June 11, 2009 - It Will Take Really Bad News for the Market to Crash

Take a look at SPY, SPX, DIA, and QQQQ on this website. It provides the open interest put call ratios for each of these stocks/indexes.

Right now, the put/call ratio for SPY is 1.53, SPX is 1.37, DOW is 1.20, DIA is 1.21, NDX is 1.50, QQQQ is 0.98. Above 1.1, the market is bearish, below 0.90, the market is bullish, and between 0.90 and 1.1 the market is somewhat neutral. Right now, SPY and the DOW are bearish while QQQQ, the trading platform for NDX is neutral±. In a bearish market, the platform traders will go long as the put-call payout percentage is greater then with the long positions.

With comrade O in charge, he has likely given orders to keep the market going up using the PPT to provide confidence the government can pay for national health insurance, etc. He's got billions in TARP funds he can use for market manipulation and it doesn't take much.

In the past, the market was a casino with the platform traders trading bearish if market sentiment was bullish and vice versa. The PPT has thrown a monkey wrench into the mix by giving platform traders their marching orders to keep the market going up to support BHO's programs. Also, we are in a bearish sentiment market, so this helps keep the market going up. But if interest rates keep going up and some more real bad news comes out like the $US falls below 76 on forex, the market will crash regardless of the PPT and the platform traders.

As market sentiment is bearish and with the help of the PPT, the market will continue to go up until there's some type of crisis. Expect 1050 for SPX before a crash takes place. What I've found is, in a rising market, bad news is ignored and technical trading signals don't work for short traders; and conversely, bullish technical signals and any good news raises the market.

Wednesday, June 3, After Market Open

Brett Steenbarger has a good blog here to follow during the day. He provides insights into the market several times during the day as well as educational blogs. Might be worthwhile to check out.

The market has moved down, but seems to have entered trading range for the day. As Brett mentioned, it does seem odd the selling stopped when 932 was hit on the SPX - - a prior high before the latest breakout.

Tuesday PreMarket Open, June 2

The ‘jam job’ by the PPT in stocks at the close on Friday was designed to impress the Chinese and legitimize the government takeover of GM. We need to see how stocks finish today as there apears to be trouble brewing in the markets. If the S&P (SPX) closes below the 200-day exponential moving average at 943 (and dropping) on Tuesday, then closes below the 200-day simple moving average of 927 (and dropping) by the end of the week, then expect a great deal of trouble. If stocks continue to rally above these 200-day moving averages, then expect the SPX to move to 1,000 to 1,050 in coming weeks/months. These moving averages are vitally important in determining the direction of the market.

If this breakout is to be sustained, stocks need to stay above 93.22 for SPY from the May 8th high. In other words, any consolidation from here should be modest if a new up leg is beginning.

Do We Actually Have a Negative 15% GDP Growth Rate vs Negative 6%?

An interesting article from Ron Kirby. Ron says the Fed has either repatriated to other countries their gold held by us for custodial reasons, and/or sold gold in the past two years for an amount totalling 5,000 tonnes. Our gold inventory is offically listed at 8,100± tonnes. The dollar value of this exported tonnage was at current gold market values and was officially added to our export totals in what appears to be an obvious attempt to show the US financial condition is improving.

Ron concludes "The value of these bullion exports significantly “skew” the doctored U.S. Trade numbers [coincidentally, also prepared by the U.S. Census Bureau] in an attempt to convey a picture that the U.S. financial position is improving."

Mr. Kirby's article is as follows:

http://www.financialsense.com/fsu/editorials/kirby/2009/0529.html

Ron's article addresses pumping up our GDP using gold exports. But then there is the import side of the ledger. Robert F. Dieli, Ph.D., a longtime observer of Wall Street and the Economy, analyzed the first quarter 2009 real GDP and the impact of weaker imports on final GDP numbers. Mr. Dieli reports the following:

“As you know, imports are subtracted from GDP. Because imports are declining in absolute terms, you get a positive effect from a negative-negative. Just to be clear as to what this chart is telling us: the drop in imports contributed 6.05 percentage points to the GDP growth rate. What this means is that without the contribution from imports, GDP declined at 12.15% annual rate in Q1.

In other words, all of the domestic activity was, as the employment numbers suggested, in free fall! Now, this has some important implications for the profile of growth going forward. When imports stop dropping, and they likely will in the near future, the sign on this term will go back to its normal negative, and when it does, it will expose the true growth rate of the domestic economy. We had best hope that GPD has gotten back on track by the time the positive effect of negative import growth wears off.”

The bad news is that the trade balance shift from imports is actually bad for the economy and signifies extreme weakness yet it shows up as a positive contributor to GDP due to how the math works.

Robert's article is here:

http://www.ritholtz.com/blog/2009/05/weak-imports-goose-gdp/

http://www.nospinforecast.com/reports/gdpinq12009report.pdf

What this means is our government is using phony gold export numbers, which in actuality is likely repatriations of other countries' gold back to their country. Because if they were actual US gold sales, we would have virtually no gold left here in the US. The Census Bureaus then officially adds this $128 billion repatriation to our GDP. On the import side of the ledger, the government subtracts the 6.05% decline in imports and this amount is also added to our official GDP.

In other words, our economy has actually contracted far far more than has been let on.

Foreign Hitmen to Bring Down COMEX??

Great article by Jim Willie, Ph.D. Statistics. Jim is painting a picture of an all out economic war going on behind the scenes. I agree a breakdown of COMEX could be our financial system's archilles heal. By exposing COMEX corruption and allowing gold to float to new risk adversion highs, it would seriously devalue the US dollar. It would likely bring the American and British central banks to their knees and end their hegenomy.

I can understand Russia's motivation - - and if Jim's contention is true, they are more than likely than not to be the hitman, or one of them. But I have to wonder whether it's in China's best interest. Though China would be sacrificing some to much of the value of their US reserve holdings, they would gain reserve currency clout.

