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Monday, December 12, 2011

SPX and NDX Update: Market Appears Poised to Break Recent Lows

The market continues to try to convince us that it's strong, as it wallows around just below the 200 day moving average and a bevy of resistance lines.

I remain convinced that there is much more downside than upside left in this market over the medium and long term; and over the short-term, I am quite skeptical of Friday's rally.

Deciphering the shortest term counts is quite challenging right now, due to the series of gaps since November 28, which present difficulty in the study of the finer wave movements which I usually depend on to clarify structure. I have gone back and cross-referenced the overnight futures markets with a dozen different cash markets, but the structure still remains open to a high degree of interpretation.

The first chart I'd like to share is a big picture support/resistance chart of the Wilshire 5000, which is an extremely broad index that does a good job representing the essence of the entire market.  This chart shows the market remains pushed up against several resistance lines, as well as the 200 day moving average -- collectively, these things should be quite a hurdle for the market to push through.  (It's worth mentioning that the Dow Jones Industrial Average has already closed above its 200 dma, however the Dow has an "upward bias" due to the fact that it consists of only 30 of the market's strongest companies.) 

A close study of this Wilshire 5000 chart can be revealing.


The next chart is the Nasdaq 100 (NDX).  The advantage on this chart is that the top is quite clearly defined, unlike the S&P 500 (SPX) and some others.  On the NDX, the decline so far could be counted as a series of 1's and 2's. 

On Friday, I shared a chart with the TRIN and advance/decline volume ratio that has proved quite reliable over the years; and I discussed how those indicators were pointing to lower prices over the next few sessions.  If the 1's and 2's interpretation (annotated in blue and red) is correct, we should see lower prices over this week, quite possibly in the form of a very strong decline.   

If the market instead trades above the knockout level of 2343.10, then that blue and red interpretation is definitely wrong -- and the labeling annotated in black is probably correct, which should see the markets continue on up over the October highs (though my work is suggesting only marginally higher).


Virtually everything I've looked at suggests lower prices are coming this week, but the chart shown above pretty well illustrates why it's a difficult call -- the structure is still at a point where one could count it either way. 

The one (and virtually only) concerning statistic I see for bears right now is Friday's CFTC figures (commitment of traders), which revealed that the market is now holding its largest net short position in the Euro in 18 months. This suggests that large declines in the Euro may be unsustainable at the moment -- and as we observed last weekend, the Euro is driving the US markets.  However, at the moment, I am letting the wave structure override the Euro figures regarding my preferred view. 

The SPX chart shown below shows my preferred view that lower prices are due this week, one way or another.  The second alternate count says that wave B bottomed at the recent 1231 low.  My second alternate seems to be the count many Elliotticians are favoring, but I don't like it very much for a few reasons:

1)  The existing retracement was quite shallow for a B wave.
2)  My confirming indicators, such as the ones shown on Friday, continue to argue for lower prices.
3)  The short-term wave structure, although difficult to get a handle on, seems to suggest that lower prices are in order.

The knockout level is close enough that we should have an answer soon enough.


One thing I've become fairly convinced of is that even if the bullish alternate count is in play and has bottomed (the third alternate count), it probably won't amount to much more than a double-top. Given what I'm seeing currently, if the bullish scenario were to play out, I expect it likely that the indices would only make a modest new high above the October highs, and then reverse lower.  Again, I view it as unlikely that Thursday marked a bottom, and more likely that the market heads lower more or less immediately.

The final chart is presented for educational purposes, and shows how the decline off the high in the SPX could be counted as an impulse and correction.  I believe this is the correct count, and it would be confirmed by a break of the 1231 lows.  A break of the recent high at 1267.06 would prove me wrong.


In conclusion, I remain long and medium term bearish.  Unless and until the indices break their recent highs, I remain short term bearish as well.  Things could always change going forward, but given the market's current position, I simply don't see much hope for the bulls -- outside of the eventual potential of a marginal new high above the October highs, which might never come to fruition.  Trade safe.

The original article, and many more, can be found at http://PretzelCharts.blogspot.com

225 comments:

  1. Morning all, as I posted on the other thread back when the futures were flat/slightly green, I think the bears should have a decent day today.

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  2. Still short ES from 1257 btw.

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  3. ES might get back to 1252-1254 on a bounce.  Could be a good opportunity to add shorts... unless I'm reading this whole thing wrong. 

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  4. Morning PL thanks for the update, may I ask what is ES

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  5. S&P futures contract.

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  6. Should we bet oin a new high above October? Shall I bet? I will go on holydays right now

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  7. I pretty much put it all out there w/ the update.  ;)

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  8. Great work on the WLSH - thanks for posting.

    China continues to look anemic, metals wavering,USD surging and confusion still abounds - Damn, this is fun!

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  9. Beautiful analysis.  Thanks for the update.

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  10. Thanks, guys.  :)

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  11. PL,

    On your NDX chart, could it be a falling leading diagonal right after wave blue 2?

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  12. It could, and I considered that as well, which is why I placed the KO at the wave 2 high.

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  13. A sharp one-day selloff into the upper reaches of target zone B (black count) has my eye. It wouldn't violate the 20 dema by too significant  an amount, and would drive my volatility measures into the buy zone.

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  14. Just covered ES shorts at 1246.5, with the thought of either shorting again higher or getting short again on a break of today's low.

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  15. Hussman Weekly Commentary:-"Hard-Negative
    With the exception of extreme market conditions (see Warning- Examine All Risk Exposures , andExtreme Conditions and Typical Outcomes ), I try not to wave my arms around about near-term market risks, but I think it's important to cut straight to the chase here. The present market environment warrants unusual concern, in my view. Based on a wide variety of evidence and its typical market implications over an ensemble of dozens of subsets of historical data, the expected return/risk profile of the stock market has shifted to hard-negative. This places us in a tightly defensive position. This isn't really a forecast in the sense that shifts in the evidence even over a period of a few weeks could move us to adjust our investment stance, but here and now we observe conditions that have often produced abrupt crash-like plunges. This combination of evidence includes elevated valuations, overbullish sentiment, market internals best characterized as a "whipsaw trap" on the basis of typical follow-through, heightened credit strains, and clear evidence (on reliable forward-looking indicators) of oncoming recession, among other factors."http://www.hussmanfunds.com/wmc/wmc111212.htm

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  16. btw, stopped back into shorts at 1245, cost me a point and a half, but I'm surprised that little correction earlier was the whole thing.

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  17. You are projecting a (3) wave down this week.  Just to confirm, this is a nested third within 2 higher degree third waves down.  So there is the potential for a lot more downside, in line with your IT, LT bearish conclusion.  I would think that this nested condition would cause wave (3) to project further down than you have drawn the blue box .

