Beware the Ides of March. Arrive the Black Swan?

Will the mistrust of Banks and Government finally come home to roost?  Ponzi Schemes can continue as long as new money is continually introduced, and trust in the system remains.  Will trust finally be breached?  This is playing out to be a very interesting Monday.

I've been quite patient in finding the next intermediate top.  Nine positive trading days, larger selling volume on Friday, and, of course, Cyprus.  As for events in the rest of the world, I dont have nearly enough time to follow it's crescendo of crazy.

Unless the crooks can jam the futures back up into tomorrow's open, and restore all confidence and trust, I would expect the next stop on the S&P to be the 1440 range.

Even my patience has had to learn patience.

Short term shows divergence on the stochastics, the 200 ridiculously ahead of itself, and similar volume selling that we saw in December.

 



 

The final theft draws near.

End of World? No. End of a false Economy? Maybe

A Lock Limit down just ocurred in the Futures Market.  The S&P Futures locked out at 50 points down, from 1441 to 1391.  A 31 point plunged ocurred in just under 1 minute.  While futures markets are thinly traded, a 3.5% move is quite significant.  And a 2% drop in value in 1 minute in an index will always be significant in my book.

People are pointing to the Lame Duck Congress.  I am still quite shy about these markets.  They are heavily manipulated, I no longer trust a thing from the Government, and this could be nothing more than a fat cat design of the Federal Reserve and Goldman Sachs.  Never let fear and panic be wasted!!  Strike Fear into the hearts of the people, and steal the last of the money with QE5 and Fiscal Cliff golden hangliding.

For you DOW people.  The lock limit was about 300 points.


Deficit spending and monetization of our debt may finally be over..................but who knows if they have a couple more tricks up their sleeves.  One can only fake math and exponents for a short while.


Attached below is my one year S&P chart.  The green line denotes a 1 year, very significant resistance line, that will most likely hold.  It is the last hope of the Bears.

This second chart is a daily chart.  The significance of this chart is the 200 day moving average near 1390.  About where the lock limit down bounced off to tonight.  It is my belief that this 200 day moving average was fatally wounded in mid November.  My guess is that we do not even bounce at 1390 when we get in its vicinity.  I was originally expecting a runaway gap under it.....but even I question an opening tomorrow more than 50 points down.

The three year pattern shows an ABC correction, with the terminal wedge. 1250, and 1160 are the next pivot points.

The three year candlestick charts shows the persistant support of the 200 day moving average, as well as the negative Moving Average Convergence/Divergence roll over.

VIX looks primed to go parabolic.  It also looks like both Gold and the USD could go negative, which would really pummel all wealth across the board.  Sounds deflationary to me.


And dont forget the most important chart of all.  The 100 year chart.  We are still tip toeing on the top of the silliness line.  IT IS IMPOSSIBLE TO SPEND $8.70 Federal Dollars to create $1 of GDP.  The recent 12 years at the top of this graphic easily depicts the free credit explosion.

S&P under the 200 day moving average *warning*

The S&P closed last week under the 200 day moving average.  We are currently at a location with high probability of ripping to the downside, with Tuesday and Thursday most likely being the high volume days. 

The S&P must close the week above its 200 day moving average to keep a Bullish scenario alive.  Things looking rather precarious at this location.

QE1, QE2, QE3, QEnfinity. Is the Fed out of Ammo?

As I have posted before, I am looking for the Great de-leveraging of our generation.  Since March of 2009, the Federal Reserve has gone to inflationary extremes three+ times that I never even considered probable.  I had always been hopeful that the Fedeal Reserve wouldnt have such disregard for the US Dollar, and wouldnt export inflation so freely to the rest of the world, but I was very wrong, and very naive.

The only question remaining now is whether the Federal Reserve is out of Ammo.  Does the Bernank have another inflationary trick up his sleeve?  If so, there are a couple currencies in the Middle East that will most likely not survive another round of our inflation exportation, with the Iranian Rial probably being the first currency inflated into oblivion.  If that happens, things could get very ugly, very quickly.  I believe the Bernank may finally be cornered.

With these things considered, as well as new tax laws going into effect in January, and the "fiscal cliff" approaching at the end of this year, I see a substantial turn in the markets before the end of the 2012.

I was expecting a rise into the end of the year, but today we pinned a very important trendline to the downside.  Any selling South of here breaches an upward trendline existing since October, 2011.  We are definitely on the razor's edge, and the uncertainty in the global market is like nothing I have ever seen before.

Euro Plunge?

Sell in May and walk away?  Enough to get me interested again, anyways.  I can't believe the Christmas rally lasted 5 months.  If Greece is pulled out of the Euro or Egypt gets a little crazier, I expect to see some very damaging currency action in the Euro.  I would expect the USD to strengthen, and I would expect to see deflation start running it's course.  It could finally start getting nasty.  It should be a very interesting week.

.......unless Helicopter Ben throws out QE3.  Anything is possible with the Fed lately.

Rangebound for a month, resolution soon

We have been rangebound for nearly a month.  I expect a resolution by the end of this week/early next week.  Whether Santa Clause shows up or not will most likely be determined by the Euro.  If the Euro/USD cross breaks 1.31, I expect SWHTF.
Breaches of 1292 to the upside and 1226 to the downside are easy lines in the sand.  Both have merit, but I would expect the Santa Clause rally to not start before an intermediate pullback........and the surprise may be that he doesn't show up this year.

As far as the full meltdown scenario goes, I will stay silent until we get back under 1100.  Current European news and spreading civil unrest may back my claims.  Unemployment near 18% and food stamp use near 20% would not normally point to "green shoots."  Unfortunately for me, the time factor and the Federal Reserve/IMF tricks are quite difficult to predict. 

Ruck is getting cute again. Another top must be close.

The Santa Clause rally is showing up two months early this year.  I wasn't expecting to be at these levels until the end of November.  Earnings are expected to hit record levels this quarter.  Oddly they will be doing so during a global credit meltdown.

My current target on the upside is the 200 day moving average, or around 1270.  This coincides with around 12,000 on the DOW.  I have plotted how this move might look over the next two months, minus global events truncating it early.

I believe 1220 today was an excellent short location.  I believe 1240 will be a great short in about 2 weeks, and 1270 mid November would be a gift.  This move should definitely be the last hoo-rah.