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Guest Post: Major Sell Signal Triggered

Tyler Durden's picture





 

Submitted by Lance Roberts of Street Talk Live,

For some time now we have been warning about the danger to portfolios given the deteriorating fundamental, economic and technical backdrop in the markets.  Our warnings, for the most part, have been ignored as individuals continue to chase stocks in hopes that "this time will be different", and somehow, stocks will continue to ramp higher even though all three support legs are weakening.  Currently, it is the imminent arrival of the next round of Quantitative Easing (QE) that keeps "hope" elevated but further Central Bank intervention is unlikely in the near term leaving the markets at risk of a further correction.

My job is to analyze the trend of the data, both economic, fundamental and technical, to build a frame work of possibilities and probabilities about what might happen soon.  Like any good poker player before making a "bet," which requires putting my capital at risk of loss, I want to make sure that the odds are in my favor of winning.  If I am highly confident of success - I bet a lot.  If not - I do not.  The same philosophy goes into managing money.  Wall Street tells you to be invested all the time because that is how they make money.  However, the reality is that investing is very akin to playing poker - you are making bets today based on the possibilities of some future outcome. 

The reason for this framework is that I have been negative on the markets since early April.  The weight of evidence has clearly been negative.  While the mainstream media continues to look for glimmers of "hope" - hope is not an effective investment strategy.  However, when the flow of data changes and price action becomes more constructive - my outlook will also. (Read "Thoughts On Long Term Investing")

For new readers, welcome to the site, here is a brief compendium of previous articles which have been guiding our readers through the current market correction process that began in early April:

 

Major Sell Signal Is In

This bit of history leads us to our latest, and most important, sell signal to date.  With the economy continuing to weaken, corporate earnings, showing severe signs of strain and the Eurocrisis emerging once again - the risk at the moment is clearly to the downside.  The continued deterioration, in both the fundamental and technical frameworks, has significantly increased the risk of further equity market declines. 

The decline in the markets on July 24th pushed the two main moving averages that we follow into negative territory initiating a major SELL signal for the markets.  These major sell signals should not be ignored.  The first chart plots our two moving averages relative to the S&P 500 over the last 12 years.  During this time frame there has only been 7 "sell" and 6 "buy" signals.  As with all investment strategies and disciplines there is always the possibility of getting a false signal.  The same is true for this particular indicator.  Since 1930, there have been a total of 51 major "sell" signals of which 9 gave a false reading translating into a 17.6% failure rate.  As I said, no indicator is perfect, but as an investment manager I am willing to make investment decisions based on an indicator that has an 82% success rate. 

More importantly, as shown in the chart, this strategy helped us avoid the bulk of the last two recessionary market debacles.  The problem is that while it is easy to assume that the current correction could be shallow, like previous two summers as the Federal Reserve stepped in to prop up asset prices, there is always a chance that it could be a much bigger correction.  Following the signals previously would have limited downside risk while keeping you primarily invested in for the majority of bullish trends.

 

The next chart shows the similarities of the 2011 and 2012 markets.  In both cases rallies in June, post a May decline, led to sloppy sideways trading in July.  The major "Sell" signal occurred on August 5th of 2011 as the markets began a steep sell off.  While there is no guarantee that the market is about to plunge towards the 1200-1250 level this August - the striking similarities of market action certainly does suggest a more cautionary stance be taken.

Sell Into The Bounce

Technical signals must be put into "context" based on current market conditions. In order to strip out the "noise" in our analysis we use weekly instead of daily price data.  This smoothing of the daily data allows for better clarity of the trends in the market.   However, due to this smoothing process by the time a signal is given the markets are generally overbought, or oversold, on a daily basis and are generally close for a reflexive bounce.  That bounce should be sold into.

The problem for most investors is that when the market bounces in order to correct the short term oversold condition they assume that the "sell signal" was incorrect.  More than 80% of the time, as our data shows, the market will bounce and then decline to lower levels.  Therefore, the rules are simple:

  • In negative trending markets - sell rallies.
  • In positive trending markets - buy dips.

The technical and fundamental setup is currently a negatively trending market.  It is very likely that, in the current environment, we will retest the May lows, if not ultimately set new lows, in August.  Those lows will likely coincide with further weakness in the economy which should be the perfect setup for the Fed to launch a third round of Quantitative Easing.  Should that occur that will provide the best opportunity to take the cash we are holding in reserve and increase equity exposure at lower price levels. 