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  18. Good article.  I wish people would read this part, since I keep hearing this irrational fear from bears that the EU will do a form of QE, to which I keep replying, "they can't, it's forbidden by the treaty."

    "Notably, the restriction in Article 123 specifically prohibits the ECB from "any financing of the public sector's obligations vis-a-vis third parties" - this does not simply restrict the ECB from buying debt directly (which could be circumvented by buying distressed debt on the open market). Rather, it is a restriction against using the ECB as a funding mechanism for public sector obligations. Read Draghi's lips: the ECB will not be initiating massive purchases of distressed European debt unless and until the EU Treaties themselves are explicitly changed. "

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  19. Morning Pretz. Wave 3 Bear Party seems to be getting started. I also suspect that only Ben can stop it. And I think he doesn't this year. Every

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  20. Yes, the blue box would be the first target, and I kept it because it's a generic target that works or both counts.  It will be adjusted as and if needed.  :)

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  21. *or being *for

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  22. Morning.  Why are all your posts getting cut off lately?  This is like your third post in the past couple days that ends with the first word of a new sentence.

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  23. I may cover positions today because I don't want to hold too much short ahead of Ben.  That man dreams of crushing shorts in his sleep.

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  24. Even if this is the bullish alt. count, 1220-1225 should be very do-able.

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  25. Yes, ECB & Germany have this past week reiterated that monetary financing of PIIGS debt is not going to be allowed. For the ECB to embark on substantial legitimate printing akin to the Fed & BoE, true fiscal union would have to already be in place: a union which involved very large fiscal transfers from strong (Germany) to weak (PIIGS), and likely involving some form of common debt issuance - both thinhs to which Merkel says "nein". 

    Of course, anything could change, and events may ultimately force that, but the above is the present situation.

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  26. Italy 10 year bond yield sky rocketed (over 7.3%).

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  27. Covered my ES short at 1242.25 - made 16 points since aftermarket Friday.  Already down below 1240, looking to get short again on the next major bounce.  Thinking 1250 if we get back there.  Might hold off on any short positions into tomorrow's meeting though.

    Still hold core short position  in TNA.  Might cover some today and add back later.

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  28. Hmm.  Guess you didn't read my 2nd post... I'm short again from 1245.  If this is a third wave, it's just gonna run and run.  Won't see 1250 again for awhile.  :)

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  29. 940AM ET

    Gold is already down 45 dollars today, and leading the way down, since it broke the $1670's big support.  So now, a fast trip this week, to the lows $160 0's, is what I expect, since I see no resistance at all, between $1670 and $1610's.

     Silver, the weak sister pm, as I have been expecting,  is down over a dollar today, in the low $31's.  When gold goes down to low $1600's this week, silver will at least retest low $30's, possibly more.

    Spx is still strong though, I want a LOT more that 15 points down, I keep opining, for usa dumbmoney to sell big, the shocking bad news MUST come from the usa itself, and not Europe.  I mean, the usa markets, continue to outperform all world markets, and in MY opinion, that is sheer usa sheeple lunacy, believing there is a forthcoming recovery in the usa.  But once 1 BIG usa banks fails, or nearly fails, even dummy amerikans will FINALLY enter the 'point of recognition.'

    Dax down 2.3% right now.  News last week was that MANY European millionaires are moving their ENTIRE personal and corporate funds, out of their own debtor eu countries, and into---GERMAN BANKS.  This making front page news presages that acceleration time is nigh.  Acceleration down panic, of regular citizen moneys abandoning weak Eu banks, and moving into strong ones, and possibly---only into PRIVATE banks soon, inside Switzerland, Andorra, Guernsey Islands, and the like. 

    The thing to look for now is---signs of downward acceleration.  When the panic starts, things will move fast, like lightning.  I enclose 2 charts showing such acceleration.

    And I mean panic not just in terms of money (or lack thereof, better said), but in term of human existences at streetlevel, and boardrooms too.  Remember, las week, the president of Deutsche Bank was sent a letter bomb, that if his mailroom didn't routinely x-ray all mail, pres. Ackermann would be dogfood chow right now.

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  30. Thanks.  Already kicking myself for covering, but hey, no one ever went broke taking a profit and I am still short in TNA and Jan 120 puts I picked up on Friday (shout-out to Brianhut on those).  Looking to take profit soon on those puts also.  Maybe I'm too skittish, but I don't like holding futures and options too long.

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  31. Yep, when we hit the heart of that third wave, there will be no coming up for air in this market.

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  32. Yeah gold was ugly right from the get-go last night.  Dropped like a stone to 1690 right after the futures market opened.  The symmetrical triangle that everyone was watching on that chart resolved to the downside it appears.

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  33. Uh, Pretzel, you've been hijacked.  Clicking on your link above for pretzelcharts.blogspot.com diverts to gospelsongs.com
    NO kidding, -LOL

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  34. The earnings warnings are starting to dribble in - Texas Instruments, Dupont, Intel etc.......once that wave starts crashing ashore - there won't be much to be bullish about even for the most ardent bull

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  35. ah, so Friday was the short buster.  they got me.

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  36. ???

     Currently ~6.7% :-
    http://www.bloomberg.com/quote/GBTPGR10YR:IND/chart

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  37. The EOD around 1257 was a friggin' gift.  Glad I woke up in time to take advantage.

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  38. Ben NEEDS for Obama to be re elected or he's gone. So that bullet isn't getting shot tomorrow. I suspect both Bam Bam and Ben would love to start the 2012 at a lower point sp that in October, we are talking about a 'recovery' in both the market indexes. There is no recovery in the indexes to talk about if we start the year at Dow 12,000.

    For the moment Ben is *probably* more on your side than you might think. He sure as hell won't be from June onward though.

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  39. Yeah, QE3 ain't comin' this time either.  Just like I said last two times bears was a'sceered of it.  They need to save that bullet for later.  Market's not even near critical levels yet.  Plus they're still workin' it with Operation: Twist.

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  40. But... there's always the... uh... There's... hmm.  Nevermind.

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  41. Good morning PL. Just wanted to thank you again for your excellent work. I'm not a day trader, retired and try to make a few bucks on the long term direction of markets...I'm a technical person(engineer) and find your analytical saviness in the framework of EWT remarkable! I'm learning a great deal from you and others on the site....keep it up.

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  42. Lol.  You're a better man than I - well, certainly when it comes to trading methinks.  :)  Now there's the psychological thing where I don't want to short again at levels below where I covered.  Hope we get some bounce, if not, I'll leave ES alone for a day or two and concentrate on short tna.  Already covered my puts too, just a few minutes ago.

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  43. has there ever been (in recent memory) such a strong futures market with such a dull cash market?  I dont trade futures due to lifestyle and am missing all the big moves!

