Dow Jones Weekly -

[Technical Indicators We Use – MACD, MACD Histogram, Bollinger Bands, Candlestick Patterns, Elliott Wave Counts, Cycle Brackets, Volume, Channel Support and Channel Resistance, Support and Resistance Levels.]

Interesting as to what happens when HFTs are shut off.  Thanks ICE.  Next week could be a meltdown - could take us to 16000 or less.  It's not a linear trip - expect lots of wild swings and lots of opportunities to short rallies.  Realty coming soon - it won't be pretty.

Click on chart to enlarge Dow Jones Weekly Down Almost 3% – Closes Near Support – More Downside Next Week

Dow Jones Weekly -

[Technical Indicators We Use – MACD, MACD Histogram, Bollinger Bands, Candlestick Patterns, Elliott Wave Counts, Cycle Brackets, Volume, Channel Support and Channel Resistance, Support and Resistance Levels.]

If nothing else, this earnings season has proven one thing - company earnings and revenue are nearly irrelevant to share price - nearly, but not entirely.  Once again, big government continues to work with central banks to blow billions per day to keep stock markets up - for the masses who still think big government is good, this must be very confusing.  The big US banks all reported lousy and their stocks fell.  Magically, they have all recovered.  We continue to believe that the end to HFTs on ICE run exchanges on January 14 (includes the NYSE) has put an end any chance of more all time highs.  Divergence in the MACD and its turn down helps to confirm this.  We need a close below 17100.

Click on chart to enlarge Dow Jones Weekly Reverses Up On Low Volume – Central Banks And Big Government Continue To Mortgage The Future To Keep Stock Markets Up

Dow Jones Weekly -

[Technical Indicators We Use – MACD, MACD Histogram, Bollinger Bands, Candlestick Patterns, Elliott Wave Counts, Cycle Brackets, Volume, Channel Support and Channel Resistance, Support and Resistance Levels.]

We expect to see more of the same next week - 17050 may act as support, but we suspect 17050 will not hold up by the end of next week.  Earnings season is yet another gong show of accounting tricks and buy backs with mix results at best.  15850 is the support we need to close below before considering this down trend to be serious.  HFTs remain shut off, so the Fed is buying each move at the same speed as the rest of us.

Deflation continues to accelerate and central bankers just can't seem to shut up during market hours - not Yellen, but Bullard this time threatening more QE - with the US debt at 18.3T this would get interesting.  More debt to keep markets up while the global economy continues contracting - like polishing portholes on the Titanic after the iceberg incident.

Click on chart to enlarge Dow Jones Weekly Closes Down As HFT Shutdown And Shrinking Economy Takes Us On A Road To Reality

Dow Jones Weekly -

[Technical Indicators We Use – MACD, MACD Histogram, Bollinger Bands, Candlestick Patterns, Elliott Wave Counts, Cycle Brackets, Volume, Channel Support and Channel Resistance, Support and Resistance Levels.]

The CME altered it's high frequency trading (HFT) rules back in September 2014 - .  ICE (owns the NYSE) will be effectively banning HFT abuse next week - January 14.  This should mean that January 13 is a good day to load up on shorts, but you may want to wait for a confirmation.  The Federal Reserve, US Government and certain financial institutions have used HFT to "leap" the market higher in the face of a decline since March 2009, perhaps earlier.  The net effect is that the financial institutions get their profits, the Fed gets their justification to exist and the US Government's tool for social mood, US indexes, continues higher to keep voters in the mood to re-elect incumbents.  This should all end next week - that markets have made it this high is a joke.  Here's the notice from ICE delivered on December 29, 2014.

Click on chart to enlarge Dow Jones Weekly Closes Down Leaving Behind A Huge Lower Shadow – January 14 Should Change This

Dow Jones Weekly -

[Technical Indicators We Use – MACD, MACD Histogram, Bollinger Bands, Candlestick Patterns, Elliott Wave Counts, Cycle Brackets, Volume, Channel Support and Channel Resistance, Support and Resistance Levels.]

US Government debt just hit $18.14 TRILLION this week - kind of makes it difficult to swallow.  All in the name of keeping interest rates down and stock markets up - kind of makes it difficult not to vomit.  So it comes down to this folks - markets go higher because Yellen keeps buying up all that moves or central banks finally back off with their "QE forever" and we fall quickly.  It's a guessing game.  No more.  No less.   The MSM continues to report higher markets on the backs of much higher P/E's.  What these "narrative pushers" fail to disclose is the amount of share buy backs and accounting gimmicks that have used to create such P/E's.  Oops.

Momentum remains stalled.  Earnings season starts on the 12th of January.  Hats off to the CFO's if they can mask their Q4 results and makes things go up even higher.  Expect to see a bounce on Monday, perhaps into Tuesday.  After this bounce, markets should move down sharply.

Click on chart to enlarge Dow Jones Weekly Pulls Back Again – Central Banks Pulling Back We Think – Hope
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