The caveat to all of this is if the Fed acts early with QE 3 at the end of this month.  I don't think this is likely but it is a possibility.  In that event the boost to asset prices will reverse the current signal and we will need to add equity exposure back into portfolios.  However, until then, with the major "sell" signal in place it is more important to remain cautious, and conserve investment capital, until a better risk/reward opportunity presents itself.

 


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Wed, 07/25/2012 - 17:26 | Link to Comment veyron
veyron's picture

BTFD, STFR

Wed, 07/25/2012 - 17:40 | Link to Comment SheepRevolution
SheepRevolution's picture

Here is Harry Read, defending an audit of the Fed:

 

http://www.youtube.com/watch?v=oXOsZ7Ad7dM

 

Spread it!

Wed, 07/25/2012 - 18:03 | Link to Comment Dr. Richard Head
Dr. Richard Head's picture

But Harry was all pissed because savers were being supported. Great fucking find. Sharing it now.

Wed, 07/25/2012 - 18:18 | Link to Comment Precious
Precious's picture

None of these "signals" mean squat.  The only thing that matters if whether big brother is going to manipulate the market again.

Wed, 07/25/2012 - 18:27 | Link to Comment derek_vineyard
derek_vineyard's picture

am i just really out of it or did he give no formula for how he calculated the sell signal?

Wed, 07/25/2012 - 18:34 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

To equity bears all you have to do is yell "King Dollar" loudly and deflation will happen....

Any minute now....

Any minute....

Wed, 07/25/2012 - 21:11 | Link to Comment Muppet of the U...
Muppet of the Universe's picture

BTFD GODDAMNIT. 

Disclosure: Short Big Dow from 880.

Thu, 07/26/2012 - 05:48 | Link to Comment jeff montanye
jeff montanye's picture

when does btfd evolve into stfb (sell the bounce)?

Wed, 07/25/2012 - 20:15 | Link to Comment bdfromkg
bdfromkg's picture

He didn't give a formula, but with a little "trial and error" it's clear that the short-term MA (moving average) shown is the 50-day MA, while the long-term MA appears to be about a 160-day MA. Both of these can be overlaid on almost any graph (including the S&P 500) on many sites such as yahoo (finance.yahoo.com). The signal is simply that these two averages have just crossed, as they did in 2011, and also in 2008, before much damage was done. This is a simple and common technique, although the use of a 160-day MA is a little nonstandard, but it seems to work pretty well. As to whether technical analysis like this "works", make of it what you will. My own opinion is that TA is not much help in deciding what to do, but it helps in deciding just when to do it (timing). There are lots of indications (IMHO) that the market is going to have a significant turndown soon, and this "signal" may be a good indicator that it's time to sell (or short).

Wed, 07/25/2012 - 18:06 | Link to Comment emersonreturn
emersonreturn's picture

audit the f***ing fed, sure...then sue the fed!  

Wed, 07/25/2012 - 18:06 | Link to Comment AldousHuxley
AldousHuxley's picture

Harry Reid representing mob casinos?

 

VEgas mobsters just want to find out the secret of the Fed in running gambling scams, so that they can implement it themselves.

 

Mobsters KNOW banksters have better casino operation strategies. FED is the ultimate HOUSE.

Wed, 07/25/2012 - 18:25 | Link to Comment Missiondweller
Missiondweller's picture

He was actually for it before he was against it.

 

Channeling John Kerry?

Wed, 07/25/2012 - 19:49 | Link to Comment fuu
fuu's picture

In 1995 Sen. Harry Reid said:

 

"Mr. President, I would like to extend my congratulations to the Senator from North Dakota, of course for authoring this amendment which I am a sponsor. But more importantly for speaking out about the Federal Reserve, for years, I have sponsored legislation that would call for an audit of the Federal Reserve System. I offer that amendment every year, every year the legislation gets nowhere. I think it would be interesting to know about the Federal Reserve. I think we should audit the Federal Reserve. It's taxpayers money that's being used there but we don't do that.

Senator Dorgan has spoke out on the secrecy of the Federal Reserve System. He's spoken out on the Federal Reserve more than anyone that I know in either body. But even though there is no entity in the world that controls our lives more than the Federal Reserve System, his speeches go unnoticed I'm sorry to say.