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  44. Thanks, Fred.  :)

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  45. Would it be suicide to to go LONG around 1220-1225, with a stop below 1215?  20 and 50 day sma's are both in the 1220-1225 zone which was also previous support.  Any one else thinking about this, or did everyone just simultaneously smack themselves in the forehead and say "what is he THINKING?"

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  46. Yep, happened quite a bit in '08, too.  I keep trying to warn everyone that the big overnight moves will become the norm.

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  47. I'm not planning on counter-trend trading much, unless I see confirmation of the alt. bull count.  If I did, I would use VERY tight stops, since if this is a third wave down, and not the bullish count, it's going to be fast and furious and I personally don't counter-trend trade during any type of third wave.  Maybe once it bottoms, I'll go long for the fourth wave bounce.

    That's just my personal preference, not trading advice of course.  If this is the bullish alt. count, you'll be kicking yourself -- so do what you think is right.  Be aware though that even the bullish alt. count could extend quite a ways beneath that target...

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  48. What are you thinking?

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  49. Also, keep in mind that psychologically, you will be more prone to doing something "stupid" now, since you covered way too early.  You will be trying to come up with strategies to "make it back."  These strategies are more likely to be based in emotion than logic.  Just something to keep in mind.  :)

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  50. basically make all the money on a thin futures market, dump inventory on the retail side- make me wonder if we rally from here...

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  51. Gonna break that 1231 low in the first few hours, it looks like.  I'm pretty happy w/ myself -- that was a very hard short-term count to nail.

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  52. very good point

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  53. eur/usd at Black Friday lows - but SPX 75pts higher than Black Friday......hmmmmmm

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  54. I checked with symbol, it:10yr_ita, for Italy 10 year bond yield.  Is it correct?

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  55. Wait!  Santa Rally! Dont Forget everyone!  We've been pinning our hopes on that since... October!

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  56. I thought so too. I added more Jan SPY puts around 1,255. I wasn't expecting this quick a reversal, but I'll take luck when it shows up. Looks like Friday was another textbook let's fuck over and clear out all weak shorts kinda day. And now the real business of what the market wants to do can begin . . .

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  57. Yeah, point taken.  I am still short a decent amount via tna, but was trying to form a plan for tomorrow afternoon after the Fed's statement in case there's even more dovish talk about MBS purchases which juices the market.  Considering the confluence of moving averages and the fact that that level has been support many many times over the past  few months, I think that is a logical place to look for a bounce.

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  58. the 50day ma is fairly meaningless, its just a way to keep count.   It's the 200day ma that has been around for over 100years, just like the dow jones averages, and it means A LOT.

    And yes, as to your desire to go long at 1220, yes, good idea.  Suicide is good for many sheeple.

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  59. going long around 1233 via sso, on the chance that the short busters are going to make a move... really really really tight stop

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  60. fyi, this could be the stupid move pretzel warned about a few posts below...

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  61. Looks like you may have hit the morning lows.

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  62. I tell you, until internal usa BAD 'news' hits the wires, the usa dumb 5thwave money won't sell.  I am astounded at how many internal proofs there are, that there are millions of usa sheeple still buying strong, for they are totally brainwashed to always believe the usa newspapers, tvnews, etc, that there is a usa recovery, except for those bad people over in Europe.  BULLSHIT.  the situation in the usa is just as bad, or worse, than in Europe.  However, the usa ubermen have the trained seals usa sheeple ready to believe it is always others, and not them, that are causing problems.  The usa bigbanks have ALL been bankrupt since late 2007, when the 50 year bubble finally blew.  However, because the mark-to-market rules were dropped, in early 2009, the usa banks have been aboe to hide all their true losses, and their true NEGATIVE networth.  So, that makes the amerikan ubermen the best liars around.  No problema.  It's a coming, without a FUCKING DOUBT, to everybody.  Just, the usa market won't break, until it is OBVIOUS to every usa moron, THAT THERE IS NO RECOVERY.  THEN, and only then, the usa morons will finally sell, ALL AT SAME TIME, since that is what herded sheep do.

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  63. Lol.  You're like the Don Rickles of this blog - its actually growing on me.

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  64. All at the same time is right, fer sure.  Even if Europe *is* worse-off than the US, it won't matter in the grand scheme of things.  Everybody owes everybody else.  If I owe you a million dollars, and you owe Rocky a million dollars and Rocky owes Brian a million dollars... if *I* alone go bankrupt and don't pay -- ain't nobody gettin' paid.  Now you and Rocky and Brian are all bankrupt too. 

    That's over-simplified, but that's the gist of the problem.

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  65. Nice catch!  (see photo)  :)
     
    So far this has the appearance of a corrective wave that won't hold.

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  66. btw, the photo was labeled with "financials" and I didn't feel like taking the time to change it.

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  67. VIX isn't spiking.  Maybe that'll follow but for now its up less that 1 point.

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  68. Wonder where the rest of the gang is this morning?  Usually big red candles have lots of people posting.  Too many get chased out, I wonder?  Or too scared to get short again?  I got stopped out Friday morning, which worked out great for me in the end -- but, man, you gotta take a crack at a gift like 1257.

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  69. USD on the verge of a massive breakout here - could possibly lead to that violent wave 3 decline soon.

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  70. I believe you are right - Lots of people got beat up last me - me included.  How the market didn't gap down huge Friday on the Europe can kick get nothing done plan is beyond me

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  71. Keep in mind that this market is now a very thin range.  Every ounce of territory from here down to about 1115 has now been traded across at least 9 times.  Support should be pretty weak throughout.

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  72. If what the "sheeple still buying strong" refers to the markets, the volume is very low and has been for some time on average. If you are refering to the American consumer buying "stuff" and simply spending, it is amazing, but the average American really doesn't watch financial news till it hits the USA Today headline... and even then they don't pay attention till they get their quarterly statements for their IRA's. They just want their feel good fix of materialism, weather they can afford it or not.
     
    Many, many of the poeple I speak to really don't want to hear any of the reality of what's going on in the markets. They ALL, without excpetion so far which amazes me, are truely of the belief that the "THEY" will fix this (and all the libs I speak to say the same with the added jab that we need to tax more and spend more...aCk!).

    I think they are doing what Americans seem to do best... ignore it until the walls are falling on them. Indiference and appathy in all areas except for their immediate world, seems to be the norm.

    No doubt that there will be that moment that they all run for the exits in the market and stop purchasing, stop driving, stop vacationing and scream from thei flooded rooftops that the government should have made this all right.

    My job however, it to make as much $$ as possible and get the timing right so that I don't look like a complete idiot buying a pallet of rice and beans at Costco and load them into the car next to my bullets and seed stock!

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  73. If my count on the dollar is right, it's in a third of a third wave UP right now.