It could be China views the US dollar demise as inevitable; thus, they might want to control its demise on their own terms. By buying up COMEX contracts and demanding delivery, China would be exchanging their depreciating US reserve holdings with COMEX gold - - an appreciating asset. Given China's current economic status, we would likely have to make good on COMEX contract deliveries - - i.e., they would take our gold. But, if my calculations are correct, COMEX contracts would amount to at most tens of billions of dollars, which is no where near their trillion+ dollar reserve holdings. So China's motivation to gain economic power would come at the expense of their remainng US dollar reserve holdings, which outwardly doesn't appear to be a good tradeoff.

Other potential hitmen could include Iran, Syria, Saudi Arabia, Brazil, etc.

His article is here:

http://www.financialsense.com/fsu/editorials/willie/2009/0528.html

Here are several pertinent passages from his article:

-----------

Major dislocations are coming. Tremendous disruptions are coming. Price discontinuities are coming. Price chart patterns might be rendered useless soon. Last week, the case for a grand Paradigm Shift was made, covering many elements in order to paint a mosaic

....It has come to my attention that several private parties have accepted contract assignments to neuter the COMEX and London Metals Exchange, to render ruin to its gold market

....The COMEX in all likelihood is the weakest link in the US-UK chain of corrupted financial markets

....That is the lynchpin to control the USDollar, the USTreasurys, and the corrupt mechanisms used by the New York and London syndicates. Their clear criminal behavior is beyond the reach of law enforcement, but they are not beyond the reach of hitmen.

...The global creditors for the USTreasury Bonds are so angry at the past suffered losses, the prospect of deep future losses, and the corruption laced throughout the US financial system, that they have hired third parties to kill off the US$-gold platforms, to destroy the burdensome banking ballast dominated by protected entrenched fraud experts, to lay waste to the vehicles used by the US-UK bond trafficking syndicate totally saturated with corruption, dishonesty, and collusion, replete with greed, totally absent conscience. They have systemically been dismantling the COMEX pillars and levers over the last several months, quietly and without fanfare, surely without publicity. If gold investors knew of their actions, they would become much bolder. Some want the bankers in their gunsights not to be warned. They await their fate with the Financial Grim Reaper. Their executions will be as swift as brutal....The financial cartel dominated by the United States and United Kingdom is soon to suffer some serious blows

....Some might wonder what was the turning point that resulted in hired hitmen to be under contract against certain US financial markets. Some might say the failures of Lehman Brothers, American Intl Group, and Fannie Mae. Not so! In my opinion, it was the invasion in the South Osettia region of Georgia in August 2008. The events around Georgia, with the United States Military deeply involved, along with a certain tiny mischievous ally nation, lit a fuse that set off a chain of events. In time, events led to orders given by high level powers, for the US fraud kings on Wall Street to swallow the medicine no later than first thing Monday morning on September 15th.

...Sources from GATA (the Gold Anti-Trust Action committee) report growing distress for participants in the COMEX gold contracts, where a commercial party is very short and in deep trouble. They have sold more gold bullion than they can deliver. They are likely one of the big banks who violate the law with impunity, with USGovt sanctioned protection. By that is meant they routinely do not post 90% of the metal as collateral that they illegally sell. This is naked shorting by any other name. There are reports of grave concern over the upcoming June gold option expiration.

...The important loaded monthly contracts are March, June, September, and December. The COMEX has tried to limit the ability of buyers to take delivery, running them around in circles, and entangling them in red tape, all clearly restraint of trade endorsed by the USGovt. Such rules are not in effect for cotton or soybeans or crude oil or pork bellies. After all, a financial crime syndicate has taken control of the USGovt, ever since Robert Rubin took charge at the USDept Treasury in 1992.

...Background inventory strain has come from unexpected sources. The Germans have demanded that gold bullion held in US custodial accounts be returned to their owners, with physical gold shipped back to Germany. The Dubai bankers have demanded that gold bullion held in London custodial accounts be returned to their owners, with physical gold shipped back to the United Arab Emirates. They are following the hired German counsel. In all likelihood, neither US nor London sources are in possession of all the gold held in those custodial accounts, since at least some of it probably was improperly leased. By that is meant without owner permission or knowledge. So an uproar could come soon with charges of gold bullion theft, or at least failure of fiduciary responsibility. Theft is a simpler description.

...China is the biggest gold producer in the world now, but none of its output is directed to the open market. Russia is a significant gold producer also, but none of its output is directed to the open market either. A near default occurred in early April from a close call to Deutsche Bank on 850 thousand ounces of gold. The tarnished bankers at D-Bank dug up over a million ounces on the quick from the ready Euro Central Bank mine shifts in the nick of time. Never ignore the basic fact that COMEX lies through its teeth about the gold bullion in its vaults, since audits do not occur, some is leased (replaced by paper certificates), and some is committed in some fashion to very wealthy parties (unavailable). Far less gold bullion rests in COMEX vaults than is advertised. All signals point to serious strain in COMEX gold supply.

...The Chinese have proceeded with a transition to yuan-based domestic banking, with an installation of yuan swap facilities around the world, with an ASEAN regional fund again supplied by yuan for flexible purposes, with permission granted to two Hong Kong banks to sell yuan-based bonds, with an admitted rise in significant gold bullion reserves, and with continued verbal battles over legitimacy of the USDollar as the global reserve currency. These Chinese initiatives in recent weeks, occurring rapidly, are serving as a collective extreme event with the potential for profound disruption. A gold-backed yuan currency would surely cause massive disruption in a climax merger of events. The barter system set up between Russia and Europe will bypass the US$-based settlement system, as will the barter system set up between Russia and China. The avoidance of contract settlement in USDollars would result in extreme disruption to the global banking system. The creditor nations are plotting to organize and launch alternative currencies, maybe to fortify existing currencies (like the euro or yuan or ruble) with a gold component, maybe also with a crude oil component. A challenge to the USDollar by asset-backed currencies would result in extreme disruption to the global banking system. The hidden nitroglycerine to the disruptions is the Russian military, and any pledges of support for nations attempted to force systemic changes. These are just some important examples of change agents.