People just don't care, it seems, about the Federal Reserve. Maybe because it's a subject that isn't very interesting. You know it's not pornography. It's not, um, murder. It's not, uh, an issue that deals with the wild west, water grazing , uh, doesn't deal with issues that we talk about here a lot. But we don't talk enough about the Federal Reserve and the impact it has in our lives. So I acknowledge the work that my friend from North Dakota has done on this issue, and I am sorry that his very lucid statements have received very little attention.

I was thinking, as the Senator from North Dakota was outlining the secrecy of the Federal Reserve system, that maybe what we should do is, the Central Intelligence Agency has received a lot of criticism lately of not doing a real good job. One reason maybe is that their not secret enough in some of the things they do, um, maybe we should combine them with Federal Reserve Board. What the Federal Reserve Board does, nobody knows what they're doing. CIA it seems everyone has some idea what they are doing. So maybe we could combine the two, it might not be a bad idea.

Mr. President, the Federal Reserve has raised interest rates 6 times since February of 1994. If someone likes this legislation, generally speaking, that is we're going to try stop unfunded mandates then they should love this amendment. If the principle of underfunded mandates being stopped sounds good to Senators, then they should jump with joy and run over here and co-sponsor this legislation. Because this really overshadows all other unfunded mandates, because these go on all the time. Not only do they affect government because of the money that governments borrow but it also affects the private sector significantly. There isn't a person that's in, that's listening to this debate or could listen to the debate that higher interest rates doesn't impact them. Doesn't matter if they are homeless or they're making a multimillion dollar transaction on Wall Street as we speak, higher interest rates affects everyone in this country.

What we are saying is that the Federal Reserve Board would provide a report to Congress and to the President about anticipated costs of changes in interest rates on the Public and Private sectors. All we're aware of each time the Fed raises interest rates is we pay more. We should have a little more foundation as to what we really do pay.

This amendment requires the Fed to prepare a report, this report will detail the costs imposed by interest rate changes within 30 days after the Fed decision to change such rates. The report will include an analysis of the aggregate costs that interest rate changes would impose on Federal, State, and Local governments. Will provide a cost analysis of interest rate changes on Private sector borrowing. This Mr. President will allow us to see the increases in borrowing costs for consumers, small businesses, home owners. and commercial lenders.

I am glad that there has been a roll call vote called on this matter. I think it's important if people are in favor of doing away with unfunded mandates that they support the largest unfunded mandate we have in America today."

Wed, 07/25/2012 - 17:42 | Link to Comment UP Forester
UP Forester's picture

Buy a safe place away from cities, food, guns and PMs with what's left, and STFU.

Wed, 07/25/2012 - 19:03 | Link to Comment j8h9
j8h9's picture

I can't but I'll find you in the UP. Keep a chair waiting.

Wed, 07/25/2012 - 17:26 | Link to Comment fonzannoon
fonzannoon's picture

"The spx is on my radar"....

Wed, 07/25/2012 - 17:48 | Link to Comment HD
HD's picture

"It's hitting new highs"

I roll my eyes at that commercial every time it's on.

Wed, 07/25/2012 - 17:50 | Link to Comment MrTouchdown
MrTouchdown's picture

"Inflation is transitory"

Wed, 07/25/2012 - 18:03 | Link to Comment sessinpo
sessinpo's picture

Most things are and relative too

Thu, 07/26/2012 - 05:56 | Link to Comment jeff montanye
jeff montanye's picture

on a long enough timeline ....

Wed, 07/25/2012 - 17:27 | Link to Comment j8h9
j8h9's picture

buy low, sell high, that's my strategy. Good material for a book.

Wed, 07/25/2012 - 17:29 | Link to Comment tawse57
tawse57's picture

Akamai up 20 percent after hours, Western Digital up 16 percent. This market will not pause let alone die

Wed, 07/25/2012 - 17:32 | Link to Comment fonzannoon
fonzannoon's picture

This site is all about the boomers and their dividend payers and how they are cashing out. There must be some other site for the 20somethings and their crackhead tech stocks.