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  74. Just woke up. But its nice to see a red candle. I hope this is the third wave, I didnt protect my profits last time and got killed by that Ben and his friends. Anyhow, the R2K isn't tanking as hard as it usually does (more than the s%p) when theres bad news. Its on par with the S&P and I think once financials start leading, the third wave will start picking up steam.


    also great analysis pretz, as always. I shall name my first unborn child after you, and although the other kids may make fun of him for being named pretzel, he will one day understand. lol

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  75. Sorry, I meant violent wave decline 3  in SPX* And yes, if USD gets rolling here we could easily see the USD put on another few points by the end of the week.

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  76. The irony is that this is what the market needs to decline.  Shorts are the best source of support for a falling market.

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  77. I actually understood you right, sorry.  :)

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  78. Np PL, keep up the good work as always and get some well deserved sleep :) 

    What's rather amazing is the richness of ES/AUD to EUR. EUR is back near the 10/5, 11/25 lows and ES is rich by some 70-100 points to both time periods. If USD breaks out here, this disparity seems like it would be corrected quickly no?

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  79. Options, yes.  Futures, no time decay.

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  80. 1233-1235 seems like the rang we're bouncing around. Is there any significance to this?

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  81. It's just a natural place to cover, in anticipation of a possible double-bottom at the prior low of 1231.

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  82. Great analysis PL!  Everything on Friday was highly suspect.  How does TXN end up positive for the day after being down $2 overnight on a significant profit warning that "demand is down across all products and markets."  Can anyone explain how they are able to manipulate the price of TXN to this degree?

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  83. Same here mav (the profits, not the child).  I was in Italy and didn't want to access my account and risk getting hacked.   I've been holding on, somewhat painfully.

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  84. One would think.  These types of correlations can de-couple and re-couple at random, though.

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  85. And also, the average person has done very well with dollar cost averaging over 2009-2011. I think this fosters an "it will all be OK in the end" belief. And also, what else can they do? They can't all be day traders.

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  86. "Which do you think is a bigger problem in the world today?  Ignorance or apathy?"

    "I don't know.  And I don't care!"

    (rimshot)

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  87. Thanks.  :)

    Sell the rumor, buy the news; buy the rumor, sell the news... happens all the time.

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  88. Now it looks like my "lmao!" is in reference to you worrying about your account getting hacked.  How insensitive!

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  89. It does definitely foster an "it will be okay" complacency.  But at the same time, '08 is still fresh in everyone's mind, so you can imagine a lot of investors will be quicker on the sell trigger this time around...

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  90. Yea - on the last move down to 1150 it didn't do much either.  still a lot of bullish sentiment.  Hard to find a CNBC guest who doesn't say valuations are compelling, Europe is saved and the US can exist despite the rest of the world in recession

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  91. Quite true, however re-coupling seems more probable right now as liquidation ensues in FX/commodities and soon to bleed into equities...

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  92. Yeah, I was was setting you up..not.  W/o your analysis I wouldn't have had the confidence to hold.

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  93. Can anyone comment on what the volume on this down leg looks like so far (eg, is it supportive/is it confirming of a strong wave 3 decline just starting)?  Also, money flow?  Thanks.  GREAT WORK as always PL!

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  94. Just broke the prior low

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  95. PL - is SPX 1231 the final resistance

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  96. Stupid Disqus.

    Okay, try this again...  btw, ignore the falling knife picture that will probably come up with this...

    Anyway, as I am now retyping...

    This might be a good short for anyone looking to get back in the game IF AND ONLY IF IT BREAKS SUPPORT.

    2276 +/- is important support for NDX.  One would WAIT for a break of support, then short with stops above the line.  Or wait for a break and short the backtest.  Futures symbol: NQ.  Cash market you could use the cubes (QQQ).

    Of course this is NOT TRADING ADVICE.  Just hypothetical.  :)

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  97. Yep, my work here is done.  :)

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  98. Gold breakdown thru support from Oct 2008-Jan 2011  ---- Central Banks selling? OR hedge funds selling their winners? or foreign banks selling to get theri hands oon USD?

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  99. well that was fun and annoying. stopped out.

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  100. I don't know what this means.  Is it the last level of support in this market?  No, of course not.

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  101. While we're waiting for this little ii or b to break down, I'll just toss this out there as today's astro update.
    Mercury is still retrograde until tomorrow evening 8:40 pm EST. That means it is currently stationing direct in it's orbit from our geocentric perspective on earth. (the Starwalk app for Ipad etc, illustrates this beautifully, you can actually watch it leapfrog with the Sun).

    Mercury retrogrades, as stated before, are notorious for whipsaw trading, rangebound trading (especially around the station days) and technical analysis fake-outs.  Typically, you have to allow  2-3 days after the station to get a feel for the true market direction.

    With that in mind, we could blow through support here only to bounce back hard Wednesday.

    On another note, since Mercury rules contracts, communications, etc and it is within trine range (good energy) of Uranus that just stationed direct on Sat., you need to keep one ear out for the surprising news that may come out tomorrow - via Ben and friends or someone/somewhere else after market close.

    All of this still stays in line with Pretzel's counts, but may offer very short term trading situations for the next few days.

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  102. Gold looks like it's toast.  Barring an immediate reversal, this one should run for awhile.

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  103. good call pretz, 1227 on the nose!

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  104. 5 min spx chart set up some divergences and the last candlestick looks like a hammer.

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  105. Astro update ?  IN the words of John Mcenroe  - you can't be serious ?

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  106. Interesting... might jive w/ the bullish alt. count.

    But... then again, looks like a lot of bears got caught out, which seems to help the preferred count.

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  107. so where do we stand- is this the first aggressive sell off of the 3rd wave, or do you still see a decent chance of a rally to test the highs?

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  108. PL, thanks for your reply.  I understand that, but would expect a midday or late day return to the fundamental case - which should be back down.  Also, this would make sense if the stock had been in a downtrend for several days ahead of the announcement, but it wasn't.  It was in an uptrend for the 9 days before the announcement. For the stock to drive higher the ENTIRE day, right back to the previous day's close is absurd!  Who would want to aggressively buy the stock after that announcement with the stock in the weak technical position it is in? Most likely price manipulation by the market makers.  How do they get away with this?  Or... is this their job description - market making!

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  109. Great work PL! Just look at the beautiful impulse waves down. Opened a small call position in VIX 6 months out, given they are still pretty cheap. Since that third wave is coming, VIX is bound to spike at some point in the next 6 months. But VIX trading is always a wide freaking ride...I am embracing myself! 

    Pretty happy with the SPY shorts I opened at 1265 for ST and IT. I got stopped out of my short term puts on friday (small % of portfolio) but I am holding on tight to my 3 month out puts!

