Don, thanks for the overview of your technicals...i'd like to draw some attention to this:
decisionpoint.com
bloomberg.com
it seems judging from these data and reports that the recent weakness in the bond market has not contributed much to increase bearishness. once again, it's a case of much bearish commentary but no bearish positioning by market participants. it seems that the bond futures contract is getting ready to drop to new lows:
tfc-charts.w2d.com
gold meanwhile looks constructive:
tfc-charts.w2d.com
rumor has it that Goldman Sachs was busy buying call options on gold - whether for clients or their own account wasn't clear. at the same time, a GS representative was trying to talk gold down on CNBC Europe. in fact, rumors w/regards to gold currently abound. one of the more interesting ones was that some shorts, declaring force majeure, refused to deliver. another one claimed that all the short covering that has supposedly taken place still leaves a majority of speculative accounts short at this time. it will be interesting to see how this plays out, but no doubt a lot of systemic stress has been built up. the Yen carry trade, the gold carry trade, interest rate swap related derivatives, have all blown up spectacularly. the next on the list are carry trades involving the Euro and the Swiss Franc. apparently the ECB is getting ready to raise rates on it's Thursday meeting - at least that's what the markets now expect in the wake of the strong NAPM numbers out of Germany, France and Italy last week and a flurry of hawkish comments from ECB officials.
therefore, a close eye should be kept on all these markets...if they continue in the direction they have recently embarked upon, i believe stocks will continue to have problems regardless of the FOMC decision on Tuesday (which is anyway already known: no change in rates and probably no change in bias...priced in already?).
regards,
hb |
