe we have completed today the first bearish impulse of the sell-off started in January and which would last if we are right well into the spring."
Maybe an up week next week before the next leg down.
Anybody who trade here may be can help. How can one put a stop loss order for a short?. I tried that few times but it seems I can't do it.
Obama goes to Copenhagen for a global warming summit: weather? a blizzard.
Obama returns to Washington from the global warming summit: weather? a blizzard.
Tonight? Perhaps the heaviest snow in the history of Washington, D.C.
Barack, God is speaking, are you listening?
+1. Dude is fail, failed and failure on his picks. Love to know whether he likes Colts or Saints. Pick the over/under for a kicker. I'll be in Vegas, baby.
He's ((favoring)) the Saints.
http://www.washingtonpost.com/wp-dyn/content/article/2010/02/03/AR201002...
So go take out a $50,000 loan and put in on the Colts.
LOL good stuff man.
It's nothing more than a cyclical cooling trend in the middle of a secular warming trend. God's long summer. I'm sure of it
Funny stuff. But it's the government manipulating the weather with HAARP. It's the PPT team for weather/temperature.
Climate change you can believe in.
This site is funny... You will use every blip in the data to justify your points of view... These blizzards are the result of an el nino system that was predicted over the summer... nothing to due with the lack of global warming. Just like this downturn in the market will be nothing but a blip... heck, even March 2009 will turn out to be a blip.
The thing that really cracked me up was when ZH did CNBC viewership comparisons between November 2009 and 2008, and suggested that their viewership was falling off a cliff... hmm, why would people have tuned into CNBC in Nov 2008 versus 2009 in much greater numbers? That's when I realized how careful I have to be reading anything on this site...
And the absurdity of the comments about the PPT. Surely there are better ways to make money than shorting against such a powerful force, if you believe it is an active and frequent market participant.
One of the consequences of global warming is the desalination of the North Atlantic gyre, which in turn decreases the ambient heat coming into Western Europe and by extension much of the US and Canadian Atlantic coastline. This in turn means that circumpolar high pressure systems are able to push further south (ironically at the same time as the polar regions are heating up), creating temperatures that are well below average for this area, while global warming adds moisture making for blizzards. This may also be coming off of a solar cycle that's entering into a long term (72 year) cooling phase. This will likely mask the effects of global warming in the northern hemisphere for some time to come, though payback will be painful by 2090 or so when we flip back into the hot phase.
This is one of the reasons I'm not as immediately concerned with global warming as a factor, though it is still a concern. By 2050, the big concern in much of North America and Europe will be being able to heat your house enough, in the presence of dwindling oil and natural gas supplies, as extreme cold becomes the norm. A good presentation on this is a piece the BBC did recently called The Big Chill:
http://www.youtube.com/watch?v=rFZctmJoCX4
Oh, to put things into perspective, here in Victoria BC, we had maybe ten days in the last four months below 0 C as daytime highs, and no appreciable snow fall all winter. We had trees beginning to bud in the last days of January, and the Canadian Winter Olympics in Vancouver are in real trouble because we're having to create artificial snow.
that would be 'do', not 'due'. Perhaps you picked that up from one of those global warming reports by one of them smart fellers what lied about they data. If you and your brethren are so concerned about gw, then cut you're breathing by 50%. Better yet, go all the way.
Wow, pretty pithy, Quacker. You get a reasoned assessment of Climate Change, you come back with Do/Due. Gee, you must be pretty high up in a think tank somewhere with thoughts as deep as that.
Harden the fuck up, Wacky.
no deep thoughts needed to debunk bunk.
IK didn't the same thing happen when he visited China too? IIRC it was like a blizzard of epic proportions. I remember seeing a train that had been covered in snow and the local Chinese like fireman were trying to dig the thing out.
The markets can remain irrational longer than you can remain solvent. That applies to the Fed too.
No self respecting short stayed that way. I started covering down 70 and finished by down 130. Complete reversal trade and rode it up. I still expect a ppt futures prop Monday, like every Monday for the last two months now. Easy.. Crooked .. Dont call it a market. Itroofs rigged casino. Only Goldman and jpm know each spin ahead of time. The FBI and sec don't care to know...
Nikki.
Thanks for the observation ... Last down Monday was 12/07/2009 ... before that 10/26/2009. Also some of the biggest moves of the week came on Monday ... I'll look into it and report back here
is she playing with her hair regularly?
or how else do you know a top could well be in?
sry, awefull joke
That's it I'm fed up. Put the hat on take the hat off, put the hat on intake the hat off. Son of a bitch I should have never bought the dam thing.
The market turned around because both the dollar, euro and XAU completed 1 to 1 "ABC" patterns.
There was a virtual panic selling euros and buying dollars mid-morning, and after that, the buying and selling became completely exhausted.
But because of the the huge volume today in SPY, UUP, FXE, etc. odds are high that this bear move is not finished yet. We will probably gun higher Monday and Tuesday, then crash down to either retest the lows again or go even lower.
Some examples from 2008:
"Hey, I thought we bottomed!!"
"Oh, no!!! SELL SELL!!"
today was the perfect day to hypnotize and then gun it in concert to cause mass short covering. my hunch is that "they" won't let it drop below Nov. lows in order to preserve the uptrend and all the "social benefits". it's just enough to keep the short interest keen...... they can't screw anyone if they alienate everyone.
Jamie doth love his fawning behemouths
If most of the late afternoon bounce was due to short-covering, then watch Canadian stocks closely the next while.
The TSX closed up 94 points in the last 45 minutes on Friday.
Why is anyone surprised that shorts covered on Friday in a sensible manner for some and then in a herd like fashion for the rest? I mean a few of them have made some nice coin in the last few days so why not lock in some profits if day trading is your gig? Instead it gets labeled a conspiracy, the shorts are going to be crushed now by the mythical PPT (who, if they exist, would hardly be buying at these levels).
See Occam's razor folks. Collins English Dictionary defines it as follows: n. a maxim attributed to William of Ockham, stating that in explaining something assumptions must not be needlessly multiplied. In other words the simplest explanation is more often than not the correct one.
I am not wedded to any particular investment mantra other than eclecticism and a reliance on HG's common sense which, by the way is generating a vibe similar to last April. Something has changed and risk is now shifting to the long side. Obviously investment would be easy and everyone rich if such transitions were telegraphed to the masses with great fanfare and certainty.
The most psychologically difficult thing for most people is to pull the trigger short and add near a preceived top (or conversely throw long near a bottom) even if the market moves against you for a day or two. There is still hardly a whiff of fear in the air (unless you are short it seems). Therefore being short or getting shorter is, by my way of of assessing probabilities, fundamentals and technicals, actually the most propitious course of action right now but that's just me. Ultimately the direction Monday will be insignificant in the larger scheme of things if the journey is 1080 by Wednesday and 580 by November.