My posting is late this evening, and therefore my missive will be short.
However, do not be fooled or rush off as the three chart exhibits below are worth far more than any words could describe. I have said it before and will say it again; the only trend truth is in the charts. Spot the trend and go with it.
Moreover, financial markets work by Science and Natural Law; not by what any man says will happen.
Be Very Careful or Get Out
Also, my current position is well known and clearly stated. If you need to question my current equity market viewpoint, go back and read some of my recent postings.
However in a nutshell, my position is that until a more realistic equity correction is allowed to happen the markets are extremely dangerous. My message would include that if you are long and cannot take on considerable risk and losses, use tight stops. If you are smart you should avoid exposure to the considerably overbought indices - as the risks are simply far too high.
Likewise, on the flip side, with zero interest rates and the fact that Bernanke has added so much liquidity recently, he, as one of the most powerful financial men in the world is attempting to melt the US stock market - up.
Essentially, this is also a hidden message to warn anyone who dares to short stocks or the index. Another stock market implosion is not what Mr. Bernanke wants right now. He sees the world, and particularly the USA in rose colored inflation glasses.
So currently, the only way to be short stocks at present is with a dangerous swing trade (since the trend is still up and has not reversed - yet). Again, this makes the equity markets even more precarious, given that Mr. Bernanke and his close friends on Wall Street appear to be intervening in the markets. Today's sharp gap up at the open of trading, was another clue that market intervention by the PPT is alive and well. Yet, if they keep this up much longer, investors may soon have to rename Wall Street to Fraud Street.
Ask When and Why an Opening GAP Should Occur?
Back in the old days when equity markets were actually honest, not manipulated by our governments, and it was a far more level playing field, it was extremely rare that one ever saw an opening gap in a stock. Now there are hundreds - daily.
Generally, in the past, in order for the pro, or market maker, to GAP a stock up at the open of trading in the morning, there had to be something very significant happening - over night.
After all, if there was no corporate news overnight that was of a material nature, and thus no significant news or order imbalance, by deliberately opening a stock higher than the previous closing price, the pro could technically carry out and cause an act of illicit stock market manipulation.
Below, is a brief sample of the exact legal words used by one Canadian Securities Regulator (BCSC) regarding this manipulative act. The words used by the SEC, or any other regulatory authority should not be substantially different, assuming of course that the spirit and intent of the Rule of Law - for all - is being upheld.
By the way, this is not a unique problem in the USA, as these legal words and equivalent acts of manipulation are equally laughable in Canada, whereby when it comes to white-collar stock market crime and stock manipulation, Canadian regulation and enforcement are for all intensive purposes, non-existent.
Manipulation and Fraud
A person must not, directly or indirectly, engage in or participate in conduct relating to securities or exchange contracts if the person knows, or reasonably should know, that the conduct
(a) results in or contributes to a misleading appearance of trading activity in, or an artificial price for, a security or exchange contract, or (b) perpetrates a fraud on any person.
Yet, today at the opening of trading there were a huge number of US stocks, including many of those in the SP 500 Index - that gapped sharply higher - all on no overnight material news. Equally, there was absolutely no proof or any evidence that there was so much demand that a huge order imbalance existed to justify the opening gaps. In fact, trading volume today in most stocks was well below normal.
If stocks are thus deliberately allowed to gap up at the open of trading, without overnight news of a material nature, and without any order imbalance - than technically, it could constitute an intentional act of stock market manipulation - which essentially as a result - could perpetrate a fraud on society, and especially all those whom invest and believe markets are freely and fairly traded.
Now imagine, what would it could say or imply, if that same fraud and manipulation was in fact being carried out or conducted by a fiduciary body - who was charged to oversee and protect the general public?
The logical conclusion is yours to choose. Possibly write to your local politician and demand a truthful answer that begins with auditing the large trades at investment bankers.
Chart Truth - Spot The Trend
Stock Market Challenge - Are you a Market Wizard?
1. Astro-Sky Traders (Gann Astrology) - One of the most famous days in stock market history, was on October 19, 1987 when the stock market crashed. Is there any similarity in the Astro-Sky between October 19, 1987, and next Monday December 13, 2010. If so what is the similarity?
2. Market Geometry Traders - The Gann Box shown on the last chart today (SP 500 Index daily) suggests a near completion. Given the SP 500 Index April 26, 2010 high was about 225 days ago (time); what is the significance now, of a market move of (about) 225 SP 500 Index points (price) down, and essentially, then back up again in (about) 225 days?
Please note that there will be no formal answers given on our blog. However, it would be a nice idea to share your thoughts with each other via comments.
James Kelly Sr.,
Editor in Chief, BBTL Blog
www.KRTT.com
www.Facebook.com/KRTTcom
www.twitter.com/KRTTcom
No comments:
Post a Comment