S&P500 Daily -

[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’ve spent quite some time discussing Yellen’s influence on the markets (notice how we avoided the word economy).  Without government interference, the markets lead the economy by about 3 months – think earnings and guidance.  When Yellen screwed around with liquidity, she managed to push markets up and do next to nothing for the economy.  In short, the Fed was creating a fraud – markets are good, so economy is good – and that’s supposed to keep social mood buoyant which aids politicians in getting re-elected.  The global economy is a mess and accelerating toward deflation. After the November 4th mid-terms, we expect markets to accelerate downward moreso than they will leading up to the 4th.

Click on chart to enlarge S&P500 Daily Closes Flat As Yellen Cuts Off POMO – For Now – Expect Sell Off Tomorrow

S&P500 Daily -

[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.]

As you may have noticed, Yellen has been the subject of recent comments.  Yellen is responsible for POMO – the six year running process to elevate markets higher which in turn elevates mood (through the constant MSM pump that all is good economically).  Well this SHOULD have ended today – but it didn’t.  The Fed’s interest income from bond purchases is another of Yellen’s stupid games to keep markets up for the November 5th mid-term elections.   This never ending up market should stay up until possibly this Thursday, or November 6th.  Our forecasts constantly change because it is very difficult to read the mind of one person who pushes a button to drive more liquidity into an already bloated market to mask a failing global economy.  We should be done with POMO and RRP (Reverse REPO or just REPO), but interest income from bond purchases is today’s wildcard along with the continuing share buyback gong show (corporate bond defaults pending).

Click on chart to enlarge S&P500 Daily Falls At The Open And Climbs Back To Close Flat – Yellen Bloviates On Wednesday

S&P500 Daily -

[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.]

Not much in the way of warning from a technical analysis perspective.  Volume is fading fast as expected.  Yellen speaks on the 29th and since we expect a green backdrop, we could see a pull back early next week, but nothing substantial until after Yellen unloads.  After Yellen stops talking we could see markets find more all time highs on nothing.  Only then may we well see a roll over.  Since Obama’s mid terms and re-election has timed itself nicely with  up markets, we may only see a roll over of markets after November the 5th.  Six years of Fed and government interference in markets to fool the herd into believing that the economy is fine – of course it is not.  When these markets normalize, and they will, Yellen and Obama will go down in history as the engineers of this global economic disaster.  Will Yellen extend POMO?  Only she knows – as unpredictable as she has become.  And this one 10 minute diatribe will likely determine whether markets close the year red or green.

Click on chart to enlarge S&P500 Daily Plays Blast Off – Moves Up 145 Points In Eight Days – Good Job Yellen – But What About The Tanking Global Economy

S&P500 Daily -

[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.]

Up at the open tomorrow, stall around 11a and roll over by noon.  Yellen is also using proceeds from previous bond purchases to jack the markets – jacking the markets, that is what you call it, isn’t it Yellen?  October 28 is the last shot of POMO – for now. Interesting how the channel “throw overs” pair – one to the support side followed by one to the resistance side.  When markets trend lower, volatility increases and price swings increase.  Be mindful of this as moves lower get more aggressive – exit aggressively and avoid longs overnight.  Cycle brackets indicate more time will be devoted to the downside.

Click on chart to enlarge S&P500 Daily Stalls At Channel Support – Second Last POMO Blast Tomorrow – We Know How It Goes Yellen

S&P500 Daily -

[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.]

So markets are up today because the Fed head punched another $2B or so leveraged US dollars into markets.  In other words, Yellen the market maker was buying.  Yellen the market maker will be buying about the same tomorrow, but the effects should wear off, as per the typical daily POMO cycle, around noon EDT.  Another Yellen backed dump of POMO arrives on Thursday the 23rd.  This should be the second last POMO of October.  Speculation is percolating around a possible extension of POMO into November.  See hourly for details – expect markets to open up and roll over by early afternoon.  Many companies are reporting earnings, but this doesn’t matter (issue zirp bonds, buy back shares, jack EPS, adjust revenue targets, set guidance high and roll back later – lather, rinse, repeat).   Follow Yellen’s POMO and you have all you need – Yellen does the buying until the POMO runs out.

Click on chart to enlarge S&P500 Daily Up About 1% On Day One Of Three Day POMO Week – More POMO Tomorrow
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