...NOW FACTOR IN DISRUPTIVE EVENTS, THE PRICE DISLOCATIONS, AND THE OVER-ARCHING PARADIGM SHIFT IN PROGRESS. THE GOLD PRICE COULD REACH 1300 SUDDENLY. WITH EXTREME CONTROVERSY FROM COMEX, LIKE DELIVERY DEFAULTS, PUBLICIZED CORRUPTION, AND EVEN FRAUD INDICTMENTS, THE GOLD PRICE COULD OVER-RUN THE 1300 TARGET AND HEAD FOR 1500 AND BEYOND. SILVER COULD AS A RESULT FOLLOW ITS WARRIOR BROTHER, HEAD PAST 20 IN A FLASH, AND PURSUE 30 EASILY.

-------------

Thursday, May 21, After Market Close

We got a solid down day today (Thursday). After reading much analysis, the market will be on its way down shortly. The 30 and 15-min stochastics suggest the market should rise tomorrow, so this should be a good entry point to go short when the SPX hits 900 to 920. Tomorrow's, and maybe Monday's bounce should require three small waves beginning with an initial upleg, then a partial down leg, then the final upleg to 900-920 before the market begins it's big correction.

If by some chance the SPX breaks above 930.17, then all bets are off. This would signal a continuation of the March 6 rally, but I consider this highly unlikely. There's just too much bad news drip, drip, dripping out there every day... and with earnings announcment season pretty much nearing an end, there's not much left to keep the market in an upward trend.

Current predictions appear to suggest a correction to about 7500 for the DOW and 800-820 for the S&P.

There was a lot of chatter in the financial news media today with a veiled admittance by Geithner that the PPT spiked the recent rally to support banks for their stock offerings. Gosh, who would have guessed they would do something like that?

Appears we're also having problems on the US dollar and Treasury bond fronts. The dollar keeps plunging, which is not a good thing and there might not be a lot the Fed and Treasury can do about it - - except let the stock market fall. Also, word just came out some foreign central banks have been selling into the Treasury bond auctions with one bank selling a large position of 5-yr notes. Other offers too are coming in from Asian real money longs using higher coupons -- also looking to sell size without unduly upsetting the market; especially considering the illiquidity in off-the-run bids from the Street. This spells big trouble for the US dollar and the bond market. We could be seeing higher interest rates real soon and a potential financial panic not too far in the future. The Fed's have a big auction next week - - let's see what happens.

Could be the hedge funds might make a run on GOLD to drive up prices. Could be a risky move, but we might see $1,000+ gold prices soon unless the central banks bring it down like they did on Wednesday.

Thrusday, May 14, After Market Close

We had a good distribution day on Wednesday, which is usually followed by another distribution day within 2 to 7 days (unless stopped by a large accumulation day).

We are in a correction, but the question is - how big.

First, we have options expiration tomorrow and with the DIA, SPY and Qs are bearish, the big program traders will go all out to squeeze the bears for ssome profits. If we do have an up day tomorrow, but not a significant one, then the decline may continue on Monday when unencumbered by options expiration.

The CPCE and VIX is bullish at the moment, but can change to bearish with a good down day. Expect the McClellan Oscillator (NYMO) to also go bearish with a good down day. Right now it is neutral. The MACD, normally a reliable trend indicator, says we're into a downturn, but I'd like to see more distance between the slower red and the fast black lines.

The NYHL can warn of false breakdowns. If the red falls below the horizontal black line, then a decent correction is taking place an we're into a downturn. Even if the red line doesn't break below, small profits can be made during this correction, but don't expect a major correction to take place without the NYHL breaking down.

I'm shaded to the bearish side right now, but have tight stops in. If the NYHL breaks below the horizontal line, then it's time to commit more resources in anticipation of a large correction.

Some technical analysts say if a major correction is underway, then we've seen the all time high for many years and the market will go down to break the lows. Others say this is a correction that will take the S&P maybe to 780-800, then the market will rally to 1,000 or higher before seeing new lows later this year.

The market fundamentals are terrible, but the PPT and the big program traders (Goldman Sachs) have a lot of control over the market. The PPT want their insolvent banks to issue new common stock for recapitalization at high prices. They prevented an all out melt down on Wedesday, but this doesn't mean their bells can't get rung, which will likely take a black swan with market panic - - and there's lots of potential there. This could include a breakdown of the dollar below 80-82, treasury issues that don't sell, or more bad news. The market is skiddish and some real bad news will drop it like a rock.

Thursday's 15, 30 and 60 Minute Full Stochastic suggest prices could fall Friday.

We'll see how this plays out, but I wouldn't commit a lot of funds to the short side just yet. The next two, three or four trading days should let us know how big this correction will be, or if this is just a buyable dip. Given the market fundamentals, I have a real hard time going long in this market, so if it is a buyable dip, I'll probably go on remaining skeptical and stay out until things reverse.

Due to work committments, I'll be posting intermittently from here on in, maybe a couple times a week, or unless there's an important market event.

Monday, May 11, 2009 After Market Close

Short-term, are we heading into a bear trap or was Monday's decline the beginning of a market correction? The decline was strong, but it was not a significant distribution day.

The SPX weekly stochastics are on a buy, but topping. The daily has topped, has crossed and is in the 90s heading down, but it needs to break below 80 for a true sell signal. The 60-min is on a sell with the 30 and 15-min on a sell, but bottoming. Stochastics seems to be suggesting a decline early on Tuesday with a rally later in the day.