Wed, 07/25/2012 - 17:47 | Link to Comment tawse57
tawse57's picture

PMSL

Wed, 07/25/2012 - 18:19 | Link to Comment fonzannoon
fonzannoon's picture

i have no idea what pmsl means but if it is unpleasant then my apologies. i was just fkin around. 

Wed, 07/25/2012 - 18:31 | Link to Comment kito
kito's picture

that was a testament to your humor.....google it....and stop apologizing....it ruins the effect of your post....this is fight club...thin skinned ones need not apply...........

Wed, 07/25/2012 - 18:33 | Link to Comment fonzannoon
fonzannoon's picture

I am old.

Wed, 07/25/2012 - 19:40 | Link to Comment monkeyboy
monkeyboy's picture

And your tits are too big fat man.

Wed, 07/25/2012 - 18:00 | Link to Comment Treeplanter
Treeplanter's picture

We're all in this together, Jack. 

Wed, 07/25/2012 - 18:10 | Link to Comment sessinpo
sessinpo's picture

Actually I think there is a wide variety of people here. Libertarians, conservatives and socialist that don't realize they are closet commies. Many different age groups and financial backgrounds. I don't find ZH to be MSM yet, which is a good thing IMO. Otherwise I'd be able to walk up to any boomer aged person on the street and say, "What did you think of that thread titled ________?" Not going to happen. Most boomers, like most of the world buy what is sold on TV as real news. I'm so glad I gave up TV for the most part. Watch less then 1 hour a week.

Anyway, it is interesting to see others jumping on board to sell signals and such. Makes me a little uncomfortable to be followed.

Wed, 07/25/2012 - 23:55 | Link to Comment RockyRacoon
RockyRacoon's picture

I wear my ZH t-shirt now and then without a comment nor nod from others.  I'm 63 years old so I guess they think it's some kind of old rock bank logo.   I like being smug.

Wed, 07/25/2012 - 23:57 | Link to Comment WillyGroper
WillyGroper's picture

>>>>>>> I don't find ZH to be MSM yet, which is a good thing IMO. Otherwise I'd be able to walk up to any boomer aged person on the street and say, "What did you think of that thread titled ________?"Most boomers, like most of the world buy what is sold on TV as real news.

 

Where'd u get this mindset sport?

Wed, 07/25/2012 - 18:33 | Link to Comment vintageyz
vintageyz's picture

Try MSN.  It has all sorts of great stuff like Steven's Puppy Love and Other Stars Get Goofy.

Wed, 07/25/2012 - 17:30 | Link to Comment ihedgemyhedges
ihedgemyhedges's picture

Yeah, but what does RoboTrader think?????????

Wed, 07/25/2012 - 17:31 | Link to Comment bnbdnb
bnbdnb's picture

Looking at futures, todays small "rally" basically went nowhere.

Wed, 07/25/2012 - 17:33 | Link to Comment ArkansasAngie
ArkansasAngie's picture

Benny ... Benny ... Benny.

Go ahead and print.

Only ... since it won't work this time ... especially since you are a gutless $*^%%( and will print little ... we'll be rid of you and your bankster buddies sooner.

Wed, 07/25/2012 - 18:05 | Link to Comment Treeplanter
Treeplanter's picture

Yeah, Ben, I want a good price on my last gold miner, cash for buying back in after the Big crash.  Sell the first spike, guys, may be the last.

Wed, 07/25/2012 - 17:40 | Link to Comment MrSteve
MrSteve's picture

So we sell unless the Fed eases yet again: that is just stupid!

of course the Fed is backstopping Yurp and the yur-a-0 as are all central banks in a now obvious, highly coordinated program.

Junk IPO stocks and junk TrUsury bonds are just signs of the junk times of junk currencies. The time to get real is now, with real assets, not promises some from virtual flimflam artiste. Using historic charts to call hysterical market manipulating currency programs is like using a tide clock to tell when to wipe your ass. Pardon my French!

Wed, 07/25/2012 - 17:38 | Link to Comment MrSteve
MrSteve's picture

double post

Wed, 07/25/2012 - 17:57 | Link to Comment MrTouchdown
MrTouchdown's picture

On the bright side - all the crap they pull to bouy the markets is subject the the law of marginal returns. They peaked a while ago and now each additional measure has less and less effect. The market will rear its head soon, and when it does, no amount of policy put in place by the guys we gave wedgies to in High School will save their precious little scheme.

