The Most Important Chart To Consider For The Weekend (Or Tom Lee's Nightmare)

Tyler Durden's picture


Sometimes, it just pays to keep it simple stupid. At some point, the dismal economic reality of our post-credit-creation-miracle boom world will reassert itself in asset prices. The catalyst may not be obvious (like a close-election reminding a nation of sheep just how divided we are as a people and implicitly as a political class - and what that means for our future fiscal probity); but it is coming. 'Cycles' cycle; the Fed has fired its bazooka; and OMT omnipotence is in doubt;and the only way we get 'moar money' from our central planners is if their hand is forced by a reversion to reality...



US economic data may be surprising to the upside (of economist's expectations - weighted by what is clearly now the most bullshit pre-election datasets we have seen) but as we have said before - there is no decoupling, it is lagging and leading behavior (combined with the normal pre-election upward bias of hopium in sentiment). The chart above makes it clear that while some have seen positive moves by US-specific macro data surprises, the rest of the core international economies are doing decidedly badly - and US equities remain ignorant (for now).


(h/t @Not_Jim_Cramer)

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Fri, 11/09/2012 - 19:31 | 2966533 Dr. Engali
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Buckle up kids it going to be a wild ride.

Fri, 11/09/2012 - 19:34 | 2966541 vast-dom
vast-dom's picture

let's pull up some Japan circa 1990's charts and do a little cross-sample extrapolating, why don't we?

Fri, 11/09/2012 - 20:30 | 2966694 Kitler
Kitler's picture

MOAR = Mother of All Reflations

Fri, 11/09/2012 - 23:48 | 2967091 Seer
Seer's picture


Sat, 11/10/2012 - 00:19 | 2967128 zerozam
zerozam's picture

Hindenburg omen anyone?

Sat, 11/10/2012 - 02:20 | 2967300 paddy0761
paddy0761's picture

Last Hindenburg Omen was in late July I think, so has time expired.





Sat, 11/10/2012 - 08:20 | 2967443 Spirit Of Truth
Spirit Of Truth's picture

Was there a Hindernburg Omen before the '87 crash?  Cause the stock market is currently tracing out a parallel pattern to just before the '29 and '87 crashes:

Fri, 11/09/2012 - 20:58 | 2966759 NobleSavage
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I wonder when we will ever reach 1 Quadrillion in debt.  

People 50 years from now will be singing : I want to be a trillionaire so f..n bad...

Fri, 11/09/2012 - 23:33 | 2967063 masterinchancery
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In Zimbabwe, it was "trillionaire will work for food."

Fri, 11/09/2012 - 19:38 | 2966555 Thecomingcollapse
Thecomingcollapse's picture

Black Monday, I'm ready all ready!

Fri, 11/09/2012 - 19:47 | 2966582 vast-dom
vast-dom's picture

Starting in Straight of Hormuz. The Iranians wage a bit of assymetric war this weekend and Monday goes to hell faster than a rabid algo turning on itself.

Fri, 11/09/2012 - 19:49 | 2966593 NotApplicable
NotApplicable's picture

"Iranians?" Is that what they're calling the latest CIA op?

Fri, 11/09/2012 - 20:24 | 2966682 flacon
flacon's picture

AAPL will soon be worth less than a pice of cardboard:


From E-Bay UK:



A piece of cardboard (shaped a bit like a popular phone) – USED



Item condition: Used Time left: 7d 22h (17 Nov, 2012 22:57:11 GMT) Current bid: £70,100.00    60 bids ]   Place bid   Enter £70,200.00 or more


Fri, 11/09/2012 - 21:38 | 2966854 Dr. Sandi
Dr. Sandi's picture

All I can say after going over there is, better be sure you know who has access to your credit card. Some poor unsuspecting fool is going to be really pissed off next weekend when the charges show up on his card account.

Fri, 11/09/2012 - 20:45 | 2966736 Spirit Of Truth
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Syria is the more likely source of trouble in the immediate term, but Iran is also a possibility.  The new moon is on Nov. 13 and the stock market appears to be crashing into it like occurred in late-October of 1929:

(The new moon is obviously of strategic importance if Israel was planning to strike Iran post-U.S. election.)