The 10-day moving average for the VIX is bullish and has been heading down uninterrupted for a couple weeks now. The McClellan Oscillator (NYMO) has been gradually falling from about 100 in early Arpil to 17.43 at the close on Monday. It needs to go negative for a sell.

Ths market is heavily manipuated, but Tueday's action should provide some guidance. If we have a decent down day, the NYMO might go negative, the VIX might turn bearish, and daily stochastics should break below 80. My hunch is it will go down on Tuesday.

The stocks played by the program traders are the DIA for the Dow, SPY for the SPX, and QQQQ for the NDX (here), and all are heavily bearish. We are going into options expiriation this Friday so the program players will be looking to squeeze the shorts going into expiration. With the embassies this bearish, the bulls will look to make some money with their put/call leverage, but it will take a big move up to panic the bears into selling. The bears should put up a good fight for the rest of the week.

And don't forget to keep a close watch on is the US dollar. The USDX has fallen to about 82.6 on the FOREX as the Fed continues monetization. The world stock markets could be collapsed to support the dollar to chase money back into US treasuries, which are also breaking down. The PPT will pick the time and dollar price to collapse the markets, which I think will be around 80.

If the market does continue to rise into options expiration on Friday and the US dollar continues to fall, expect a big stock market pullback to begin next week.

Saturday, May 9, 2009 Comment

Here's an email I got from one of my friends:

"I can’t understand the stock market going up. When will people figure it out that the economy still sucks, people are still losing their jobs, more foreclosures are coming. Did people just get numb? Do you have any thoughts when this will come crashing back down?"

Here's my answer to him:

That's the $64 question.

We have a Congressional authorized program from Treasury called the Plunge Protection Team (PPT) that is very active in the markets. The Treasury primarily uses Goldman Sachs (GS) as their proxy to buy stocks with taxpayer money to prop up the markets. GS is the most active program trader with the most recent data reporting they buy and sell more stock each day than the other 5 largest program traders combined. Some of the other 15 largest program traders are also PPT proxies (e.g., JPMorgan) with these top 15 responsible for 32.6% of the total volume of the NYSE. They for all intents and purposes control the market.

The market must be thought of as a casino. Right now, the put/call ratio on the DOW, the S&P, and the NASDAQ is heavily bearish. The bearish "puts" are 1.5 to 2 times the number of bullish "calls." When the market is this heavily bearish, all the PPT has to do is raise the stock market price a little, then the bearish traders holding "puts" panic and sell. When they sell, they have to buy stock to cover their puts. This raises the stock market even higher. It is called a short squeeze. A good portion of the rally for the last two months has been shorts buying stock to cover their puts.

This also works the other way. If the market starts going down, the longs with their calls have to sell stock, which will drive the market down further. With a heavily bearish market as it is now, the bulls have the advantage because there aren't as many calls to squeeze to drive the market down lower. They don't have the leverage.

What this means is as long as the market stays heavily bearish, it will help keep the market going up due to put/call ratio leverage. The market can be overwhelmed by bad news and drive prices down even in a bearish market, but with generally low volume as many participants are out of the market, the PPT can effectively control the market. In the mean time, GS and these other major program traders have made lots of money going long with the help of the PPT.

With Islam Saudi King bowing and hand kissing B Hussein in charge, he might keep giving the order for the market to continue to rise using the PPT. He did make a public statement about 2 months ago that "now is the time to invest in the market because its going to start going up." You know as well as me he's a control freak and the idea of manipulating the stock markets is way too much for him to resist. It's his pathology. He's got hundreds of billions of dollars in TARP funds he can use for market manipulation and it doesn't take much. Heck, with the market rising, the PPT is making a profit.

The failure of this rally starting on March 6th to provide any meaningful decline at all, means we are in a rally that is almost parabolic, which usually do not end well. It would be healthier for this two month rally if a 10% or so correction would happen. It would allow for a relief of overbought conditions and a retooling to send the Industrials toward 10,000ish in months ahead, before the inevitable big drop. If the DOW rises straight up to the 9,000 area without a correction, then we have to entertain the possibility Elliot wave (B) up is over, and the cataclysmic wave (C ) down (a massive market crash to 4,000 to 5,000 for the DOW) is coming sooner than anyone wants. Most economists have predicted this will happen later this year. Maybe not the way things are unfolding.

A Bloomberg article just said executives and insiders at U.S. companies are taking advantage of the steepest stock market gains since 1938 to unload shares at the fastest pace since the start of the bear market. Think they might know something we only suspect?

Another thing to consider is inflation, or devaluation. If the US dollar devalues a lot, this would drive stocks up as new inflated nominal dollars seek real dollar values. But the stock market is waaayyyy overvalued right now given earnings and profits - - now and projected.

How this all plays out is anybody's guess, but I do know one thing. This market will eventually go down big time at some point unless a big devaluation happens first. Even then, a big devaluation would drive prices lower for a short time before starting back up.

Monday, May 4, After Market Close

The market rally on Monday was strong with about half of the rise coming from short covering. The 15, 30, and 60 Minute Full Stochastics suggest prices could fall Tuesday. Regardless of what happens tomorrow, the market should keep rising higher in the short and intermediate term within a longterm bear market. This is not to say there will be short-term corrections along the way and we are long overdue for one, which should be viewed as a buyable dip.

The following article is from:

Larry Levin's Newsletter & Trading Signals

Although the stress test results are due to be released Thursday, as I predicted, some leaking has spilled out early. Today we received word that four major banks took the stress test and their grades were a big fat F.

Wells Fargo and PNC Financial Services were among four lenders mentioned today that will need to raise more capital; however, for these two no dollar amount of additional capital was mentioned. Test taken, grade F.

The report says that Shitigroup needs to raise an additional $10 billion. In response, Shitigroup says it is considering a plan to convert more than $15 billion in trust preferred shares, a hybrid of debt and equity, into common stock, the Financial Times reported. Test taken, grade F-.