Wed, 07/25/2012 - 18:12 | Link to Comment sessinpo
sessinpo's picture

That law of marginal returns applies to QE also which is why BB is trying to suggest this is a fiscal, not monetary problem.

Wed, 07/25/2012 - 17:38 | Link to Comment mayhem_korner
mayhem_korner's picture

 

 

Sadly, I have nothing left in this rigged market to sell...

Wed, 07/25/2012 - 17:50 | Link to Comment Muppet Pimp
Muppet Pimp's picture

That is no reason to stop selling, for best results borrow some more & sell it also...

Wed, 07/25/2012 - 17:38 | Link to Comment Gringo Viejo
Gringo Viejo's picture

Doesn't matter. The Fed will rig interest rates & the stock market until they can't. That day approaches.

 Forget capital appreciation, preservation of capital is paramount. Got PMs?

Wed, 07/25/2012 - 17:40 | Link to Comment rubearish10
rubearish10's picture

STFU! Major moves are never iminent by prediction!

Wed, 07/25/2012 - 17:46 | Link to Comment HD
HD's picture

I don't know about that. I predict major moves imminent for anyone eating at Taco Bell...

Wed, 07/25/2012 - 18:08 | Link to Comment Treeplanter
Treeplanter's picture

Except for when they are.

Wed, 07/25/2012 - 17:40 | Link to Comment Meesohaawnee
Meesohaawnee's picture

heres the problem.. Your talking data , earnings, technicals. Ben has made them irrelevant.

another problem. Your talking investors. There gone,,Well except Robo.

1200 to 1250 ?? this should be trading 1100 or below but hey when you algo ramp it up so high. 1200 looks deep to the sheep

Wed, 07/25/2012 - 17:40 | Link to Comment Bennie Noakes
Bennie Noakes's picture

Did I just hear a bell ringing?

Wed, 07/25/2012 - 17:42 | Link to Comment goldfreak
goldfreak's picture

anybody remember the Hindenburg Omen or the death cross?

Wed, 07/25/2012 - 17:55 | Link to Comment one_fell_swoop
one_fell_swoop's picture

Combined with the Krapling's Negative Divergence, this is all very bad news indeed.  Make sure you buy physical, not ETFs or receipts which are backed by nothing more than fiat promises and have likely already been sold out from under you as the Fed transfers all its gold holdings to China.  Make sure you test your physical thoroughly, a bite test isn't enough, you need to cut into the bullion to make sure it hasn't been plugged with tungsten.  For storage, make sure it's in a well-protected vault in one of the few countries that still respect private property laws (unlike Uncle Sam, thief extraordinaire!) like Belize or Ecuador.  Keep it remote, buried, and marked with a cryptographically secure solar homing beacon so that you can find it again, but not those who roam the world looking for people's stashes.  I'll address domestic food security and ammunition needs in a separate post.

Wed, 07/25/2012 - 17:44 | Link to Comment q99x2
q99x2's picture

'Individual investors'

Really.

Wed, 07/25/2012 - 17:45 | Link to Comment toady
toady's picture

BUY BUY BUY!

err...

SELL SELL SELL!

wait..

RUN RUN RUN!

Wed, 07/25/2012 - 17:53 | Link to Comment pragmatic hobo
pragmatic hobo's picture

technical/fundamental analysis only work in free market.

Thu, 07/26/2012 - 10:37 | Link to Comment sessinpo
sessinpo's picture

I've done quite well. We have a gap to fill on the NYSE to 7750, but other then that. I wouldn't be long. It could get real ugly.

 

Added this comment the next day. Damn I'm good sometimes (but not always)

NYSE is up 133 points to 7741 at 10:30 this morning from a low of 7691. Cheers.

Wed, 07/25/2012 - 17:55 | Link to Comment hedgeisforpussies
hedgeisforpussies's picture

The caveat to all of this is if the Fed acts early with QE 3 at the end of this month.  I don't think this is likely but it is a possibility.  In that event the boost to asset prices will reverse the current signal and we will need to add equity exposure back into portfolios. 

He said it. The Fed is moving next week so whats the point of selling now when you know the Fed is easing. And if it doesnt ease then you can sell. Why take the risk of being shortsqueezed. just wait for aug 1st and if no qe then sell. 