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  110. I was thinking the same thing. Gold at $1,500 in the next few months sounds a lot more likely to me than $1,800.

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  111. I have 2276 as support as well. All of Friday has now been retraced and I am looking at the beginning of the 3rd wave down. I used some Jan 2200 puts on the NDX before the break of 2276. thanks again for your great work.

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  112. PL,

    Great work as always!!!   We hit the upper range of the target box.  I see it going lower into EOD, but what are you targets for the rest of the week?  Fed speak can often result in a bounce....and I hear Italy is "fixed"  and "don't need no stinking badges"....I mean bailouts

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  113. This is where it gets tricky.  Both of my counts agreed up to this point.  The challenge now is that a C-wave (for the bull count) or a third wave (for the bear count) would both look exactly the same right here.  It won't confirm until we see a larger fourth/fifth wave.  I'll also have to look at other things tonight to try and make a determination. 

    I covered at ES 1227.50, btw.  Ready to get short again, either from higher prices or on a new break.  Cost me a point and a half last time, but if we get a big bounce off one of these levels, it'll all make itself back in a few hours.  :)

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  114. 6 mos ought to be a pretty safe window.

    Not trading advice or anything, just sayin'.  :)

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  115. What's the target for today's close? 50-day MA is at 1222 for $SPX.

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  116. We like both kinds, Country and Western! (Blues Brothers)

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  117. Alright, all, I need sleep -- targets hit, I can go rest easy knowing all my hard work has paid off.

    Orders entered, trades on auto-pilot now.

    Don't forget to please show your support if my work has been helpful. :)

    I'll bbl.

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  118. Oh brother... not another NDX Chart Forever Attachment... lol.  "NDX Chart Liberation Front" outta be happy at least, thought I haven't seen them around yet today.

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  119. Big fan of safe windows despite the premium. Thanks PL! Not trading advice ofcourse...

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  120. No, it is not oversimplified.  Nearly no one will get paid.  Or at best, paid at pennies on the dollar.  The thing is, in terms of the typical amerikan, much more brainwashed than any european, IMO 90 percent of amerikan sheeple TRUST their system and their leaders, at the CORE, despite their bitchin and moanin about it. 

    For example, banks deposits.  I will wage 90% of amerikans do not read the fine print that they sign, when they deposit their hard earned pennies, into any bank.  Yet, this fine print, in essence overpoweringly says these 2 most important things, which 90% of the sheeple, know nothing about.   1. you have just invested in our bank, by making your deposit, thus you have just linked your fate to ours---hence, you may or may not, receive back, your deposits and interest, accordingly.  2.  We have the legal power to totally close the bank for 1 entire week, zero outflows or inflows, in case of serious internal adjustment problems (paraphrased, but, believe it or not, VERY real).

    I assure you, laws have been put in place, for DECADES, to make sure the usa sheeple are LOCKED IN, into their banking system.  LOCKED IN.  No escape.  I assure you, there will be many more suicides in the usa, than in any other country in the world, percentagewise.

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  121. Intraday wave structure does look like wave-5 down was hit at $SPX 1227. Gee, I'm slow. :-(

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  122. Sleep?  Did someone say he is going to sleep?

    The NDXLF has a new music weapon in store - Justin Bieber!

    That or you will be forced to listen to the Jon Corzine Testimony Christmas Carol:

    http://wallstreetexaminer.com/2011/12/12/corzine-testimony-christmas-carol/

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  123. You agree with ME. 
    But you still do not see.

    It will take a usa event, for current usa mania to end.
    Not in Europe.  in usa.  the usa sheeple need to feel it at home, that their masters have lost control.

    Sort of like Animal Farm.

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  124. The biggest problem today is:  cynicism and sarcasm.

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  125. Hey Gekko - RE: Astro Update - you can't be serious?

    Do you even wonder what kind of "fur" is in Furrr - could B.Fox fur.

    Sorry, couldn't resist ;)

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  126. I do not understand the meaning of the planet locations, but I will state:  all existence on this planet is an alien experiment.  If you do the historical research, link all dots, it is obviously clear.  No 'god' bullshit.  Just aliens, more advanced, with longer life spans, just having a good time, with their planet earth biolab.  As such, I consider the film 'contact', one of the truer versions of existence on planet earth. 

    Ergo, blahblah planet location this or that, is as valid, as anything perceived as 21st century rigid-straightjacket 'objective'----just as any 'supernatural' power (or non-power), timetravel or timevision, noncorporal spirits, premonitions, esp, dreamwalking, possessions, mindovermatter, astral travel, etc etc---all valid.   Fibonacci figured the patterns of earth, crippled elliott in mejico, with nothing better to do pre-tv, studied that it applied to human herding also.  Whatever.  Who gives a fuck.  ALL is subjective, 100%.  So go get some tequila and a young slut.  I am.

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  127. I answered you in your post below.  Read it.

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  128. Since I know you are too lazy to read lower tomorrow than this level, I cut and paste MY response to you:PRETZELNONLOGIC SAYS----All at the same time is right, fer sure.  Even if Europe *is* worse-off than the US, it won't matter in the grand scheme of things.  Everybody owes everybody else.  If I owe you a million dollars, and you owe Rocky a million dollars and Rocky owes Brian a million dollars... if *I* alone go bankrupt and don't pay -- ain't nobody gettin' paid.  Now you and Rocky and Brian are all bankrupt too.  That's over-simplified, but that's the gist of the problem.
    ANON20 SUPERLOGIC SAYS----No, it is not oversimplified.  Nearly no one will get paid.  Or at best, paid at pennies on the dollar.  The thing is, in terms of the typical amerikan, much more brainwashed than any european, IMO 90 percent of amerikan sheeple TRUST their system and their leaders, at the CORE, despite their bitchin and moanin about it.  For example, banks deposits.  I will wage 90% of amerikans do not read the fine print that they sign, when they deposit their hard earned pennies, into any bank.  Yet, this fine print, in essence overpoweringly says these 2 most important things, which 90% of the sheeple, know nothing about.   1. you have just invested in our bank, by making your deposit, thus you have just linked your fate to ours---hence, you may or may not, receive back, your deposits and interest, accordingly.  2.  We have the legal power to totally close the bank for 1 entire week, zero outflows or inflows, in case of serious internal adjustment problems (paraphrased, but, believe it or not, VERY real).I assure you, laws have been put in place, for DECADES, to make sure the usa sheeple are LOCKED IN, into their banking system.  LOCKED IN.  No escape.  I assure you, there will be many more suicides in the usa, than in any other country in the world, percentagewise.

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  129. I am sure you are aware of the fact that VIX options are "European Style" options, different from the more popular equity/index options traded on US exchanges.

