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Is "The Ultimate Indicator Of Easy Money Access" Rolling Over, And Absent More QE, Is This It For The Market?
Two weeks ago courtesy of Sean Corrigan, we presented what many consider the "ultimate shorthand indicator of easy money and speculative access" - the stock price of auction house Sotheby's. Well, the easy money may be about to end, and with it the latest bout of irrational market exuberance. As the chart shows, Sotheby's has timed the three previous armageddon with uncanny precision, with the red vertical lines marking the market tops almost perfectly. These occur when the i) RSI hits overbought, a condition that has been realized now; ii) when the stock price has a monthly closing below its 12 month Moving Average, also realized and iii) when the MACD crosses below its Signal line - this is about to occur any minute. We expect the 4th red vertical line to mark the end of this particular period of uber easy money any minute, and absent another monetary stimulus, to begin the at first slow, then very fast collapse to another market secular low.
h/t David
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Sweet! Lets get this show started!
Slightly OT, but well worth the read:
http://www.americanthinker.com/blog/2011/08/we_the_stupid.html
August 1, 2011
We The Stupid
Ann Barnhardt
I stand here in abject stupefaction. The so-called "right" or "Tea Party" in this republic is being so thoroughly rolled and defeated that I am struggling to come up with an adequate violent submission metaphor that does not involve prison rape . . . and they honesty think that they're "winning." Really? You call this winning?
http://www.americanthinker.com/blog/2011/08/we_the_stupid.html
Wheres that one 'T Partee' guy who was here posting nonstop about how great they are? I dont think its so much the T Partee being 'rolled', its that they were just the same old BS as the others from the get-go! Fooled a lot of people for sure.
The debt has been razed.
thank you tyler, i trust zero hedge with my financial health.
The path of the righteous man is beset on all sides by the iniquities of the selfish and the tyranny of evil men. Blessed is he who, in the name of charity and good will, shepherds the weak through the valley of darkness, for he is truly his brother's keeper and the finder of lost children. And I will strike down upon thee with great vengeance and furious anger those who would attempt to poison and destroy My brothers. And you will know My name is the Lord when I lay My vengeance upon thee.
I'm tryin', Ringo. I'm tryin' real hard to be the shepherd.
The only thing that succeeded was bringing attention to the Debt topic. They used the only leverage point they had against a political establishment (both R and D) that flat-out does not want the party to stop. There is little question IMO that if the fiscal conservatives were not elected in November this would never have even been addressed.
A lot of the 'crowing' is a political set-up. This AM I heard a D railing about how awful this was for Americans - and how this was going to dramatically impact the economy, blah, blah.
Knowing that there are no cuts of any substance now shows how willing the politicos are willing to deceive the public.
But there's another possible motive: Since the public at-large seems to be very unaware of the details, it would not be a stretch to see the ailing economy blamed on the Tea Party - due to the HUGE BUDGET CUTS. Upcoming election cycle bullshit, but certainly not out of the range of possibility.
Once the rating agencies clamp down on our credit rating, it provides fodder for the Tea Party to point out that the cuts were simply insufficient which can be used to put the spenders back on the defense.
Certainly the issue is not over - not by a long shot.
First off, let me say that I completely agree that this debt deal is a fraud that just kicks the can down the road, with none of the real reform that anyone with common sense can see is necessary. That said, Ann Barnhardt is a raving lunatic who lacks even a basic understanding of how our goverment works. Her whole premise that Obama is being given $2 trillion to spend at his discretion (on nefarious marxist-communist schemes?!?!?!) is laughably insane. The dysfunction is in Congress, which has pretty much all the authority to define the budget and spend the money. If you don't understand that basic fact, you really shouldn't be calling anyone stupid.
Perfect timing to announce QE3?
Hi Missiondweller.
Excellent post. I expect QE3 chatter within weeks.
Uncanny, the similarities of last year to this. Remember the Hindenberg Omen indicator of Aug 2010, followed by QE2 within weeks. Now this indicator.
put your shots on
Sure, I will drink to that. I love shots.
Time to shake the 401k tree for QE3?
very nice...
Oh no, not another short sqeeze.
For all of us arts and crafts/eddy and mcgee types, we are sitting dead on the neck line at 1268ish if it holds on a closing line chart basis. Any ugliness at tomorrow's open triggers an avalanche. The question becomes will this head and shoulders fail like the previous one (via more QE) or does this one follow through. I'm personally thinking h&s semi-fail down at 1190/1180ish when the Berstank cuts the fat lady off with a public service announcement... or so I'm thinking.