Wed, 07/25/2012 - 17:55 | Link to Comment RobotTrader
RobotTrader's picture

The market is wound up tighter than the wet skin on a bongo drum, and equity investors are nervous as a long-tailed cat in a room full of rocking chairs.

 

Any "surprise" announcement to "save" Europe is going to launch one of the biggest equity rallies we have ever seen, and the leading sectors will be the Emerging Markets, which have been basing out for over 3 years now:

http://bigcharts.marketwatch.com/kaavio.Webhost/charts/big.chart?nosetti...

Yep, it's one of those classic "head and shoulders tops" which Shampoo McHugh crows about, with a projected target of "negative' like poor McHugh predicted for the S & P 500 back in 2010.

Those "Shampoo" formations almost always morph into a giant "Boner Rally" from hell.

 

Wed, 07/25/2012 - 18:09 | Link to Comment Dr. Richard Head
Dr. Richard Head's picture

Funny. Shampoo has always been amazing for my Boners from Hell. Just remember, I'm usually taking a Bath.

Wed, 07/25/2012 - 19:37 | Link to Comment infinity8
infinity8's picture

I'll see your bongo drum and raise you the kitchen sink that the bull in the china shop will be sweatin' like a fat man in a foot race by the end of summer.

Wed, 07/25/2012 - 20:41 | Link to Comment Nadaclue
Nadaclue's picture

I gave you an upvote. You've shown just how absurd the "Save Europe this time" is, sans the previous 19 previous announcements. This is the only one you'll get so enjoy it.

 

I guess that's what makes a market, although you're a troll.

Wed, 07/25/2012 - 17:58 | Link to Comment GlomarHabu
GlomarHabu's picture

Once again ..the data, the metrics....

Within the context of getting a 17+% false sell sign over the timeframe outlined one MUST absolutely MUST consider just how valid the data points have been over the past.... forever.

We are, thanks to the Internet, gaining tremendous insight into just how rigged ALL the data coming from WS and the guv'ment has been. Can't touch an audit on the FED, no,no.

I empathize with money managers attempts at making something reasonable out of the goulash that are "the facts" but I can no longer buy into any analysis by anyone, be they an honest person or a dishonest person, for each uses the "lies,damn lies, and stats" to conjure their predictive ending., and from what we are seeing things have been luridly rigged for a long time.

Wed, 07/25/2012 - 17:59 | Link to Comment zenith191
zenith191's picture

What I don't get about all these moving average cross buy/sell signals is that you don't get the signal until the market has already gone down or gone up. That is, it takes the big move to average out the price to show the cross. Those circles should really be at the bottom of the move. Try it, get a chart and line up the price with the day the MAs crossed. You would be losing money. Otherwise, if it did work, any idiot could follow this and never lose a cent.

 

Wed, 07/25/2012 - 18:05 | Link to Comment TideFighter
TideFighter's picture

Exactly, charts, signals, and unicorns = same thing. 

It's like counting cards at the Black Jack table. When the count is high, you 

increase your bet, allthewhile the casino snickers at you. Winning is not to play.

Wed, 07/25/2012 - 18:01 | Link to Comment XtraBullish
XtraBullish's picture

Oh Great - now Graham gets company in the bear camp - it would all make sense if it was a stable currency regime but you have to stay short cash with the USD just about to crash. I would never be long U.S. dollars/ short hard assets for anything more than a "trade" after such a massive rally in the currency of the world's largest debtor nation. 

Wed, 07/25/2012 - 18:07 | Link to Comment shuckster
shuckster's picture

Currency crash impacts wealth impacts future earnings. A currency crash is not bullish for stocks

Wed, 07/25/2012 - 18:03 | Link to Comment shuckster
shuckster's picture

QE 3 won't save this market - especially considering the oncoming weather drought and food shortages it will cause - and QE would need to be at least $2 trillion to truly fix the debt problems spanning accross all Western markets, and that's not going to happen.... expect little/no action. Things are about to get a lot worse...

Wed, 07/25/2012 - 18:22 | Link to Comment kito
kito's picture

there will be NO QE3 ANYTIME SOON.....attn all hopium addicts!!!!...there is methadone!!!..try it!!!!...................imagine.....pre elections.....full frontal lsap is implemented.........oil shoots to 120, gold hits 2000, food through the roof...........no way, no how, not happening.....if the algos are really the only ones feeding the almighty dow, as tyler has taught us, then rumors will suffice.....rumor...ramp....rumor....ramp......rumor....ramp......