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  130. Rickles is a fucking screaming idiot, just like you,  B.umbkus  O.ral.  B.obo. 
    However, if you had said g. carlin, I'd say he is one dead amerikan, I respect.

    So watch this, amerikan MORONS, since at least one of you, was not a total IDIOT:
    http://www.youtube.com/watch?v=-PkWf9M3rUw&feature=related


    And if you are SLIGHTLY brighter, than ALL of your pieceofshit USA sheeple brethren, then watch ALL of this 'comedian's' youtube videos.

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  131. http://www.youtube.com/watch?v=-PkWf9M3rUw&feature=related

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  132. Yeah Pretzelnonlogic........and your mother smelt of elderberries too.  :-P

    Anon20, if all your money is in Dec puts, i.e. locked into the banking system, does that mean you don't believe your own gloomy predictions?

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  133. wave technicians- if we bounce from 1127, that will be the start of the corrective wave 3.  if we tank to 1198, that will be the continuation of wave 3?  Am I looking at that right?

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  134. I suspect that the only thing really holding the market here right now is opex and the slim hope that Ben announces something tomorrow (highly doubtful though). 

    Other than my IT short positions, I'll almost certainly close everything out by the end of the day and wait for Ben to tell us what he's gonna do. 

    And he tells us he's not gonna do much right now (tearing apart long dreams of their Santa Rally), I expect the falling knife scenario to play out pretty quickly.

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  135. Max option pain is at spy 124.0 and iwm 74.0 right now which suggests flat-to-up the rest of the week, but EU downgrades could trigger a sell-off and Ben could trigger a melt-up so who knows what's in store.

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  136. Firsfeature:  This is why PL said it gets tricky here - Look at the third chart of today's post.  We can still go down to 1198 and bounce back up for wave C of 2, or just a short corrective wave before we resume down. I'm sure PL will clear this up as soon as he can do new analysis.

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  137. Interesting, lowly worm, you remember what I wrote, weeks ago.  Yes.  I will lose almost all principal, if market does not crash, over next 4 days.  Tell ME, subhuman amerikan trash sliding worm, do you NEED ME to fail, enough for your own wimpsorryass bets, to also fail?  Pathetic freakoid, you are type of tapeworm that wannabe-messiah idiots like pretzelcraphead, attracts.

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  138. Exactly, which is why I will trade this lightly at the moment.  I see no reason to 'guess' with real money on the line.  When the answers will be revealed soon enough.

    With such a large measured move down to 1,230, I'm happy to close out here and wait to find out what Ben says.

    Some early 'tells' though:  Gold (and all metals) cratering + a rallying dollar + oil falling . . .  to me equals the market believing that Ben isn't going to save the day this time around. 

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  139. So you bought puts with which broker then? 

    Not that I care, but why would you believe that your broker or bank will return your money . . . .but no one else's will?

    And why is it that you are so fixated on Americans being stupid and the entire system needing to not just crash but completely self destruct? 

    Methinks this is more about YOUR internal impoverishment and misplaced fantasy and desires than the actual reality around you.

    I DO think there are going to be some very difficult times coming, btw.  The likes of which have not been seen before.  But your assumptions betray an utter lack of understanding of the system and country you claim to know so much about. 
    Whatever you want to say about American 'ignorance' . . . can actually be said about the native populations of ANY country ANYWHERE IN THE WORLD. 

    If one were to take a poll the middle and lower classes of ANY country of your choosing, you'd find that they know no more about the world than anyone here does. 

    Willful and mass ignorance of markets, financial structures, currencies, and the actual workings of the financial world is a rather universal human condition that isn't confined to any one country's borders, you know. 

    And if there is a country that will weather any financial shit storm better than the rest of the industrialized world, it's us.  And also Canada, Australia and Great Britain.  About that I am utterly fucking certain.

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  140. lmao - good stuff!

    BTW, I am also net short, though I lightened up a decent amount today.

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  141. From  Graham Summers-Phoenex Capital;
    I wanted to share the following news articles which the mainstream media is completely ignoring:European CEOs Move Cash to Germany In Case of Euro Breakup Grupo Gowex, a Spanish provider of Wi-Fi wireless services, is moving funds to Germany because it expects Spain to exit the euro. German machinery maker GEA Group AG is setting maximum amounts held at any one bank...Bayerische Motoren Werke AG, the world's largest maker of luxury cars, has honed its plans developed following the 2009 financial crisis and is prepared to act if markets dive, Chief Financial Officer Friedrich Eichiner said in November....Kingfisher Plc (KGF), Europe's largest home-improvement retailer, has considered plans for the possibility of a collapse of the euro region and will focus on cash generation to account for that possibility, Chief Executive Officer Ian Cheshire said.

    Source: Bloomberg
    Eurozone banking system on the edge of collapseIf anyone thinks things are getting better then they simply don't understand how severe the problems are. I think a major bank could fail within weeks," said one London-based executive at a major global bank.Many banks, including some French, Italian and Spanish lenders, have already run out of many of the acceptable forms of collateral such as US Treasuries and other liquid securities used to finance short-term loans and have been forced to resort to lending out their gold reserves to maintain access to dollar funding. Source: The TelegraphThese are CEOs and bank executives, NOT politicians oracademic hacks... all preparing for a banking collapse in Europe... which they all believe is coming as soon asthe next few weeks.The message here is simple: the Powers That Be havelost control of the financial system... and we are now FASTapproaching a Crisis that will out-do even the 2008 collapse.Indeed, interbank liquidity in Europe is actually antipating something even WORSE than that.Which means we have at most a few weeks to preparefor the next mega round of Deflation. So if you have notalready taken steps to prepare for the next round of theGreat Crisis... you need to do so now.

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  142. that 'sort corrective wave' should be wave 4 then?

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  143. that 'short corrective wave' would be wave 4 then?

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  144. PL/others: what is your interpretation of VIX staying below 30 given ppending collapse, is it simply excessive complacency?

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  145. Wow, glad I got out.  Market moving up to 1,235 to await word from Ben does make some sense.

    There was no way I'd have gone long here though.   Wht the market does after Ben's announcment will tell us an awful lot.

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  146. There really isn't anything for them to save at this point - economy has improved some, market has been stable, Europe didn't evaporate.  I think you get an outlook, some on-guard language, ready to act if conditions warrant etc.  They generally only act if things are going in the shitter and right now they aren't.  New action would also run counter to the actions just taken by the Euro buddies.  They know each time they QE it has less impact - I wouldn't want to exhaust its effect then have to pull it out later and have the market not react

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  147. Looks like the RSI(14) went below 30 at the 1227 (also 38.2 retrace of the 1158-1267) level therefore would suspect that correction is complete if the market continues the rally.  Looking for a significant market top once the $vix:$tnx CLOSES below the lower Bollinger (20,2) band.  This did not happen at the end of Oct high.

