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The Problem With Nominal Charts...

|Includes: DIA, Aberdeen Asia-Pacific Income Fund (FAX), HYG, JNK, LQD, QQQ, SPY, TEI

So many TA's look at a nominal chart and try to derive conclusions for that market, stock, commodity or what have you.

That's fine, especially for day traders. But the market is a concert; a massive orchestra playing a multitude of rhythms, sometimes in harmony and at other times in a terrible cacophony.

The only way to calm the noise is to look under the hood; to see what is going on in disparate assets and indicators and then cross reference into a theme.

As an example, this summer's bearish flavor - complete with ginned up T Bond bullishness and deflationary implications - has been negatively diverged every step of the way by this junk bond fund and the emerging market bond funds, all of which usually suffer major damage during actual - as opposed to trumped up - liquidity events.

But people don't want to hear the subtleties, they want to know bullish or bearish? This is not a market for linear thinking. It's Wonderland, and it is a challenge for everybody. While I have felt July could be problematic (check), the bullish intermediate theme has been kept intact due to 'under the hood' signals that refused to confirm the fear mongers.

The moment that changes, I'll change. But here's the thing, the US dollar's over bought, T Bonds are over owned and the port side of the boat is listing in my opinion.

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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.