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Playing the Ponzi
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Why “Playing the Ponzi”? I view the entire monetary and financial system as something of a Ponzi scheme. Starting with currency that is created as debt, and running straight through a global economic model that is based on infinite growth in a finite world. This won’t end well. I’d go a step... More
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Playing the Ponzi
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  • Where is S&P resistance

    We have seen a lot of volatility in recent weeks.  I remain of the belief that we have formed a major top, and the next leg (longer term) is likely down.  That said, in the short term, it seems that there's a pretty good chance we bounce.  One of my favorite market technicians, Chris Kimble, has been noting the extreme bearishness.  The bond market is absolutely rejecting the likelihood of an economic recovery, in my opinion.  That said, the equity markets love hope, and they sure hope for some QE3, despite the fact that QE1 and QE2 have done nothing to help the real economy.  Looking at the chart, there is plenty of room to bounce before the bulls would have any cause for chartological excitement.

    As noted in the chart above, 1220 has shown itself to be pretty strong support.  So where could we rally to?  1160 or so is a downtrending line of resistance.  If we can't get past 1160, that would bode pretty poorly for the near term performance of stocks, imho.  A rally to 1210 or so gets us back to recent high.  If we top out there, then we have formed something of achannel, and should consider the possibility that we'll be rangebound between 1120 and 1210 for little awhile.  A rally to 1260 or so would get us back to the "critical support" that broke so precipitously a few weeks ago.  I will look to get net short there, if given the opportunity.

    Aug 23 1:37 PM | Link | Comment!
  • JAG looks interesting

    Gold has run like mad, and seems to be either at a blow-off top or starting a new, even more accelerated run.  I don't know.  But the miners of gold have, in general, lagged.  By quite a bit.  One favorite from a few years ago that has continued to post growing revenues while its stock got beaten senseless is Jaguar Mining (JAG).  Well, JAG may finally be turning the corner.  The stock price looks to be breaking out from the downtrend (a falling bullish wedge) that's dogged it for over a year now.

    There is plenty of resistance to be found on the way back up, but breaking the old resistance trendline is the first step in establishing a new uptrend.

    Aug 21 11:40 PM | Link | Comment!
  • 30 year Treasury revisits 2007 highs

    Wow, talk about a disconnect between the stock and bond market - the 30 US Treasury is revisiting its highs of 2008, while the S&P index still sits about 40% above its 2009 lows.  Typically, the Treasury bond market and equity market trade in a matching, inversely correlative relationship.  Without question, the market is pricing in an Armegaddon that the stock market is not.  Which market is panicked and which is not?  That one's rhetorical.  Which one is right?  That one's not.  Below is a chart of the 30 year Treasury futures contract.

    I feel pretty confident that one is far off the market and will be adjusting very abruptly before too long.

    Aug 21 11:26 PM | Link | Comment!
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