27 Dec 2012

Considering the oversold nature of the short term indicator and the late day comeback rally, we may get a bounce rally these last two days of December.

Things are not looking good for 2013 considering the large negative divergences in both of these charts and the macro-economic headwinds.  However, we are still in the seasonally strong part of the year until March / April.  VIX has broken out of the pattern I pointed out two weeks ago.

As the Fed continues its QEInfinity program, we are still experiencing monetary supply hyperinflation as the Fed monetizes the entire US Govt deficit.  The only question is what assets the new money leaks into.

26 Dec 2012

25 Dec 2012

 Medium term has only flatlined while the Dow has fallen somewhat substantially.

Short term has done the same.  I don't consider this a conflicting signal, but I will admit that it is not showing significant weakness behind the scenes which may be expected.

Merry Christmas or Happy whatever holiday you want to celebrate.  Wishing you health, wealth, freedom, truth and company.

19 Dec 2012

 Trying for more.

VIX is very close to breaking through resistance trendline.  Quite a change in character today.

"Basically, what Economic Hit Men are trained to do is to build up the American empire. To create situations where as many resources as possible flow into this country, to our corporations, and our government, and in fact we've been very successful...We knew Saudi Arabia was the key to dropping our dependency, or to controlling the situation. And we worked out this deal whereby the Royal House of Saud agreed to send most of their petro-dollars back to the United States and invest them in U.S. government securities...The House of Saud would agree to maintain the price of oil within acceptable limits to us, which they've done all of these years, and we would agree to keep the House of Saud in power as long as they did this, which we've done, which is one of the reasons we went to war with Iraq in the first place...So we make this big loan, most of it comes back to the United States, the country is left with the debt plus lots of interest, and they basically become our servants, our slaves. It's an empire. There's no two ways about it. It's a huge empire. It's been extremely successful...This empire, unlike any other in the history of the world, has been built primarily through economic manipulation, through cheating, through fraud, through seducing people..."
John Perkins, "Confessions of an Economic Hitman"

18 Dec 2012

 I haven't shown this one in a while.  Note the significant divergence between the current peak and the last two.  TSV (middle) is maxed out and a short term RSI measure is overbought as well (it can stay up for a while though).

 Wow.  Bite my tongue.  As you can see, this type of bend back up is quite rare.

Short term is nearing overbought territory.

VIX is not at historical lows but it is getting quite low.

Bradley Turn Point this Saturday, right after the end of the world.  Something is going to change this rally.  Not sure what yet.  Patience.

"The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary."
H.L. Mencken

Thanks to NowandFutures for the below:
"Over the last thirty years, the United States has been taken over by an amoral financial oligarchy, and the American dream of opportunity, education, and upward mobility is now largely confined to the top few percent of the population. Federal policy is increasingly dictated by the wealthy, by the financial sector, and by powerful (though sometimes badly mismanaged) industries such as telecommunications, health care, automobiles, and energy. These policies are implemented and praised by these groups’ willing servants, namely the increasingly bought-and-paid-for leadership of America’s political parties, academia, and lobbying industry.

If allowed to continue, this process will turn the United States into a declining, unfair society with an impoverished, angry, uneducated population under the control of a small, ultrawealthy elite. Such a society would be not only immoral but also eventually unstable, dangerously ripe for religious and political extremism.

Thus far, both political parties have been remarkably clever and effective in concealing this new reality. In fact, the two parties have formed an innovative kind of cartel—an arrangement I have termed America’s political duopoly, which I analyze in detail below. Both parties lie about the fact that they have each sold out to the financial sector and the wealthy. So far both have largely gotten away with the lie, helped in part by the enormous amount of money now spent on deceptive, manipulative political advertising. But that can’t last indefinitely; Americans are getting angry, and even when they’re misguided or poorly informed, people have a deep, visceral sense that they’re being screwed...

So I’m not going to spend much time describing ways to regulate naked credit default swaps, improve accounting standards for off- balance-sheet entities, implement the Volcker rule, increase core capital, or measure bank leverage. Those are important things to do, but they are tactical questions, and relatively easy to manage if you have a healthy political system, economy, academic environment, and regulatory structure.

The real challenge is figuring out how the United States can regain control of its future from its new oligarchy and restore its position as a prosperous, fair, well-educated nation. For if we don’t, the current pattern of great concentration of wealth and power will worsen, and we may face the steady immiseration of most of the American population...