Fri, 11/09/2012 - 21:31 | 2966838 Urban Redneck
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Banks that actually participate in the system make better catalysts, but in a pinch they might suffice.

Fri, 11/09/2012 - 20:28 | 2966692 blunderdog
blunderdog's picture

Assymetric war?  Sounds hot.  Isn't that a Greek tactic, though?

Sat, 11/10/2012 - 12:26 | 2967668 vast-dom
vast-dom's picture

THE GREEK WAY! no spellcheck?¿?

Fri, 11/09/2012 - 20:11 | 2966642 franzpick
franzpick's picture

'Black Monday' I've been ready for: it's the upcoming black week that has me worried...

Fri, 11/09/2012 - 20:33 | 2966706 max2205
max2205's picture

4 years of over massaged over cooked sandbagged rigged underestimated over estimated revised recalculated economic reports coming home to roost....what could happen?

Fri, 11/09/2012 - 20:51 | 2966752 NobleSavage
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I think Black Friday will come first this moth before a Black Monday event.  

The now"confident" US consumer will flex his muscle and wiggle his belly at least more time. 


Fri, 11/09/2012 - 21:40 | 2966858 Dr. Sandi
Dr. Sandi's picture

'Black Weekend' has a nice ring to it. And it should be popular with voters. People love a 4 Day Weekend. Especially if it's a federal holiday.

Fri, 11/09/2012 - 21:41 | 2966864 Dr. Sandi
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Wait. Since it's after Turkey Thursday, it would be a 5 Day Weekend. Unheard of!

No WONDER people voted for more Obama.

Sat, 11/10/2012 - 08:43 | 2967468 youngman
youngman's picture

It will start on a Sunday night in Asia...where the HFT´s can really control the market on little volume......then when the USA opens on will already be crashing and we will not be able to adapt fast enough...its amazing how many countries on the verge of this and that...I think the next big APP of this decade will be starvation.....

Sat, 11/10/2012 - 16:55 | 2968387 Dr. Sandi
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Which to eat first, the eyepad or the gold. Hmmmm.....

Sun, 11/11/2012 - 01:14 | 2969241 DanDaley
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youngman, you sound like Billy Mitchell back in 1929 predicting the Japanese attack on Pearl Harbor...he was right, too.

Sat, 11/10/2012 - 08:15 | 2967441 slaughterer
slaughterer's picture

Black is beauitiful (ask Obama), but it is not coming to the markets any time soon.  

Fri, 11/09/2012 - 19:32 | 2966535 NeedleDickTheBu...
NeedleDickTheBugFucker's picture

Reality, what a concept.

Fri, 11/09/2012 - 19:38 | 2966553 Yen Cross
Yen Cross's picture

 The Economic news is anything but promising. The news out of Japan was horrible last week. The news out of China was "transitional window dressing" at best. The news out of Germany, France and Spain was crappy.

  The news out of "South East Asia" was marginal, [Korea, Singapore]. The news out of "South America", crappy.

 The only reason endless printing is flying below the radar, is because "lack of demand" is horrible...

   That chart divergence says it all. +1 Tyler

Fri, 11/09/2012 - 20:12 | 2966644 ArkansasAngie
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And then ... GB said well ... gee ... we don't believe that printing money is the correct thing last week.  So ... maybe we buy some pounds?

Fri, 11/09/2012 - 20:48 | 2966681 Yen Cross
Yen Cross's picture

 Well done Angie. That Sterling trade, does look interesting.  I was getting fired up over the cross... [gbp/jpy]

 Not so sure now. I like that more than eur/jpy and aud/jpy though. 67% of Australian bonds are foreign owned.

  Guess we'll see next week.

 Mervyn King, knows GW...

Fri, 11/09/2012 - 19:39 | 2966557 Cdad
Cdad's picture you would have thought that the lousy earnings we have seen so far this qtr would have removed "surprise" from any sell side guy's lexicon at this time.  

I am anything but surprised about the state of things just now.  That the blue line is so far above the red line in that chart is an indication of just how broken the market is....which is also NOT surprising.

In any event...nice coverage this week ZH.  Suddenly...."surprisingly" for some, I guess...the markets are fun again!  

Best wishes to all the folks who bought that 1380 S&P line this afternoon, and now have to sit and stew on it for the weekend.  We all have our crosses to bear. 