Wed, 07/25/2012 - 20:29 | Link to Comment Nadaclue
Nadaclue's picture

Babe, Bullets, Beans, Bunkers, Beer and Band-aids. Needed within the next year. Sit in yer bunker, sippin, slippin and sliding while the die off occurs. I'm ready, are you? (as for bullion, if you ain't got it by now or oh so soon, it won't matter. It'll be an unknown few years before you will be able to use it.)

Bring it, bitchez

Wed, 07/25/2012 - 22:07 | Link to Comment LooseLee
LooseLee's picture

Please explain to me how an additional $2T in QE debt will "fix" the debt problems. This I gotta hear...

Wed, 07/25/2012 - 18:11 | Link to Comment Meesohaawnee
Meesohaawnee's picture

yea.. goulash is right .. I cant get that image of that smarmy little prick TG being asked about breaking up the banks today while getting out of the car. Oh no no comment .. little bitch! but oh we sure can talke about fuckin QE !!

Wed, 07/25/2012 - 18:12 | Link to Comment max2205
max2205's picture

Let's hope Lance isn't Charles.

Aside, Ben has everything upside down sideways and diagonal now so who knows if technicians have hibernated till Ben passes away

Wed, 07/25/2012 - 18:14 | Link to Comment kito
kito's picture

The caveat to all of this is if the Fed acts early with QE 3 at the end of this month....

 

i love chartists and analysts with their prognostications.....it seems like this will happen....unless that happens....then this wont happen....


Wed, 07/25/2012 - 18:14 | Link to Comment marz929
marz929's picture

WHERE IS JON CORZINE?

Wed, 07/25/2012 - 22:46 | Link to Comment GOLDTEETHSILVER...
GOLDTEETHSILVERFILLINGS's picture

On the lam...

Wed, 07/25/2012 - 18:20 | Link to Comment Meesohaawnee
Meesohaawnee's picture

“It is difficult to get a man to understand something, when his salary depends upon his not understanding it!” - Upton Sinclair

taken from the burning platform. Thats what i think of charters and technicians and people that think its a "free" market. Lets put Econ professors in that group to

Wed, 07/25/2012 - 18:20 | Link to Comment Shizzmoney
Shizzmoney's picture

Our warnings, for the most part, have been ignored as individuals continue to chase stocks in hopes that "this time will be different", and somehow, stocks will continue to ramp higher even though all three support legs are weakening. 

The sad part is, this trickles down to the public (not capital....but a warm glass of "Hope" piss).

MA Lottery Revenues came out today.  They are up $30 million to $981 million this fiscal year.  The MA State Treasurer says that "aggressive marketing" is the reason. 

I'd tend to disagree; I'd say, considering that since the majority of us make shit and our wages are stagnating and our savings are standing pat, it's probably a sign that the public is spending so much on lotteries because we are all seeking our "one-time" to escape the corporate serfdom we are all in and secretly hate, even if some of us (i.e. the Fox News crowd) defend it.

But hey, spending $100 on those scratchies.........maybe "this time will be different."  Let's see the MA Lottery Commission use that for a slogan on their next campaign.

 

Wed, 07/25/2012 - 20:36 | Link to Comment RunningMan
RunningMan's picture

How is our present different than the movie Hunger Games?

Wed, 07/25/2012 - 18:20 | Link to Comment Hype Alert
Hype Alert's picture

You didn't chart that.  Someone else charted that.

Wed, 07/25/2012 - 18:25 | Link to Comment BeetleBailey
BeetleBailey's picture

If the fucking Fed "acts" with QE3...there will be so much blowback it will reach the halls of Congress, shoot up Harry Reid's crippled old ass - bazoom out and slap ChuckFuck Schmuer silly, and be seen by everyone as an Obama stroke job.

 

....and like the inept interventions of the likes of the BOJ and SNB - won't fucking work.

Wed, 07/25/2012 - 18:31 | Link to Comment Meesohaawnee
Meesohaawnee's picture

and if the fed acts Romney is a fuckin idiot if hes not all over that. Then again. Im sure the millions hell bag will make not getting in the white house a little more palatable. . QE3 will be the obummer re-election trust fund.. funded by the middle class. Buy hey they have their I -worlds. No problems here.