Bank of America was also mentioned in the report; it is need of more than $10 billion. Some analysts were immediately quoted as saying this isn't a problem because BofA could increase capital through sales of businesses such as First Republic and Columbia, and investments such as China Construction Bank. Test taken, grade F-.

The market responded like a true 21st century touchy-feely teacher handing out grades: A+ for everyone. After all, we wouldn't want to hurt Shitibank's self-esteem; it may develop a complex. Citibank closed +8.8% today, PNC +14.1%, BAC +20%, and WFC closed up 23.7%.

Outcome based education meet Wall Street.

What's really scary is that these "stress tests" should have been very easy to pass. When the New York State Insurance Department issued a memo to all New York authorized insurers last year, it told insurers to conduct stress tests assuming extreme scenarios: "Interest rate shocks, equity market shocks, yield curve shifts, changes in credit quality and liquidity, rating agency downgrades, collateral calls, and large-scale catastrophes." However, the bank stress tests do no such thing. They rely exclusively on mild scenarios.

Shouldn't the worst case scenario for unemployment be the depression-era peak level of 25%? That sounds like a real test to me. However, in the outcome based tests administered by the Fed & Treasury the "worse-case" scenario is 8.9% in 2009 and 10.3% in 2010. What a joke! By this Friday the probability of unemployment reaching 9% is very high and I doubt that will be the worst for 2009. It's only May.

Shouldn't the worst case scenario for GDP be the 1932 contraction of 13.0%? But in the bank stress tests, the so-called "worse-case" scenario is a decline of just 3.3% in 2009 and only 0.5% in 2010. Uh-huh, real difficult test. The current trajectory is for GDP contraction of 5-6%.

Corporate bond default rates are absolutely critical in order to estimate the severity of future default rates on bank loans and derivatives; and Moody's has recently projected that they will exceed the levels of the Great Depression. However, in its report released Friday on the bank "stress" tests, the Fed makes no mention whatsoever of corporate bond default rates.

In the end, the stress tests were a joke as many have already said. The results will be whatever the Treasury wants - period. Sadly, even though the tests should have been easy to pass, the Treasury claims the four aforementioned large banks failed.

Sunday, May 2, 2009

All market measurements including a rising bearish wedge to bearish negative divergences to overbought indicators point to a corrective decline, but this has not happened. With Goldman Sachs acting as the Treasury's agent coupled with overall low trading volume, our stock market couldn't be more carefully choreographed.

The S&P (SPX) finally closed above 875 of Friday and will likely rise further on Monday. Often times, a market will produce a head fake and break upwards in an opposite direction before correcting lower, but the Plunge Protection Team (PPT) is very active and I would be careful about going short. The SPX will likely come back down to retest 875 on Tuesday or Wednesday, but it must move higher from there if the rally is to continue. If the SPX falls significantly below 875, we might finally have a correction, or a buyable dip. Keep your powder dry until we know which direction the PPT decides to take the market.

We have some bank stress test announcements later this week with greatest formulaic emphaisis on existing loan portfolios rather than toxic debt held. This heavily favors the big banks to the detriment of the regional and small banks. The stress test is a sham, but even with the formulas favoring the big banks, it is my understanding the news is not so hot. I can't help but think they will spin their way out of any truly bad news.

My best estimate for the short and intermediate term, with ongoing help from the PPT, is for the market to continue upward - - within a primary bear market. When the next big shoe drops is anybody's guess, but I think it shouldn't be later than September, and perhaps much sooner. There will be corrective declines along the way, but it will likely take a major event to bring the market down significantly. I anticipate the market will rally this week, then decline next week.

When the next big shoe drops is anybody's guess, but I think it shouldn't be later than September, and perhaps much sooner. When you consider foreign nations have signifiantly slowed purchases of our debt in the past four months, we have record deficits beyond belief, we're monetizing vast amounts of debt, the commercial real estate market is scheduled to fail this fall, there's loads of toxic assets yet on the books that will continue to grow, residential mortgage foreclosures won't attenuate until 2012, unemployment will continue to rise, the real estate sector can't pull us out as in past recessions, and there's no industry that can lead us out of this morass - - our situation can only be summed up by saying the only light at the end of the tunnel is a freight train heading our way. We're in for an economic conflagration at some point in time. So don't believe the talking heads when they talk about "green shoots," they're in fantasy land.

Overall, I expect is a serious devaluation of the US dollar soon. It's the only way for government to get the financial industry out of this mess, but at the expense of the middle class.

There was another small change in the McClellan Oscillator (MO) on Friday, which suggests we will see a large price move on Monday or Tuesday. The MO has proved very reliable for predicting large price moves.

Both 30-min and 15-min stochastics provide indecisive guidance for tomorrow, but my thoughts are the market will likely rally.

Flu Comments

Anonymous Said:

A great forum for information and updated news is http://www.swineflu.org/.

My Comment:

My just turned 8 year old son went to first grade at St Mels Catholic School in Fair Oaks CA last year. This school just made national news this week as one of the first schools in the US closed with confirmed H1N1 infections. This year we went him to another Catholic school about 1.5 miles away, but both schools comingle students for activites, so this has sort of hit close to home. We pulled him from school last week and will do so again next week.

My wife has been scrutinizing the web for the latest available news. After about 10 hours of this on Saturday, I finally had to say enough is enought as I sensed it was getting to her; so we went to a semi public place for a quiet dinner tonite.

The web site you mentioned appears good and we will spend more time on it tomorrow. Here's what I think:

1) Our government, and for that matter, all world governments are not being honest with us. For example, the US government recommends a school closure if a one student has become infected with H1N1 flu. There are over 400 school closures in the US this week, but the official number of US swine flu infections is a little over 100. The number of school closures says the official number of infections should be over 400. The available data suggests there might be tens of thousands of infected people in the US right now. We really don't know and I don't think our government knows.