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  148. WOW.  He retraced the entire intraday move, but held the gap.  daytrading is becoming a dying art.  Futures are the only way to play this market!!

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  149. also, if i help my sso trade from this morning i would have closed out with a decent gain.  sigh.

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  150. Had a buy limit at 1221 on esh12.  Missed it by like a half point and then took off.  Thought the 3pm rally on nothing might arrive and sure enough it didn't disappoint, I just missed it by a  hair.  Oh well, tomorrow's another day.

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  151. Yeah but you can't think like that.  The real mis-step was trying to buy too early, not stopping yourself out.  I made the mistake of covering my ES short way too early this morning too, but didn't compound by re-shorting in the 1230s, and its good I didn't because if I wasn't nimble I probably would have either gotten stopped out or be slightly underwater on that now.  And I moved onto other trades which turned out to be good (covered some puts and tna shorts near LOD).

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  152. Seemed to me like it alot of people weren't buying the fact that this would be the start of a larger sell-off.  Now whether that means that we're not selling off, or it means that people haven't really even begun to get the sell-off started, remains to be seen.  I'm starting to favor the ST bullish scenario.

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  153. I am also starting to lean toward the Santa rally/bullish EW scenario.  Net short, but mostly cash after today.

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  154. B.O.B - just outa curiousity, why do you short TNA rather than using TZA?

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  155. Because its a position I'm holding and trading around medium-term.  In volatile markets like this one, these leveraged products will 'decay' due to daily rebalancing.  Therefore since I'm holding a core position for the IT (I've been short at least some shares of tna continuously since mid-Oct.) I want the decay to work for me, rather than against me.  Thurs. I sold about half the position, Friday I bought it all back, and today I sold about half the position again.
     
    Its tricky though, because these shares can be hard to borrow.  Near the close I tried to short some shares again and was unable to because OX had none available.  There was a lot of selling pressure on that today.  I probably could have shorted tza today though.  Of course if we're up tomorrow it'll be reversed where tza is hard to short and tna is available.  That's why this type of trading is a little contrarian and you have to be willing to short tna on big up moves and often endure some drawdowns (and vice-versa for tza).

    One strategy for volatile markets is to short equal $ amounts of both and just profit from the decay, but in steady/trending markets this is actually a losing strategy.

    You can google 'leveraged etf rebalancing' or something like that for more analytical treatments of the way these instruments work.

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  156. This is so far just a 'reaction to Europe' not a meltdown and panic. A few more dominoes will need to fall, but they aren't going to all at once. This is just one of the first. Ben not stepping in with his printing press tomorrow will be another. Multiple reductions in earnings guidance will be another. More failed bond auctions and rising yields will be still another. For the waterfall to unfold, the moment of recognition doesn't happen at the top. It's when you're already over the ledge and the public figures out that the only direction available is down. We're just not quite there yet.

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  157. We had a Hindenburg Omen today - perhaps it will invite the violent wave 3 decline soon...

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  158. And yet again ANON20, the poster child for the detrimental effects of an interventionist U.S. foreign policy survives another day on this alien, petri dish planet to regurgitate more BLAH from the depths of Dante’s Inferno.

    Actually, your 90% figure is way off, it’s more like 99.5% (that’s 995 out of 1,000 in case the decimal place throws you off). And if you haven’t noticed by now, many of those 5 out of 1,000 contribute here regularly. So while I thoroughly enjoy your "stating the obvious, we also get it fool" rants, look in the mirror, because you too are a suckling, little pig on the tit of the same system you rail against. So while you A20, continue to suckle on every downward move of the market, in the hopes of one day having enough money to leave Mommy’s basement, in the ruins of a former US airstrip, and move to a developed country-    I will roam like a wild boar in the great South of the U.S. loaded with gold, ammo, property and hell maybe even some USD (although Confederate $ is my fiat currency of choice). And when you A20 have sold the last piece of your grandmother’s costume jewelry, and when the government of your country can no longer afford to provide free-internet for you to post here from your pin-up, KY infested bathroom, because the US cut-off foreign aid - that’s when I shall emerge from the swamps of the depths of Redneckdom to feast on suckling pig and thank God for all the wonderful blessings of a bountiful harvest!

    So from henceforth this day, you shall no longer be A20, but Chaz!
    "Hey MA - the meatloaf - NOW!!!!"

    http://www.youtube.com/watch?v=ID8B1Vn3YWg

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  159. Many thanks to Chris P. for donating and showing support for this community.  This will be increasingly important, since my Adsense account was just disabled for some unknown "policy violation."  :(

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  160. Also, I read on another site that there was massive call selling today by some fund managers who were trying to generate some income to 'catch up' in terms of performance.  This option selling presure reduced implied vols, thus keeping the vix down,

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  161. Forgot to mention that I do also trade tza.  Also I am trying to reduce cash market trading and go to futures so I don't miss all the overnight moves.

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  162. This suggests that said fund managers firmly believe that upside is strictly limited.

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  163. Thanks Brianhut, your insights are always meaningful.

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  164. The old Hindenburg again... wait for CNBC to mention it and then go long :).  (Not trading advice)

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  165. Many thanks to mav for his *3rd* donation!

    Thanks, mav!

    I replaced Adsense w/ another company, but I'm pretty sure the revenue is going to be about 5% of what it was.  This really sucks -- that was about 50% of the blog income, plus they're not going to pay me at all for last month.  :(

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  166. Looks like covering @ 1227.50 was a winner.  Now you know why I don't worry too much when it costs me a point and a half to cover at support before getting stopped back in. 

    Just went short again at 1238.25, since this has the potential look of an abc correction off the lows.  Keeping fairly tight stops though, just in case the bulls come to town and start breaking things.

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  167. What made you switch?

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  168. If I can be helpful, I'm glad. I get just as much from the insights, observations and analysis found here as any

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  169. Had no choice.  Google shut down my account for some undisclosed "policy violation."  That's really going to screw this up for me, unless donations pick up a whole bunch, or I can find some viable replacement.

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  170. Are you using Google+ ... maybe that's the root cause?

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  171. *Could* be an ending diagonal in process... maybe a last lunge up to about 1240 if so.  Otherwise, if there's no reversal from near these levels, then it's something else entirely.

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  172. undisclosed policy violation? how can you be sure not to repeat if they won't tell you what it was? sounds like a scam to me.

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  173. fwiw:  PL, Mercury retrograde cycles are tricky - they seem to coincide with decision points in TA and EW analysis, but it can take days to be clear unless they occur near other major planetary impacts.  
    If you wish to explore correlations, previous cycles in 2011 are:

    3/30 retrograde - direct 4/23   
    8/2 retrograde - direct 8/26  (Note the previously unscheduled FOMC mtg 8/1 and the following nested 3rd wave waterfall)
    11/24 retrograde - direct 12/13  (Reversal on 11/25) 

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  174. Basically something to do with "invalid clicks."  My best guess, based on the little bit of forensic tracking I can do, is that someone was showing up in the early morning hours and clicking ads repeatedly -- so maybe that was it. 

