Thursday, August 21, 2014

Charts whatever, let's hit that top trendline one more time

The markets have backed the Fed into this corner where no partial withdrawal is possible.  Each attempt to warn of tapering or policy moderation was met by a drop, then concessions, then insane rally and a new wave of liquidity expectations.

So the Fed has no choice now but to pull the band-aid off in September.  If equities go no-bid this fall, so be it.  Everyone was warned.

Upper trendlines get us close to 2020 next week.  There is the holiday weekend.  Will be interesting to see if we top just before it as players take a defensive stance.  Weekly Bollingers on the SPX are up there ...

Good news!  The NPS has decided to save the chalet in Enchanted Valley for now.  I visited the site back in January, when the tone was very different and it sure felt like they were going to let the river take it.

Even if they move the structure to another site in the valley, the NPS will likely have to shore up the bank with riprap to protect the new location.  This violates the idea of wilderness and letting Nature's God sort this all out, a significant shift in thinking from the Park Service.

SPX going no-bid after September FOMC


Christian Gustafson said...

We have the next take on Q2 GDP late next week as well, which could be interesting. Another hot print on this may leave no cover for the Fed to continue its ridiculous liquidity policies.

Permabear Doomster said...

Well, that is one hell of a down channel.

Clearly, we're headed higher into..and slightly past Labor day.

Sp'2020s at least..
maybe as high as 2030/50

Thing is...just how the hell are we going to fall to 1600s.. never mind 1000?

Even I'm having doubts about the 1750/00 by Nov/Dec.

I would agree on the 'no bid' issue. Liquidity gets lower every if it does break.. it'll be a major issue.

Crazy times....won't be many shorts to stop out once sp'2000s.

Christian Gustafson said...

Yah, there's no question that my chart is a worst-case scenario, outside of a comet strike or some such.

But what do we have to work with here?

We have some support "areas" and lines on a chart.

We have tenuous logical models like 3PDH or Elliott wavy gravy analysis, moonbeams, long cycles, turn dates, horoscopes, chicken bones, tea leaves, and the rest.

We have the fact of "the bubble" and the knowledge of the players of the overall buildup.

We know that 2008 was more steep and scary than the prior cycle off the 2000 highs.

We have economic "fundamentals".

We have all of these millenarian end-times events going on all at once, plagues, resource depletion, debt-saturation, ominous demographics, revolutions, tension among the nuclear powers.

So my chart crap may be a base worst-case for the first leg down, for what "no-bid" may mean in the days ahead.

Good luck to allll ....

Bicycle said...

2008 broke trend on the quarterlies, what if this is just a big kissback to the trend from the 1987 pin low?

Permabear Doomster said...

re: So my chart crap

I'm kinda still bemused you don't sometimes just be more open to more crazy upside.

Armstrong today was again touting the sp'3000s. That'd make for a much more natural grand top...before this madness peaks.
ps. why not install Disqus?

T.Berry said...

doomster---under yellen s&p will hit 3k at some point given she serves 2 terms (no reason she should'nt since s&p's up almost 15% in her first 5 months). low prob it prints sub 1,800 ever again. 2k is here, now can we see 2,200 by eoy? many more "tops" go down. lots of air above.

T.Berry said...

meant 2,100 by year end 2014 not 2,200. 2,200 gets hit next year towards 2,400++++