2) An economic panic could create havoc for the world economy, which is on the brink of suffering a from a world depression. Any more bad news and a worldwide depression will most certainly enuse.

3) World governments are downplaying the scope of this bug as it could create economic chaos. It's a tradeoff. If governments were honest about the scope, economic chaos could ensue and cause thousands of starvation deaths worldwide due to decreased food production. World governments are likely gambling H1N1 will burn its self out shortly with the onset of summer; and that a vaccine will likely be available this fall. In short, creating a panic now could create economic chaos and cause deaths. A few thousand deaths from H1N1 in the interim is worth a larger number of potential deaths deaths from economic panic.

4) Contrary to what is officially said, governments around the world are reacting as if this bug is a major threat. Governments have the inside scope and I am of the opinion that if they think its this serious of a threat, then there's a lot more to it than they let on.

The point is, I don't trust governments. They have their own agenda(s) and it is incumbent upon us to read between the lines. I hope this bug is a false alarm, but until we find out otherwise, commonsense dictates vigilance and some precautions. We should know in the next couple of weeks the true scope of this bug. In the mean time, our family will avoid public places and spend our outdoor time in the country away from people.

Friday, May 1

I apologize for not posting lately, but have been busy with work assignments. Since the S&P closed over 875 today for the first time, I will provide some analysis later this weekend. In the meantime, I would like to take some time to discuss the H1N1 flu virus, which has been making news lately. There is a good possibility a national emergency in the coming week, which would have a big impact of the stock market.

Marcus Gitterle, MD: (Director of Longevity Research) is an Emergency Room Physician in New Braunfels, Texas. He sent out an email to some patients, close friends, and family a couple of days ago, which was intended only to help them understand the seriousness of this epidemic. One of the recipients went public with the email; and since then, he has been forced to backtrack somewhat on his comments to KSAT in San Antonio as the email indited the media for not providing adequate public awareness of the seriousness of the pandemic.

His comments are revealing. His original email message is as follows:

-----------------------------------

Subject: Flu Update from Dr. Gitterle

After I returned from a public health meeting yesterday with community leaders and school officials in Comal County and Hays County, Heather suggested I send an update to my patients in the area, because what we are hearing privately from the CDC and Health Department is different from what you are hearing in the media. Some of you know some of this, but I will just list what facts I know.

- The virus is infectious for about 2 days prior to symptom onset

- Virus spreads more than 7 days after symptom onset (possibly as long as 9 days) (this is more unusual than ordinary flu)

- Since it is such a novel (new) virus, there is no "herd immunity," so the "attack rate" is very high. This is the percentage of people who come down with a virus if exposed. Almost everyone who is exposed to this virus will become infected, though not all will be symptomatic. That is much higher than seasonal flu, which averages 10-15%. The "clinical attack rate" estimation from CDC and WHO may be around 40-50%. This is the number of people who show symptoms. This is a huge number. It is hard to convey the seriousness of this to those outside of the medical fields.

- The virulence (deadliness) of this virus is as bad here as in Mexico, and there are folks on ventilators here in the US, right now. This has not been in the media, but a 23 month old in Houston is fighting for his life, and a pregnant woman just south of San Antonio is fighting for her life. In Mexico, these folks might have died already, but here in the US, folks are getting Tamiflu or Relenza quickly, and we have ready access to ventilators. What this means is that within a couple of weeks, regional hospitals will likely become overwhelmed.

- Some of the kids with positive cases in Comal County have had more than 70 contacts before diagnosis as a minimum figure. - There are 10-25 times more actual cases (not "possible" cases -

- ACTUAL), than what is being reported in the media. The way they fudge on reporting this is that it takes 3 days to get the confirmatory nod from the CDC on a given viral culture, but based on epidemiological grounds, we know that there are more than 10 cases for each "confirmed" case right now.

- During the night, we crossed the threshold for the definition of a WHO, Phase 6 global pandemic. This has not happened in any of our lifetimes so far. We are in uncharted territory.

- They are advising President Obama to declare an emergency sometime in the next 72-96 hours. This may not happen, but if it doesn't, I will be surprised. When this happens, all public gathering will be cancelled for 10 days minimum.

- I suggest all of us avoid public gatherings. Outdoor activities are not as likely to lead to infection. It is contained areas and close contact that are the biggest risk.

- I suggest all of us avoid public gatherings. Outdoor activities are not as likely to lead to infection. It is contained areas and close contact that are the biggest risk.

- Tamiflu is running out. There is a national stockpile, but it will have to be carefully managed for law enforcement and first responders as it is not enough to treat the likely number of infections when this is full-blown. I don't think there is a big supply of Relenza, but I do not know those numbers. If I had to choose, I would take Relenza, as I think it gets more drug to the affected tissue than Tamiflu.

- You should avoid going to the ER if you think you have been exposed or are symptomatic. ER's south of here are becoming overwhelmed today-- and I mean that -- already. It is coming in waves, but the waves are getting bigger.

- It appears that this flu produces a distinctive "hoarseness" in many victims. The symptoms, in general, match other flu's; namely, sore throat, body aches, headache, cough, and fever. What is not too common in regular flu cycles is vomiting and diarrhea which seems to be associated with this, further dehydrating victims. Some have all these symptoms, while others may have only one or two.

- N-Acetyl-Cysteine -- a nutritional supplement available at the health food store or Wimberley Pharmacy, has been shown to prevent or lessen the severity of influenza. I suggest 1200mg, twice a day for adults, and 600mg twice a day in kids over 12. It would be hard to get kids under 12 to take it, but you could try opening the capsules and putting it on yogurt. For 40 pounds and up, 300-600 mg twice a day, for less than 40 pounds, half that.

