For all the drama this week, the S&P 500 is almost exactly where we left off Friday at 4 PM.
Here is what we opined the outlook was in the weekly summary for the S&P 500 chart
And here is how it looks today, the S&P is a mere handful of points away from the close Friday.
Other than for daytrading folk there is nothing much to do here, we remain in the large purple range in between the 200 day moving average to the bottom and resistance above that both the 20 and 50 day moving averages created. There is no rush to hurry up and do something, just for the sake of show. Does one really want to make decisions that are affected by a Reuters headline from an anonymous European official... that 18 minutes later is disputed by another anonymous European official in an Associated Press story? Why bother having our capital affected by such nonsense - I'll go to Las Vegas if I'm so desperate for that sort of random "action".
Frankly, after the horrible selloff late Monday - if not for the stick save yesterday of Mr. Trichet getting on a plane in Australia 24 hours earlier than planned, and then a rushed communication that the Greeks must be saved (Spartans!!), this market looked ready to roll over yet again. The bulls have to be very thankful all world government's and central banks appear to be here to support them, no matter the long term cost to citizens.
Monday weak dollar / foreign / commodity stocks were trash. Yesterday they were king. The market continues to have no memory from day to day and is a hostage to the simplest of all relationships. After a 2 month respite in Nov/Dec 09 from the 1st grade level logic of "dollar down = everything goes up" (and vice versa) trading we had for much of 2008 and 2009, we are back at it - with bells on. (deep sigh) The intraday charts are laughable, you can basically track the dollar movement against the S&P 500 in almost perfect inverse correlation and it's back to making me tired of this whole casino. Individual fundamentals, company prospects, or metrics mean little - just tell me what the dollar will do in the next 90 minutes and I can trade the entire market en masse.
The name of the game has not changed - we are stuck in white noise. The "Fast Money" CNBC analysis only matters for daytraders since it's all about the dollar. What is said at 5 PM Wednesday night can be completely different Thursday at 9 AM based on what the US dollar does. Nothing else matters - which is a darn shame; I had hoped we had broken that relationship with the action in late 2009.
1046 on the floor, 1100 on the ceiling - everything else matters little. I continue to see very little to get excited about in individual charts from the long side - oversold bounces are all that are offered in 95% of cases. From a technical point of view those are short entry points, not longs. Tomorrow the EU will have a communication - where Greece will surely be discussed. I assume we can rally yet again on the same moral hazard news (if it's tomorrow or next week or whenever) and then the market will be left to its own devices. I am hoping it is sooner rather than later since I am having Greek fatigue.
Until then, it's hurry up and do nothing.
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