Before getting into the substance of these issues, I should perhaps make one comment about where I’m coming from. I’m not against business, or profits, or becoming wealthy. I have no problem with people becoming billionaires—if they got there by winning a fair race, if their accomplishments merit it, if they pay their fair share of taxes, and if they don’t corrupt their society...

But that’s not how most of the people mentioned in this book became wealthy. Most of them became wealthy by being well connected and crooked. And they are creating a society in which they can commit hugely damaging economic crimes with impunity, and in which only children of the wealthy have the opportunity to become successful.

That’s what I have a problem with. And I think most people agree with me."
-- Charles Ferguson, "Predator Nation"

16 Dec 2012

Do those look like a trend change to you?  The only thing we have to wait and see is the VIX.  It appears to have broken above my trendline, but sometimes they can pull back to the trendline before rising again.

13 Dec 2012

 Medium term appears to be headed downwards.

Short term appears to have made a bearish negative divergence.

The VIX continues to build pressure and coil.  It hasn't broken out yet.  If it wants to stay within the line, I'd give it maybe a week of slightly up / flat moves for it to do so.

Sorry the posts have been a little short lately.  I have been busy.

"It had long since come to my attention that people of accomplishment rarely sat back and let things happen to them. They went out and happened to things."
Leonardo da Vinci 

12 Dec 2012

11 Dec 2012

 New highs are lagging the previous peak substantially.

 Medium term still leaking higher until its not.

 Short term is heading back into overbought territory.

I saw a lot of websites saying today's up move doesn't make sense.  The stock market never makes sense.  Accepting that is one of the first steps to getting better at it.  Its based on humans.  Human emotion is irrational.  Therefore the stock market is.  Accept it.

8 Dec 2012

"If you keep on gouging and devouring each other, watch out, you will be destroyed by each other. "
Gal 5:13

6 Dec 2012

 The medium term summation index is still heavily lagging.

The short term summation index has popped nicely recently, but also remains below its recent high.

The short term index still continues its decline from its ridiculously overbought levels.  If the indexes continue to get pushed upwards, the current non-overbought readings give it some room for a bounce upwards.

Gold lost its recent trendline support earlier this week.  Silver still maintains its recent trendline.  This is a bit odd that silver appears to be leading gold (like what happens when both have great gains), but it is still historically much "cheaper."  I may post a more in depth analysis this weekend on the metals.

I picked up the newspaper from the mailbox, but it contained nothing of any importance, only the
things that journalists had decided we should know, feel involved in, and have an opinion about.
Paulo Coelho

5 Dec 2012

 Medium term could be rolling over.

Short term declined again today, but could make a run for a divergent high considering the positive price action today and VIX off lows.

We are still in a seasonally strong period.

4 Dec 2012

It is an old maxim and a very sound one, that he that dances should always pay the fiddler. Now, sir, in the present case, if any gentlemen, whose money is a burden to them, choose to lead off a dance, I am decidedly opposed to the people’s money being used to pay the fiddler…all this to settle a question in which the people have no interest, and about which they care nothing. These capitalists generally act harmoniously, and in concert, to fleece the people, and now, that they have got into a quarrel with themselves, we are called upon to appropriate the people’s money to settle the quarrel.
Abraham Lincoln in a January 11, 1837 Speech in the Illinois Legislature Concerning the State Bank

3 Dec 2012

"On the issue of inflation, I think I could solve it no matter how much money it took."
Pat Paulson: 1968 Presidential Candidate & Comedian

2 Dec 2012

 Still overbought in the long term.  Divergence between the previous two peaks as well.

 Almost at 60% for the medium term.  Seems we will soon be overbought in the medium term as well.

Still overbought in the short term.

"Never argue with a fool, onlookers may not be able to tell the difference"
Mark Twain

29 Nov 2012

 Almost back to neutral.  When/if this rolls over, we should see some substantial selling.  It may take a few more weeks for holiday complacency to disappear.  I'll post what I see.

Short term remains overbought.  A negative divergence in the previous peak and the next will be bearish.

