MARKET INDEX TECHNICAL ANALYSIS - MITA Message Board

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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA

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To: Steve Lee who wrote (15154)	12/1/2002 4:04:29 PM
From: GraceZ	Read Replies (2) of 19219

Well, we have seen since then that things haven't improved as evidenced by the further rate cuts and the more recent comments from fed figures concerning monetisation of debt. Watch what the Fed does instead of what they say. In the last six months they've cut permanent creation from a monthly average of 6.5 billion per month in the year earlier period to a 3 billion per month rate down to zero as of October and November. Yes, they lower rates, but it has almost zero effect on the money supply considering that C&I loan demand has been falling for two years and is still falling. In a situation of falling loan demand cutting rates has little effect. Notice they've had to do several matched sales in the last month in order to keep rates from falling below their target. In light of their recent actions it makes that Bernanke speech and your accusations seem like idle talk. If the Fed was interesting in propping the economy they would be most certainly using their most potent tool which is the coupon pass, yet they've cut permanent creation to zero! As of September, the monetary aggregates are running at a 3.5% annualized growth coming down from the previous years 8.9% annualized growth. Monetary growth is flattening. You'd see that if you actually interested in investigating. and observing the futures and pre market action just below major support lines are big clues that the federal govt is intervening to keep the markets up. When you are looking for causes I can tell you that it's best to rule out horses before you start thinking zebras. When trading does it make sense to bet on support holding or breaking, resistance holding or breaking? When do you cover if you have profit, do you hang out waiting for that next level down while price hovers above support after a nice washout or do you let some other fool bet support will be taken out? Or do you double up your bets after support is broken? Do you think the big players make money holding while watching their short profits disappear or do they make money covering and going long at the inflection point that every bozo with a little TA under their belts can pick out on a chart? I can tell you that the big money doesn't hold a prejudice long or short and they have programs that are written specifically to exploit these support zones. Meanwhile the public traders are blaming it on the mythical PPT all the while their buy stops are getting taken out adding fuel to the fire. Duh! Everyone who thinks someone or some group is manipulating the market needs to take a good hard look at what it is that drives their own actions. It is these individual actions, everyone acting in their own selfish self interest that moves the market this way or that. What you have to learn if you are going to operate in the market successfully is that you're part of the mechanism that moves it, that no one group no matter what they attempt to do is capable of pushing it this way or that in any substantial sustained way.

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