Broken Markets

 I was actually beginning to believe we might be ready for a breakout attempt after seeing a very nce rally in teh morning, but there were a few clue that should have told me right away that we were headed for trouble. The Nasdaq, which had a very nice lead in the morning, reversed and started lagging badly about mid day. The Russell 2000, which was lagging in the morning, lagged even worse in the afternoon. And finally, after looking at this chart, it is pretty clear now that the 50dema is very strong resistance. Along with that, I will be willing to bet that tomorrow's FOMC decision was leaked today (I have pretty good reasons to believe that has happened in the past), resulting in a blizzard of selling by certain priviledged market participants. 

Oil, which had been showing signs of waking up, is now in trouble again. It has been severely under performing the SPX of late, and has broken a short up trend line. It looks like this isn;t going anywhere for a while. 

Gold continues to be range bound, but is about the last asset class still above the 50dma. It is showing signs of life here, with a MACD histogram that bottomed out yesterday, but still is probably at least a few weeks, if not months, form a breakout. 

The next two charts show how seriously broken these markets are. The yield on the 10 year treasury, even with stocks struggling, would never be this low woithout intervention from the Fed. What has it accomplished? Well, you can get a loan real cheap. If you can find a bank that will lend you money.

I don't think I have ever seen the U.S. Dollar index jumping around like this, although now that i have to chart ETFs rather than indexes (for those who don't know, stockharts.com no longer has candlestick charts available for the dollar index). It has now gotten above the 200dema twice, and that appears to be support for now. So far the equities market has been sort of ignoring this, but it won;t for long.

I got interrupted about an hour before the close, missing my chance to get the leading industry data, and worse, missing the sell off, which I did not see until after the close. Whether or not that means the FOMC is going to lay an egg tomorrow I don't know for sure, but I smell a rat here.

I will have the new highs update shortly.