- Oscillococinum, a homeopathic remedy, has been vindicated as quite effective in a large clinical trial in Europe, with an H1N1 variant. You can buy this at Hill Country Natural Foods, or the Wimberley Pharmacy. If any of my patients become ill, or suspect infection, call the office, do not come without calling and DO NOT go to the ER. If one member in a family is identified all would be given the Tamiflu or Relenza (that is normal course of action) if there is enough distributed to fill prescriptions.

Public health stated that one family member identified or suspected to have contracted the flu it will require the whole family to be ‘quarantined’ in their own home until enough time has passed for the remaining household to have contracted it or be considered infection free ( 7 to 10 days per person).

As another suggestion, if any member of the family is on routine medication- fill those prescriptions now. Have plenty fluids, Motrin, soups, etc available and make contingency plans in case your family is affected.

Dr. Marcus Gitterle

New Braunfels, TX

----------------------------

The 1918 Spanish Flu that killed 20 to 40 million worldwide was also the H1N1 version, but with an additional amino acid. The 1918 Spanish Flu also started out in the spring and was at first considered a mild virus throughout that spring. It died out in the northern hemisphere when summer came but sustained itself in the southern hemisphere as it is now starting to do in New Zealand, Australia and in Asia.

It was not until the fall of 1918 when everything broke loose in the northern hemisphere as people considered the virus mild and continued on to work and rapidly spread the infection.

Considering we are already at the end of the flu season and warmer weather has started, we are getting a massive spread of this virus; so this tells you how virulent this virus is. This suggests the next couple of winters will bring very high rates of infection and overwhelm the healthcare system. Watch Dr. Henry Niman of Recombinomics discussing"Swine" flu. His projections are disturbing, to say the least. He is a world-known doctor specializing in infectious diseases like SARS, flu, etc.

Remember, 9 out of 10 people will only get mild to moderate symptoms from this flu. According to Dr. Niman (who says he is not wrong and WHO essentially agrees with his analysis), Mexico is the prime proving grounds for this virus as it started in February and had a chance to take root.

To put things into prospective, based on the Mexico flu's virulence, if you see 1/3 of the population of the US get the virus as in 1918 - - say 100 million people - - expect to see 90% with mild to moderate symptoms, with 10% getting pneumonia, and an overall 3% mortality rate from pnemonia like in 1918 and now Mexico (actually, Mexico's mortality rate is thought higher). With a a 3% mortality rate, you could see 3 million US deaths. With modern medical technology, maybe this will fall to 1.5 million, which assumes we don't run out of medical supplies and our medical system is not overwhelmed.

So, don't consider virus to be a flash in the pan just yet. It is virulent and will likely be back next fall. Hopefully, we will have a vaccination available by this fall.

----------------------------

From the Survivalblog.com

The Mexican Flu and You

In the past 24 hours I've received dozens of e-mails from SurvivalBlog readers about the emerging Mexican Flu. Some news stories have included cryptic comments from heath officials, implying that the mechanism of infection makes this particular virus "very difficult to contain." This leads me to conclude that those infected have a long latency period during which they are infectious, yet, they do not display frank symptoms. This does not bode well for any hopes of containing the spread of the virus.

Then we hear a CDC official stating: "The swine flu virus contains four different gene segments representing both North American swine and avian influenza, human flu and a Eurasian swine flu." That strikes we as something very peculiar.

The disease is respiratory, and has one strong similarity to the 1918 Spanish Flu: "The majority were young adults between 25 and 45 years old," said one official under the condition of anonymity. Since, young and healthy people with strong immune systems are the most likely to succumb, this might indicate that the biggest killer is a cytokene storm--a collapse caused by the human immune system's over-reaction to a pathogen.

I strongly recommend that everyone reading this take the time to re-read my background article on flu self-quarantine and other precautions: Protecting Your Family From an Influenza Pandemic. The details that I give there are quite important. Pay special attention to my discussion of the shortage of hospital ventilators. If anyone in your family is immunosuppressed, consider yourselves on alert. Make your final preparations to hunker down, immediately.

In the next few days, there is a good chance of wholesale panic, including some well-publicized "runs" --probably first for hand sanitizer and face masks, and soon after for bottled water and groceries. Plan on it.

UPDATE: The BBC News web page Mexico flu: Your experiences has some updates posted from individuals in Mexico City.

To summarize, here are some key quotes from a recent article:

"This outbreak is particularly worrisome because deaths have happened in at least four different regions of Mexico, and because the victims have not been vulnerable infants and elderly."The most notorious flu pandemic, thought to have killed at least 40 million people worldwide in 1918-19, also first struck otherwise healthy young adults."..."But it may be too late to contain the outbreak, given how widespread the known cases are. If the confirmed deaths are the first signs of a pandemic, then cases are probably incubating around the world by now, said Dr. Michael Osterholm, a pandemic flu expert at the University of Minnesota."No vaccine specifically protects against swine flu, and it is unclear how much protection current human flu vaccines might offer."

Current statistics show a less than 10% lethality rate, but of course the first wave of flu victims are getting access to the best medical care available. If the contagion spreads, sheer numbers will quickly overwhelm hospital facilities--particularly the number of mechanical ventilators available. So the lethality rate may rise, even if there is not a viral mutation.

-------------------------

The BBC News web page Mexico flu: Your experiences has some updates posted from individuals in Mexico City. This article is worth reading.

Friday, April 24, After-Market Open

According to the short-term 15-minute chart of the CPC and the CPCE, it looks like the market will rally today as they have gone bullish. The long-term chart for the CPC and the CPCE are still strongly bearish.

The methodology for the bank stress tests will be released today, which should provide a clue as to the direction of the financials. As the financials go, so will the market. It will be interesting how the regulators fudge the stress test methodology to make the financials look good.

Update at 12:47 PM EDT:

If the SPX rises above 868.27 today, then the bulls will have over-powered the bears putting them in control of the market. So far, the high today on the SPX is 867.81, which is close, but no cigar. The bears have to make a stand here.