I've been thinking about the tax situation.  If indeed taxes do go up (Obamacare, fiscal cliff, etc), it seems it would be better of me to keep paper losses (yes, I do have paper losses even though I've hedged this latest move) to realize them in 2013, and pay 2012 tax rates on my profits this year.  I'd like readers thoughts on this.  I also recognize that because the Federal Reserve loans as much new money into existence as required by the government, I'd guess that it is safer for Washington to continue using the inflation tax, that so few understand, instead of real transparent tax.

"We are grateful to The Washington Post, The New York Times, Time Magazine and other great publications whose directors have attended our meetings and respected their promises of discretion for almost forty years. It would have been impossible for us to develop our plan for the world if we had been subject to the bright lights of publicity during those years. But, the world is now much more sophisticated and prepared to march towards a world government. The supranational sovereignty of an intellectual elite and world bankers is surely preferable to the national auto-determination practiced in past centuries."
David Rockefeller at the Bilderberg Meeting in June 1991 in Baden, Germany, as quoted in the 1991 issue of the Hilaire duBerrier Report

28 Nov 2012

 Medium term neither overbought nor oversold.

 Short term remains overbought.  Does not preclude a bounce attempt at a new high.

Long term remains overbought.

I'd like to thank those who regularly visit, and support my sponsors and advertisements.

"The money power preys upon the nation in times of peace and conspires against it in times of adversity. It is more despotic than monarchy, more insolent than autocracy, more selfish than bureaucracy."
Abraham Lincoln

27 Nov 2012

 Short term faded some more off of extremely overbought levels.

Medium term is still heading up.

"[It was] the poverty caused by the bad influence of the English bankers on the Parliament which has caused Benjamin Franklin

26 Nov 2012

 Medium term has at least broken its downtrend line.

Short term remains overbought.

Greece Plan M has hatched.  I'm sure it will be a stillborn like the rest of the plans.  The problem is structural.  The government borrowed more than it could ever raise in taxes from an aging / departing / suicide committing populace.  I'm waiting for when people will start to ask why is it normal for a sovereign government to be able to borrow at all.  Why should governments have credit ratings?

I get it, countries have "emergencies" (war, new infrastructure) that they need to borrow for.  However, it becomes a problem when the government gets to declare what is an emergency and rely on their banker buddies to lend the money into existence diluting every saving citizen's wealth.  Let's cut up the credit cards so people can go back to their lives.  Governments only spend what they can raise in tax revenue without needing violence.  It's that simple.

25 Nov 2012

23 Nov 2012

It was only a week or two ago when I was harping that we were oversold in the short term.  Amazing greediness has returned in this light volume week. We are near all time highs in my short term indicator - overbought.  The only two times near here were in August 2011.  Both bounces failed in the short term.


"The only way to deal with an unfree world is to become so absolutely free that your very existence is an act of rebellion."
Albert Camus

21 Nov 2012

"The paper system being founded on public confidence and having of itself no intrinsic value, it is liable to great and sudden fluctuations, thereby rendering property insecure and the wages of labor unsteady and uncertain. The corporations which create the paper money can not be relied upon to keep the circulating medium uniform in amount. In times of prosperity, when confidence is high, they are tempted by the prospect of gain or by the influence of those who hope to profit by it to extend their issues of paper beyond the bounds of discretion and the reasonable demands of business; and when these issues have been pushed on from day to day, until public confidence is at length shaken, then a reaction takes place, and they immediately withdraw the credits they have given, suddenly curtail their issues, and produce an unexpected and ruinous contraction of the circulating medium, which is felt by the whole community. The banks by this means save themselves, and the mischievous consequences of their imprudence or cupidity are visited upon the public. Nor does the evil stop here. These ebbs and flows in the currency and these indiscreet extensions of credit naturally engender a spirit of speculation injurious to the habits and character of the people. We have already seen its effects in the wild spirit of speculation in the public lands and various kinds of stock which within the last year or two seized upon such a multitude of our citizens and threatened to pervade all classes of society and to withdraw their attention from the sober pursuits of honest industry. It is not by encouraging this spirit that we shall best preserve public virtue and promote the true interests of our country; but if your currency continues as exclusively paper as it now is, it will foster this eager desire to amass wealth without labor; it will multiply the number of dependents on bank accommodations and bank favors; the temptation to obtain money at any sacrifice will become stronger and stronger, and inevitably lead to corruption, which will find its way into your public councils and destroy at no distant day the purity of your Government."
President Andrew Jackson, in his farewell address of March 4, 1837 Source