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Charts courtesy of stockcharts.com

Tuesday, May 14, 2013

Screaming Higher

Just when you thought the market was about to slow down, well, no it wasn't: it was merely a pause to catch a breath. It was back to the races today, and it seems now far more likely that 1665 is going to be hit, very likely withing the next couple of days. A big increase in volume certainly made the difference, and it looks like the big money is starting to buy again. The market has done almost nothing but go up for over 6 months now: it is certainly questionable how long that can continue, but one thing I think we can count on: it will last long enough to cause the bears to capitulate. By that time, there should be one hell of a bull trap set, and we will get little warning of it snapping shut.


Crude oil is not giving much of a clue?: this had been leading the market a bit earlier, but is making far bigger moves on a relative basis. Whether this pullback means we are due for a pullback in the market or not remains to be seen: I suspect not, as the market is currently fixated on the Yen,

Price the gold chart in Yen, and is would probably look a whole lot more bullish than this. This is more a testament to the strength of the Dollar than a loss in sentiment about gold. This pullback so far looks nominal, whe may get a move up if it bounces of the middle pivot point, but there is a ton of resistance still to get through.

Bond guru Bill Gross (the guy with the huge forehead) says was are on the cusp of a bear market in binds. Whether that triggered this move or not, I can't say, but it brings up two possibilities: Gross is right, or Gross is manipulating the market and is now buying the near panic selling.The second implies that he is a crook: since I have no proof of his criminal intentions, I have to assume the first.

Over the last few years, a move like this in the Dollar index would have triggered near panic selling in the stock market. Since it is the USD/JPY pair that is driving this rather than the EUR/USD pair, this time it really is different.

Just when I thought we might get a pause, or event the unthinkable, a slight pullback, the market went screaming higher. here is an old market saying, bull markets never let you in, and bear markets never let you out. For whatever reason (and I gave up trying to find reasons ages ago) we appear to be firmly in a bull market.

I will have the new highs update shortly.

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