The near 90 degree bear market rally angles, which are usually set early in the day, are not an indication of a likely sustainable rally. Volatility levels are not dropping. Even if the Fed does restore the money flows, and the market moves incrementally higher do investors want to go on vacation and come back … Continue reading March 30 S&P setups into No Man’s Land: Fed’s premature Monetary Ejaculation
Here's the 3/25 update, since I posted this chart price action broke the white trend line which is actually the better of the two uptrends. The Down trend line is now calling prices lower, and when they get there, if they get there we will see where this thing is going. This may have been … Continue reading Side Bar on Trend Lines: No Man’s Land : update 3/25
In this perfect addition to foreplay, one partner lies beneath a glass coffee table while the other squats above it and unloads. Like viewing the colorful sea life from the relative safety and serenity of a glass-bottom boat, this simple maneuver is not only arousing but biologically tantalizing. The Fed attempted to unload a large sum today, most of … Continue reading The Glass Bottom Boat
After the end of monthly expiration last Friday and the massive Monday Fed kitchen sink dump, it was time to step aside for a few days. That gives me some time to ruminate on the broader situation. Politically I think Trump's instincts are probably correct. A complete lock down will do more damage than good. … Continue reading Time Out: Bears
During GFC Gold outperformed the S&P, and new money flows were strong even as the system threatened to stop (allegedly). Lets separate this selloff during that crisis into two distinct phases, before October 2008 and after. The bottom was put in six months later in March of 2009. Phase two lost 45% while phase one … Continue reading Is Gold the Canary in the deep hole where markets go to die?
Here's the setup for the rally. That white arrow trend line is significant, see chart below. See how Fed brings money to floor in the AM, (bag of donuts) and by closing time the money is gone. We're just not sure if this is another larger down leg in selling or options related. That white … Continue reading What to do? update 3/19/3/20
There are two ways of looking at the new money indicator. One is the long chart which shows that it has barely budged. The other is to look at the severity of the move, the suddenness, and the way in which it is seems to be driving prices lower, not just building more ammunition for … Continue reading Dusting off the GFC playbook:Drilling Down
The money isn't behind this move (yet). Should the traders push it over, today's REPO was nearly 2B, so there is some cash waiting to take a ride. Play it for 100 S&P points or ten on the SPY. If the trades get up there and the money does not follow, then short it back … Continue reading Short Term Buy Setup
Some thinking VIX may go to triple digits, and while it may not happen in this selloff, by the mirror image it will happen (probably) later this year. This looks like a tough year according to the mirror of the VIX and the facts seems to fulfilling the prediction. You can read the entire VIX … Continue reading First Limit Down Day
A premise here concerning new money. It is not in itself a solution for new money to simply ramp higher. That reflects more volatility and lower prices. The notion from Feds point of view is to restore the flow of new money at a slight incline higher, their inflationary bias. Now that markets are roiled … Continue reading Longer Term S&P
The short duration in the A/D money line conceals the damage. Money was bleeding out of this market at a record clip. The point of this is not, will the money return to those levels but can they sustain that flow. Right now they are running hot, at 100B or more a day. Roll that … Continue reading Bear Market Rally continues or a trading range, or more downside?
So far the rally hasn't kicked in, even with a higher open. Liquidity is still in the system waiting to go to work. With a rally scenario in place the market will close higher to form a hanging man on the daily chart. That should set up a rally tomorrow, with 328 as the optimistic … Continue reading Bear Market Counter Attack; Fed trash cans empty, Bears take it inside.. Update: THIS IS NOT A SELLOFF I REPEAT…. Update: Still room to rally here, but time running out.
In Up in Smoke Cheech and Chong drove a van made out of marijuana. It caught on fire and the cops got high trying to pull them over. I overlaid (crudely) the charts of Money Velocity, Monetary Base, and EFFR. The first thing you probably notice is that the MB and the MV seem to … Continue reading The Shit is the Fan…
https://www.youtube.com/watch?v=24VOo7-ctKU With the current market weakness (Feb21) the resulting reallocation of money into bond funds has achieved, at least temporarily, the same effects as the Fed buying those bonds. it does not however help the monetization problem (Fed takes short term paper from Treasury department to monetize spending, now must roll out to longer duration … Continue reading Waist Deep in the Big Money
for strictly educational purposes okay? 324 may be the top for a while. When the SPY didn't get overbought on a relief rally it set off all sorts of sirens. Yesterdays bland BULLISH! opening may be a foreshadowing. Today seems to have similar characteristics. Trend lines when they get over extended often act like magnets … Continue reading The Set-UP, January 8th (new bear market warning!!) Jan. 9th followup
The questions here are 1) Is Fed out of ammo here unless they go 100B, or standing REPO market order. 2) Do the buyers want lower prices, how far are they willing to go - that 320 level is critical, break that and we have some air underneath this market. 3) Is this war with … Continue reading Update January 7
We have a lot of charts here. You should see the walls of his room, "Kid with a Ruler". I asked him what is the top chart to follow this year, and he said, The VIX MIRROR. When Jerome put on the REPO robes, that signals that this market is unwinding temporally, that is time … Continue reading BRASH PREDICTIONS:
SPY broke out of its range today, not decisively, but this is all documented. The momentum players trade take it higher, and the money follows, the Jerome Powell PUT which sees to it that the market never goes down. Whatever level you can it take it to, the money will fill in behind. We are … Continue reading A new plateau with commentary
A comment over at The Daily Gold got we wondering, is there some good measure of how much effect on the Yield Curve, the Fed Rate Cuts have had?? So I did something which makes Kid with a Ruler bark like a dog and run out in the street and chase cars. I put up … Continue reading Driller(ing) Down in the Yield Curve (update 1127)
Courtesy of the Clash.. https://www.youtube.com/watch?v=BN1WwnEDWAM I have offhand plans to depart USofA. A lot, maybe all of it depends not on Donald Trump but the people who vote for him. How far are they going to take this? Then the market crash seems imminent, and it always does and part of me agrees with that … Continue reading Should I Stay or Should I Go…
From the analysts seat the thing to watch is ROC. Rate of Change is very simple, and does not rely on any interpretation of price action volume or such. It seems clear the 98 rate cut decisions threw accelerated the YC which inverted. That level, about 600 is very similar to what the ROC in … Continue reading Yield Curve non-reinversion of 94 Simplified
Update 10/08: A mirror chart assumes the left side can be reversed on the right side. There is very little standard charting work to suggest this is necessarily valid, though I have seen chartists do this, and that is where I got the idea. The rationale behind applying this, and actually seeing it work, the … Continue reading Through the VIX Looking Glass updated 10/07 with concurrent call from Under the Shark Volcano..
We could already have established a benchmark on the YC at around that historic .2 level. The hidden signal here is the ROC, or Rate of Change. Circa 94 the ROC was a modest 200. In the current situation it has already hit 600 which is still much lower than the alarm bell readings in … Continue reading Yield Curve History (Update 11/06) incl PREQUEL to “Yield Curve Intolerant”