Fri, 11/09/2012 - 19:51 | 2966596 HelluvaEngineer
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Cdad, you've been mostly quiet for a while now.  Nothing makes sense.  Stay safe and stay prepared.

Fri, 11/09/2012 - 20:03 | 2966625 Cdad
Cdad's picture

Busy lately.  A lot of short term trading in the past few weeks.  

As for prepared...I am nicely so.  

And as for "nothing making sense" Helluva...I cannot remember the last time ANYTHING in this country or this market made any sense, at all.  I believe the ZH approved phrase is "baffle them with bullshit."  However, and since we have clearly all been here before...baffling folks is much, much harder to pull off.

You take care, brother.  It's about to get quite messy around here.

Fri, 11/09/2012 - 20:09 | 2966641 The Shootist
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It's about to get quite messy around here.

^Bring it, I'm game.

Sat, 11/10/2012 - 15:20 | 2968124 Crabshacker
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%96.5 of the sheeple are game..just like a buck in a clear cut!

Fri, 11/09/2012 - 22:07 | 2966913 stormsailor
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this last week the market has been like before march 2009,  where 10 years of chart reading and resistance lines, flags and channels have been working like back in the real market.

Fri, 11/09/2012 - 22:00 | 2966900 stormsailor
stormsailor's picture

i've learned better at the end of a couple of 25 point gap ups in the /es.  but i'm hardheaded and stayed short from 1387.   here's hoping it doesn't end in tears.  

Sat, 11/10/2012 - 09:45 | 2967513 RSloane
RSloane's picture

"Best wishes to all the folks who bought that 1380 S&P line this afternoon, and now have to sit and stew on it for the weekend. We all have our crosses to bear. "

They're handing out tissues at Daneric's.

+1 Cdad

Fri, 11/09/2012 - 19:47 | 2966581 fonzannoon
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where are they now Brian Wesbury

Fri, 11/09/2012 - 19:53 | 2966603 Itch
Itch's picture

Wouldn’t it be just plain fucked up if the S&P was the right indicator in this case? That would be some funny shit...but as they say, shit happens. In our lifetime, we have been fatally stung by over optimism and hopium, but i dare say there will be a point where we will be equally stung by pessimism. Scrap that, it already happened.

Fri, 11/09/2012 - 19:58 | 2966611 Hannibal
Hannibal's picture

Keep on stacking those 10oz silver bars.

Fri, 11/09/2012 - 20:07 | 2966635 eddiebe
eddiebe's picture

Charts don't apply anymore.

Fri, 11/09/2012 - 20:18 | 2966660 Yen Cross
Yen Cross's picture

 You might want to Re-think, that remark.

If I asked you a question related to fuel prices in your neighborhood, and supplied a cost chart for you, would it be relevant?

  Charts are only as reliable as their makers...  Some of the best charts are just referrence points from fellow traders. ;-)

Fri, 11/09/2012 - 20:31 | 2966700 Itch
Itch's picture

Yen, your grammatical gibberish and crazy train of thought never ceases to amaze me. 

Fri, 11/09/2012 - 20:38 | 2966720 Yen Cross
Yen Cross's picture

 Who? What Itch?  I think you have the wrong guy? 

  If you elaborate, I'll think about entertaining your comment...

Fri, 11/09/2012 - 20:36 | 2966710 buzzsaw99
buzzsaw99's picture

only the blow hole determines reality not charts. ;)

Fri, 11/09/2012 - 20:40 | 2966725 Yen Cross
Yen Cross's picture

 Thank You buzz. ;-)

Fri, 11/09/2012 - 21:02 | 2966778 eddiebe
eddiebe's picture

Yen, as always there are exceptions to the rule. No doubt you are right in what you point out. My remark was short for charts showing results in market manipulation, which when pondered and used to extrapolate meaning lead to mistakes in investment. They also keep employed a whole host of chartists and talking heads.

Fri, 11/09/2012 - 21:12 | 2966798 Yen Cross
Yen Cross's picture

 It's Friday evening, and I appologize if you were offended in any way. We at Z/H have pretty thick skins.

  I think that you are 100% correct on your "quality of (dis)- information" thoughts. Welcome to the club...

It only gets better...

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