Wed, 07/25/2012 - 18:43 | Link to Comment fonzannoon
fonzannoon's picture

This sounds bad but call a spade a spade. Most Romney people are the the ones with stocks and real assets. They stand to benefit from QE. Most Obama people probably have little if any money in stocks and if they own real assets they do not own much. So why would Obama want QE here if it does nothing for his base? As a matter of fact no QE probably drops food/oil prices temporarily. The only caveat here is if the deflation hits so hard a few big banks start going under and then it's a wipe out across the board.

 

Wed, 07/25/2012 - 18:50 | Link to Comment fonzannoon
fonzannoon's picture

Because Fonz at the end of the day Obama is owned by the banks just like the rest of em.

There I reminded myself.

Wed, 07/25/2012 - 20:30 | Link to Comment Savyindallas
Savyindallas's picture

Because despite the rhetoric -Obama is owned by the banksters and has served them faithfully from day 1. Anyone who posts on this blog should know that   --- that being said, Obama is a puppet -has no real power. They love Romney too - they will have no reservations about throwing Obama under the bus.He's irrelevant.  Another 4 years and he would totally blow his cover by making it obvious he is but a Bankster/AIPAC stooge. Goodbye Barry  Sotero.

Wed, 07/25/2012 - 18:54 | Link to Comment Hannibal
Hannibal's picture

Jesse'sCafeAmercain said it nicely:

"Far be it from me to tell anyone what to do. But I will say that I have stopped trading all options, both in stocks and commodities.

The rigging that characterizes the markets overall, through the manipulation of price and the mispricing of risk, is most pronounced in the paper derivatives such as options and artificial constructs like some of the ETFs which are designed to lose almost without regard to what the market does.

Gold and silver could go either way here. I do not have enough visibility into where the suckers are placing their bets, and where the wiseguys are placing theirs, at least for the short term.

I do believe that one of these days a major player is going to pop these markets, and rip the faces off some of the funds and specs who are leaning nakedly on the short side in a particularly painful and protracted rally from hell. I just do not know if we are there yet. The more I look at the structure of the Comex and their position and delivery policies the more it looks like a paper Ponzi scheme that could be tough to beat on its own turf.

Despite some of their identifiable predilictions, the Banks and big machers of the Street are very open minded about screwing anybody and everybody. They have no abiding loyalties or allegiances except to themselves."

Thu, 07/26/2012 - 01:03 | Link to Comment ATG
ATG's picture

Kinda like the pop the markets and rip faces (heads) off part...; 

Thu, 07/26/2012 - 02:33 | Link to Comment avidtango
avidtango's picture

But this is old hat. I've been hearing that stocks and options were manipulated by the Big Boys for 45 yrs yet the stocks that stay strong are those who innovate, change and make money The problem is not specific instruments but the effects of monetary manipulation mainly by the Fed. Their becoming buyer of first and last resort for T bills has changed everything and they can no longer control the situation,

Wed, 07/25/2012 - 18:57 | Link to Comment stant
stant's picture

and now a third hindenburg in a row, qe threeeeeeeeeeeeeeeeeeee

Thu, 07/26/2012 - 01:24 | Link to Comment ATG
ATG's picture

Since 1985, the HO has had an accuracy rate of 25% within the next 40 days:

http://en.wikipedia.org/wiki/Hindenburg_Omen

Wed, 07/25/2012 - 18:57 | Link to Comment dcb
dcb's picture

yup late fall, snd and p should be 1100 before thinking of putting money in

Wed, 07/25/2012 - 21:24 | Link to Comment spinone
spinone's picture

As long as OPEC only takes dollars for oil, no worries.

Wed, 07/25/2012 - 22:06 | Link to Comment AU5K
AU5K's picture

He is conveniently leaving out a bunch of signals i see on the graph.  Everything looks good in hindsight.  Totally worthless post.

Thu, 07/26/2012 - 00:59 | Link to Comment ATG
ATG's picture

Depends on time frame.

Forgive this ST contrarian for taking the other side of his April Sell Trade:

http://richcash8tradeblog.blogspot.com/2012/07/rich-cash-overnight-options.html

 

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