Don’t forget that tomorrow’s tax day. Found an appropriate video for that, a little old, but still appropriate. Love the lyrics. Listen to what Bush tells the reporter at the end of this video...
The Beatles – Taxman:
And now tax revenues are collapsing. I just read in the community newspaper that due to shortfalls the State of Washington is proposing a new 6% tax on Sewer and water bills! Love it. This is a great example of the real trickle down effect!
At any rate, what I described last night as a potential top and ending diagonal is still in play and looking reasonable, although the diagonal is yet unbroken.
Today the DOW finished off 137 points, the S&P was down 2%, the NDX lost 1.1%, and the RUT lost 3.2%.
Declining issues were slightly more than two to one down, and declining volume was 69% on the NYSE. The put/call ratio finished the day at .72. I’m not sure in this volatile a market if today’s decline satisfies the small movement on the McClelland Oscillator from yesterday, it’s marginal if it did. The VIX diverged from the down market by also being down slightly (.37%).
Intel reported after the bell, and yes, earning were better than forecast, but much smaller than last year and revenues were way down. Intel lost an entire dollar after the bell and dragged the Q’s down with it. That should anchor the market some in the morning.
Here’s a twenty day, 30 minute view of the SPX showing the ending diagonal in red. By the way, for those who watch Denninger’s video, he drew one in but did so on too small a time frame… I believe this to be the more accurate version. Note that the stochastic here is oversold, the 10 minute is in the middle, the 60 minute fast is oversold, and the daily/weekly is overbought:
The daily SPX shows a bearish reversal, but there’s a lot of support in the 825 to 835 area with the 100dma in there. It did get beneath the 848 pivot and the next lower is at 789, just about where the 50dma is now. Note how fast and high the bottom Bollinger has come up, already approaching 770. Way overbought on the daily stochastic:
The DOW daily is closer to its support line than the SPX and may break or bounce first. Note that today’s decline is on rising volume and is HIGHER than any volume of the last 3 weeks here. Volume was generally higher market wide:
The XLF is just bearish looking. After closing two consecutive days above the upper Bollinger, it closed well beneath it today. That is a sell signal. And the fact today opened down and closed below yesterday’s low makes this look like a dark cloud formation – a very bearish one if it’s confirmed by tomorrow’s action. Note the 100dma is just beneath $10, there’ll probably be some support there. Higher volume here today too:
Talk about bearish looking, IYR is nasty. Not only a dark cloud formation, but it closed beneath last Thursday’s candle body. Higher volume today than yesterday and the CMBX indices were all higher again today – no let up at all on those:
That’s about it, the SPX has not broken the bottom of that potential ending diagonal yet. How about that Martin Armstrong piece? Did you read the last paragraph and catch the names he dropped? These “club” members need to be shown the real club.
You know, I keep picturing Lloyd Blankfein, CEO of Goldman, as the commander of the Death Star in Star Wars. That would make Paulson Darth Vader of course. And today I learned who’s in charge of it all:
Oh, and it’s not really the Death Star, it’s the DEBT STAR:
Not to worry, tomorrow the Taxman commeth…
GEORGE HARRISON – TAXMAN (Eric Clapton guitar):