    I have no clue, and I have no control over it, since I can't even address any problems directly, since that's also a "policy violation."  Very frustrating, especially since they're keeping quite a bit of revenue from November to boot.  So I'm presently *and* retroactively being punished for something I have no control over.  Great system. 

    Guess I need to get to work finding my own advertisers.  Anybody in the financial business would be nuts NOT to want to advertise here -- it's an amazing audience with an obvious interest in the product, not to mention traders/investors generally have a reasonable degree of disposable income.

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  175. PL,

    Came across your blog from Yahoo! finance.  I've been a lurker for about 2 weeks just soaking in the knowledge with the hope that it is in fact possible to be on the right side of a trade as you and the other experienced traders here seem able to do.  Your analysis and commentary are both entertaining and very educational.   So far, I've not been able to leverage it to make a profit but once I do, I certainly plan on making a donation. 

    I'm one of those people that typically "lock-in" to a position for days to weeks, you've mentioned keeping that kind of paradigm in mind in the future and I would certainly apprecitate it if you could.  However, I also understand that the majority of your audience may be day-traders that are more nimble.  It would only be natural to emphasize that strategy.

    Count me in if you decide to go the subscription and/or registration route.  Although you do all this work for your own benefit, the fact that you post it openly for the rest of us to benefit from is rare indeed!  Your work, your ethics and your sense of humor speak volumes about who you are.

    Thank you,
    Whip_sawed

    P.S. The picture of your "backyard" was awesome.

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  176. How so on the ending diagonal?  I saw one count that had the whole b wave as a diagonal or triangle, which would assume a move back up to around 1240, then another marginal low (1220ish), then the bullish c wave to complete the double zigzag.  Is that what you mean, or do you mean on a smaller scale that this a-b-c 'b' wave might end with a c wave ED?  Hopefully, you understand what I am trying to convey - I sure made that sound confusing.

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  177. ty, Furrr.  I actually do find this stuff interesting, so I don't automatically discount it. 

    I do tend to be skeptical of people who randomly give "turn" dates which have no correlation to actual market levels (i.e.- a "low" can be halfway in the middle of a trend), and which have reversable polarity --- because there's no objective way to prove whether that's right or wrong, and there's no real way to use it for trading.

    However, believe it or not, I have found numerology to hold some interesting revelations.  I'm not very familiar w/ TRUE astrology (in other words, not the crap you see in the newspapers), but the fact that I don't know much about it doesn't mean I reflexively assume it's bunk. 

    I've found I learn a whole lot more about life when I take the approach of a student, and actually explore it with an open mind.  :)

    Always been a big fan of Shakespeare's quote:

    "There are more things in heaven and earth than are dreamt of in your philosophy."

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  178. Just talking about the tiny minute moves in the futures.  :)

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  179. Thx B.O.B, I figured it was something to that effect. I play in the cash markets and have used these often since '09.

    Sounds like you're doing what I had thought of doing back then after reviewing the charts, but didn't have the juevos to. These levered ETF's can be handy little devices, or WMD's if you have a bad day.

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  180. Pretzel - do you have a KO level for the alternate bullish count that confirms we are in 3 down? is it all the way down to the november lows?

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  181. Hey, I've been missing out on some of the fun due to the requirements of my 'real' job.  I work for a software company that sells portfolio accounting software to large HF's, and their servicers - Prime Brokers (GS, MS, UBS etc) and Fund Administrators (Fortis, UBS, HSBC, SEI, GSAM etc).  We have been getting questions about how the software can/will handle a 'redenomination' of the EUR since last week.  These are the really big players and they are seriously concerned about how their businesses will be able to process in the event some, say Greek, securities are redenominated from trading/settling in EUR to 'new drachmas'.  

    This doesn't mean it will happen, but it means big businesses are starting to plan for the eventuality, which means it's no longer a corner case scenario.  So the question is, how much of a probability of a EUR redenomination is the market pricing in at this point?  Ben needs to wait to fire the QE3 bullet until the US markets have moved from selling on what's going on in Europe, to just selling in panic b/c everyone else is selling, IMO.  Then it will have the potential to have some follow-through effects (at least until it inevitably ends).  

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  182. Thanks, Whipsawed, and welcome!

    But believe me when I say: this blog has more than doubled my workload and time investment (not to mention quadrupled my emotional investment, lol) over and above what was "normal" for me.  :)

    It's one thing to do something for yourself when you're a nimble trader who can "eye-ball" the charts -- it's entirely another when you feel responsible and accountable to an audience who may not be as nimble.  :) 

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  183. Pretty much, yep.  Hopefully I can find something else in the indicators to confirm/deny or at least add probability.

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  184. Yup, you can blow yourself up easily with these things and I've certainly taken losses on them.  Best advice would be to go with LT and IT trends, so 2009-2011 play long and May 2011-? play short.  Also take small positions.  If it goes with you, great, pick levels and take profits.  If it goes against you, use tight stops or average down, but ONLY IF you have more conviction - that's the benefit of small initial positions.  I shorted the Oct rally from 1200 -1292 (painfully), but eventually made my losses back and then some in Nov.  Drawdowns aren't fun things.

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  185. Agree about QE3 needing to be saved for later... btw, great report on the "inside the front line" stuff!

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  186. Hi Pretzel,

    Just wanted to say thanks.  I greatly enjoy your site and appreciate your expertise and insight.  I have been lurking for a few weeks.  I hope this sight is worth it for you and if not, you can find a way to make it so.  I made my first donation today and will be making a habit of it if I can manage to pull some more pork from this pig of a market.  

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  187. Many thanks, David!

    Your support of this community is greatly appreciated.  :)

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  188. thanks for sharing that william, great info about redenomination

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  189. Hey Everyone -

    I am a GastroTrader -I trade off what food people are eating and how they digest it.  Right now the bullish Bean Burrito cycle is nearing an end - pretty much running on fumes.  The next course is uncertain - we either have a sideways Spaghetti Bowl cycle or an Eat Sh*t and Die cycle coming up.

    I'll keep you posted

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  190. There's a huge bull market in peanuts/peanut butter.  No kidding.

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  191. Many thanks to Rob B. for his *3rd* donation!

    And many thanks to Thomas F. for his donation!

    I feel like I'm running a telethon today (not a bad thing) -- Save Our Blog!  (LOL -- that would be S.O.B.)

    My deepest heartfelt thanks to everyone who's donating, your support of this community means even more than usual today.  :)

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