The harbinger of bad times ahead was when those 12 bottles of CHATEAU LAFITE 1996 barely sold above the 12,000 GBP estimate
http://www.sothebys.com/en/catalogues/ecatalogue.html/2011/finest-and-ra...
mmmm...chat-o-la-feet
I think you've spotted the next asset category for QEx. This is how they will prevent the depression. And how apropos for The Bernank to go out as a Wine-O.
QE3 or massive McJobs bill is coming.
Here's proof:
- Gold taking off and XAU is finally confirming the move
- 8 consecutive down days in the Dow, 8 consecutive days with -1100 TICK
- TRIN approaching 3.0, 2 days in a row
- SPY sitting right on the 200-day
No CONfidence RobloT?
beg much, 'tard?
vz down: check
hd down: check
mo trading within its .00001% band: check
your top pick std for 2011 down 30% from high: check
from $1342 gold street gentleman jim sinclair sends warm regards.
btw: has your boss at "my bank / our bank" figured out you are still processing the same 1099's every day to stretch the contract?
Robo seeing red as more 'My deepest condolences' emails show up from Gentleman Jim.
his inbox is chock full of sympathy emails. but i'm sure he has the gigs to handle them all given his state of the art 4 monitor work station with a lumbar supported swivel chair and three secretaries in support of his internet surfing duties, zh posting and most important, the processing of that same exact set of 1099's he must process each day.
wonder if he believes his own lies?
McJobs bill. That's what pisses me off. The banksters get trillions handed to them on a silver platter, they fuckedup and fixed nothing, now they are gonna give trillions to j6p, but they will have to work some shit job for it. Hang them all NOW!
Yes. lets get this show on the road.
this chart works indeed. And, also note what happens when low tick readings coorelate with low RSI readings.
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID3225058&cmd=show[s208587727]&disp=P
Ill be going long the strongest sectors with a trendline break on the 60 min.
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID3225058&cmd=show[s162497802]&disp=P
after that seems like more weakness ahead until QE3. And, with the UST issueing $660B next quarter (to play catch up) logic would dictate,,,,,
QE Lite is ongoing. The Fed still has its hand up the markets ass. We are testing support, so the big money can buy. When the Senate rams the debt ceiling higher, watch the markets move up. And Jackson Hole is underway, and Bernanke has all the indicators he needs to continue QE, by ushering in QE 3 from the light.
We will bounce off of support this week, and move to the middle of the recent range, to Dow 12,400, and then Bernanke will say, "The recovery needs to stay on track..." and presto, QE 3.
Economists all over the world agree, easy money should continue. They set the agenda, not anyone else. That is why they are Dr.s, because they are the smartest damn people in the universe. Question them at your own peril.
You really like your boss ?
Economics is a psuedo science. It is based on groundless rhetoric. It assumes the cosumer is rational, all resources are abundant, and that labor is free.
When credit is easy, expect people to function in irrationality.
Apple, Nike, etc, all use slave labor. Where would they be with out it? The system would not function.
Oil is finite and its production has peaked. Gold and silver and platinum are finite and silver is the only one that has not peaked its production.
People can not live on the amount they are being paid, due to inflation and other problems.
Yet the fact that people will not live in slave conditions forever is ignored. The slaves will rise up.
The question is when. Will they rise up before the production of finite resources peak? If not, people will fight their last battle in an inferno. If they rise up now, then there is a chance for us to reconfiure the world justly.
"Economics is a psuedo science. It is based on groundless rhetoric. It assumes the cosumer is rational, all resources are abundant, and that lobor is free."
Mr. Lennon Hendrix, I have no idea where you get your "knowledge" (or opinions) or if it is superior/inferior to mine...but I have studied economics, sir, and your assertion above is way, waaayyyyy off, in my humble opinion.
Economics assumes rational actors with very good (if not perfect) information, doesn't it? Have you ever met anyone like that?
And how does it deal with the not-insignificant concept of 'money'?
Rather than waste a lot of time trying to wing it, try these:
http://en.wikipedia.org/wiki/Austrian_school
For the wiki version, see above
http://mises.org/daily/3561/Understanding-Austrian-Economics
Or above for the mises.org version.
I hope that helps.
Economics is a psuedo science
not von mises' and menger's
also, you forced me to misspell "pseudo" to quote you accurately...thanks
12 bottles of CHATEAU LAFITE 1996, and I can't locate my corkscrew........
