Wednesday, November 16, 2011

16 Nov 2011

Right click and click view image to get a bigger view.  Sometimes the click doesn't work.

Beware - lots of charts saying similar things - I don't know why I keep making them all when they essentially show the same thing, but whatever.  Holy Grail Syndrome, I'll call it.

 As you probably know, I love this indicator as the timing devices I put on it.  Top:  Pretty much near historical highs.  All of which came on the back of unprecedented fiscal and monetary stimulus.  Check out the bottom RSI.  Can't really get much higher huh? Middle: TSV could get higher, but notice it is hitting its second std, something that rarely happens as you can see.
 % Stocks above 40 day moving average.  Can't get much higher, huh?

 This is percent of stocks above 200 day moving average.  Remarkable weakness when compared to the rally of the fall last year. 
 This one shows the charade of the Nasdaq composite.  Check out the Nasdaq 100 advance decline line (green) compared to the total Nasdaq composite advance decline line.  Note that the total Nasdaq throws out most other stocks which is why its price is more similar to the Nasdaq 100.  So the question is, when, not if, will the Nasdaq 100 stocks (GOOG, AAPL, PCLN, AMZN) start joining the bear market?  It always happens.

Speaking of, check out GOOG.  It messed around with my upper resistance more than I thought it would.  Check out the middle and bottom of this chart.  Will it break the lower resistance?  I am quite confident, in time, it will.  Sorry Google.  Thanks for hosting this blog.
 This would make me waiver more in that it could try to re-rally soon for its recent highs despite the already ridiculously overbought status of the McClellan Summation index.  Therefore, still overbought.
 Becoming oversold at 65%.   However, impressive building of higher lows on the hold short index.
 I think probably every blog has this up.  Note the target on the left side of the screen - 117.  SOMETIMES the price can bottom and try to regain the channel by going up and tagging it.  That COULD happen, but like I said, I don't see how it could last long considering the Summation Index.
 Medium and longer term custom oscillators.  Don't really show much other than that we have had lower peaks and lower lows.
 This is redundant of the short and medium term charts except that the bottom shows the TSV and Moneystream for the Dow.  It is clear that we are at high levels for TSV and Moneystream did not participate in the rally of last year as the Dow made new highs and this didn't.
 This is the Holy Grail Indicator I created.  It sums the percentage of stocks with a moving average over another moving average for pretty much every time frame from 1 day to 377 days.  This SHOULD help us find significant bottoms and great buying opportunities on the divergences between lows and price.
I know there are a lot of silver fans that read this blog because I was a huge bull up until it started hitting its 3rd standard deviation around 45.  Note that when it lost my lower trendline, we have a target of 23, which coincidentally is the 61.8% fibonacci retracement from the bottom in 2009 to the high in 2011.  Also, if you draw a trendline from the low in 2009 and connect all the other lows in 2010 along that line, it appears to meet the price around 23.  This is also very near the highs from the 2008 market which SHOULD serve as support for that reason. This is also near the 500 day simple moving average which should be support. Currently the stochastics are overbought and it met pretty good resistance at the moving averages and the 38.2% fib retracement after stopping near the 50% fib.

Silver at 23 would be a gift.  You can sure bet the money guns will come blazing then.  I'm actually terrified of that.

You're welcome.

"The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back... soon or late, it is ideas, not vested interests, which are dangerous for good or evil."
-- John Maynard Keynes, "The General Theory of Employment, Interest and Money"

"... the benefits of a depreciating currency are not restricted to the government. Farmers and debtors and all persons liable to pay fixed money dues share in the advantage. As now in the persons of business men, so also in former ages these classes constituted the active and constructive elements in the economic scheme… The tendency of money to depreciate has been in past times a weighty counterpoise against the cumulative results of compound interest and the inheritance of fortunes. … By this means each generation can disinherit in part its predecessors’ heirs; and the project of founding a perpetual fortune must be disappointed in this way, unless the community with conscious deliberation provides against it in some other way, more equitable and more expedient."
-- John Maynard Keynes - Essays In Persuasion

"By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method, they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls . . . become 'profiteers', who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished not less than the proletariat. As the inflation proceeds . . . all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless."
-- John Maynard Keynes, "The Economic Consequences of the Peace", pages 220-223 (1919).

"There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million can diagnose."
-- John Maynard Keynes, "Economic consequences of the peace"- Unseen Hand, page 57

It is going to happen because it must.

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