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Quote of the day: "The Crucial question for any policy is not what are its intention - but what are its effects?" Walter E. Williams
By Dr. John L. Faessel
ON THE MARKET
Commentary and Insights
Dr.Faessel@onthemar.com
Wednesday - June 3, 2009
One more time; a most effective way to play the crashing US Dollar is the US DOLLAR BEARISH FUND ETF (UDN) $27.23. And it's a great hedging tool to counter the destruction of what was once the de facto currency of the planet as we slide into Marxism.
Get this one; Beijing students laughed when US Treasury Secretary Timothy Geithner told them China's huge dollar-based holdings ($1.1TRILION) are safe. Oh yeah- sure Timmy… And don't forget to tell ‘em the moon is made of green cheese.
Narrow Range postings in McClellan hints of a big move
Yesterday's McClellan Oscillator registered a plus (and slightly overbought) 109 after Mondays plus and somewhat overbought 105. Volume fell and was below average.
These consecutive "narrow range" posts of 109 and 105 in McClellan postings meet the requirements of a Narrow Range configuration that in McC Oscillator lore has historically foretold big market moves of 2% to 3 %. These moves are generally in the direction of the recent short term trend, i.e. that's up.
Trade continues to be constructive and there is not really any distribution. Shorts have to truly be on edge as we approach the last bastions of "local" resistance and a humongous trading void (clear sailing) is just a few points away up-top. And with "plenty of room" to get into the high overbought zone the possibility looms that a HUGE high % move could be brewing. This market doesn't seem to want to go down.
Another observation; as the market has slid sideways in a trading range over the last couple of weeks the McClellan was also locked in a generally neutral range. Meaning; that the huge move off the lows was being digested in a good orderly fashion. If you recall there was not more than a two day pullback from S&P 500 (SPX) 666 to 930.
The technical picture now shows price support in the S&P 500 (SPX) is at 940, 920, 880 and then 871. 200-day moving average support is at (SPX) 925. The 50-day moving average support is now at S&P 500 (SPX) 868.
(SPX) short term resistance is at 950.
The abject terror of a couple of months ago is all but a memory, at present its trepidation and worry, but at the low end of the cycle's postings. Yesterday's CBOE Total Exchange Put / Call Ratio was a 0.82 and the (VIX) (FEAR INDEX) had a low tick of 28.30. The low of the cycle of 26.57 was made two weeks ago today (Wednesday) and was the lowest posting since mid September 2008.
Yesterday the yield on the Treasury 10-year fell 7 basis points to 3.63%.
Dr. John L. Faessel: Dr.Faessel@onthemar.com
Published at Investorideas.com Financial Article Feed : http://www.investorideas.com/RSS/feeds/II-Art.xml
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