Just use a rock to break the top off and use a straw to drink what's left of the wine.
Did did put the bottles in the fridge already right?
Shorting faberge eggs, bitchez!
Going long Nothern California sensimilla bitchez!
can you loan me some on margin?
.
Since none of the debt proposals would have worked, it doesn't matter that they passed the largest debt increase in American history. More time to prepare for the inevitable, as our financial destruction is a sure thing now. Gold bitchez!
Short Dutch Tulips, bitchez!
great call! timing's a bit off though
Nice. :)
It would be cool if the Dow laid a 600-pt egg within 48 hours of BHO's signing of the 2011 declaration of debt dependence.
Or a 6,000-pt egg by November 6, 2012.
Is -265.87 close enough?
Soft patch, bitches.
Time to go all in on your 401k.
:killmenow:
Treasury would like nothing more, fatten up the 401K's a bit more before they seize them.
Like my buddy Rothchild says: "Buy when there's blood in the streets."
He's my dog you know. I taught him to say buy me kibbles in bits, but it comes out like Buy when there's blood in the streets. Good Dog!
Could be the beginning of the end but I am still not shorting this market. Saved me a lot of pain so far. Will just stick with gold, PMs, silver and some confetti. For me the course is true and straight with the obvious bumps. What a cluster F___k yesterday was. What has happened to this great nation? Very sad indeed.
And, for me all, Zero Hedge is the first place to be for the facts. Support this site if you can. I have said it a dozen times, Zero Hedge is not always right, but is always truthful. How many MSM sites do you find which can say that. My latest donation, gladly given today.
Thank you Zero Hedge
but it's so fun to short
Zerohedge is uncannily prescient & almost always right !
I'd gladly pay you Tuesday for a Warhol today.
With the dismal performance of QE2, starting at 2.3 % gr GDP 4th qtr 2010, .4 !st qtr, and probably -.5 for 2nd qtr (they lied when published 1.3%)
How could they even think of suggesting QE3?
What am I missing??
if they announced QE3, commodities would take off so hard that it would immediately kill any prospect of "stimulus effect".
Shooting themselves in the foot so far hasnt worked, but its the only idea theyve got so next up theyll shoot themselves in the head!
With the dismal performance of QE2, starting at 2.3 % gr GDP 4th qtr 2010, .4 !st qtr, and probably -.5 for 2nd qtr (they lied when published 1.3%)
How could they even think of suggesting QE3?
What am I missing??
if they announced QE3, commodities would take off so hard that it would immediately kill any prospect of "stimulus effect".
Qe3 will be coming soon and Obummer will want a stimulus package to run on before the election.
Who is that going to fool? Yet ANOTHER 'stimulus' thats proven to not work at all? LOL it will be immediately front-ran and devoured, no one with any money is stupid enough to believe in this crap anymore.
Look at all the fools who fell into he trap of believing we needed to raise the debt ceiling. They are the same idiots who will buy into stimulus 2, tarp 2, and qe3.
This is perhaps the MOST important chart you've posted in the last year.
History rhymes. End of story.
Anyone who "buys on the dips" (equities) now is a total moron.
Wait ~6 months and prepare to make fortune.
S&P500 long term chart shows a series of broadening patterns - aka megaphone wedges.
The three broadening formations reveal an unstable market where buyers and sellers battle for control...
http://stockmarket618.wordpress.com
for all those who said POMO only did something with some bank reserves :(
for those who said banks bought treasuries from people who then put that money into riskier assets :)
note to self, no matter how bearish I am, if QE3 starts to seem likely, cover all shorts and get long gold and IWM
QE is like training wheels, if your kid can't ride without them you have to put them back on. Although in our case it's much akin to having a teenager that lacks the basic skills to ride. At the risk of beingnon PC, perhaps America has become a "special needs" case?
Why is it that. when commenting on some political writing I am biased toward evincing perspective harmonious with a love of life and of one's fellow man, yet here, after reading this post, I feel no compunction to forward this eyebrow raising perspective to empirist extraordinaire Lazlo Birinyi? Maybe it's fear he might call to thank me for this game changing piece of data, dreading the effect when I pick up the phone and hear his voice, At that moment I might rather wish I had stuck my head in a microwave. So, the best I can do to remain true to my political philosophy (while still looking out for life #1) is hope he regularly googles his name and gets this message before it's too late: Lazlo Birinyi, you really should read this, you crazy empiricist whose data claims stocks are a buy despite an insolvent banking system.
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