We have light volume today, which is to the favor of the bulls. The bears are likely cautious due to the stress test methodology release in about an hour. Though the financials have rallied some, with stress test consultations on-going during the morning today for the individual banks, I would think insider trading would propel the bank stocks much higher if the news was truly good. But this is speculation on my part.

Here's an article from Bloomberg:

Insider Selling Jumps to Highest Level Since ‘07 as Stocks Gain

By Michael Tsang and Eric MartinApril 24 (Bloomberg) --

Executives and insiders at U.S. companies are taking advantage of the steepest stock market gains since 1938 to unload shares at the fastest pace since the start of the bear market....

While the Standard & Poor’s 500 Index climbed 26 percent from a 12-year low on March 9, CEOs, directors and senior officers at U.S. companies sold $353 million of equities this month, or 8.3 times more than they bought, data compiled by Washington Service, a Bethesda, Maryland-based research firm, show.

That’s a warning sign because insiders usually have more information about their companies’ prospects than anyone else, according to William Stone at PNC Financial Services Group Inc.“They should know more than outsiders would, so you could take it as a signal that there is something wrong if they’re selling,” said Stone, chief investment strategist at PNC’s wealth management unit, which oversees $110 billion in Philadelphia. “Whether it’s a sustainable rebound is still in question. I’d prefer they were buying.”

Insiders Sell

Insiders from New York Stock Exchange-listed companies sold $8.32 worth of stock for every dollar bought in the first three weeks of April, according to Washington Service, which analyzes stock transactions of corporate insiders for more than 500 mostly institutional clients.That’s the fastest rate of selling since October 2007, when U.S. stocks peaked and the 17-month bear market that wiped out more than half the market value of U.S. companies began.

The $42.5 million in insider purchases through April 20 would represent the smallest amount for a full month since July 1992, data going back more than 20 years show. That drop preceded a 2.4 percent slide in the S&P 500 in August 1992....

The S&P 500 has rallied 26 percent over 32 trading days, the sharpest rally since 1938, as speculation increased that the longest contraction since World War II will soon end....

Update 1:40 PM EDT:

The bulls just took the S&P above 868.27 proving they control the market. This wipes out Monday's decline. If the S&P goes above 875, then the market might be off to the races as shorts cover and drive the market higher. The put/call ratios for the SPY, DIA and Qs are heavily bearish; so there's a lot of short covering ammunition to support a rally.

Using the 15-minute charts, the VIX just went bearish with the CPC and CPCE still bullish, but with a diminishing slope and giving appearances they might be heading into a level - or sideways mode. The daily charts still still have all three indicators in a bearish mode.

Update 2:45 PM EDT:

The stress test methodology announcement turned out to be an absolute joke. There's no interest in transparancy and the final report to be released on May 4 will be the same.

As long as the S&P stays below 875, which was last Friday's high, then the market is still considered to be in a corrective pattern with an initial downside target of 780. With today's lack of transparency, there will be a big sell-off in the next couple days.

The 15-minute chart shows the CPC (at 0.85) and CPCE (at 0.79) have gone from a bullish downward slope to horizontal; i.e., neither bearish or bullish. If they turn upward to a bearish slope, then we will likely have a sell-off at day's end and on Monday.

Friday, April 24, Pre-Market Open

Here's a graph using 15 minute increments for the past 10 market days. The graph uses the CPC, CPCE and the VIX laid out against the S&P (SPX). Of the 8 buy-sell opportunities during the past 10 days, the CPC and CPCE failed twice as indicators, which is a 75% success ratio when predicting market direction. Notice the CPC and CPCE when used in conjunction gave more than adequate notice of a trend change. The VIX is a laggard, but provided verification in most circumstances.

So what does this mean?

The graph shows the CPCE just went bullish at the end of the trading day on Thursday. The CPC is still bearish, but appears to be rounding to a top and might head down. The VIX is already bullish. Looking back at prior days, when the CPCE turned bullish just before the end of the trading day, it usually means the market will decline for the first hour - - to an hour and a half - - in the morning, then go bullish the rest of the day. This hasn't yet been confirmed by the CPC, so this will bear watching in the morning.

Once again, if prices rise to 875 tomorrow, it means the correction was shallow and is likely over. If the market falls to 825, then a larger correction is in store, likely down to at least 780 on the SPX.

I will post about an hour after the market open in the morning to provide guidance.

Thursday, April 23, After Market Close

Our three leading indicators are on the bearish side after the close today. The CPC went to 0.91 after close, which is a large turn to the bearish side. The CPCE is 0.73 and the VIX continues a bearish direction.

We had a large distribution day (sell-off) on Monday, April 20 when the market had a solid decline. Distribution days usually come in pairs usually no more than 2 to 7 days apart with 3 days being the norm. We are likely due for a big distribution day on Friday or Moday. It takes a large accumulation day to stop a distribution pairing, which will likely require a break above 875 on the S&P.

The bears have three more days to take the S&P down below 830, say 825, to prove they are in charge.

Due to a small move in the McClellan Oscillator today, we will get a big move to the upside or downside on Friday or Monday. Everything points to a big downside move.

Are Institutional Investors Buying or Selling Now? by Marty Chenard

Everyday, Institutional Investors buy stocks and they sell stocks. If they buy more then they are selling, then they are in Accumulation. If they sell more then they are buying, then they are in Distribution.

Which mode they are in matters a lot, because over 50% of the stock market's volume comes from the action of Institutional Investors.

Today's chart explanation: The red mountain chart represents the amount and trending of Institutional Selling activity. The blue line represents the amount and trending of Institutional Buying activity.

If the blue line is above the red mountain chart, then there is more buying than selling occurring and Institutions are therefore in Accumulation. If the red mountain chart is higher than the blue buying line, then there is more selling happening than buying and Institutions are in Distribution. And ... because they do more than half the trading in the stock market, the market indexes follow their actions. Note the correlation between the Institutional activity and the NYA Index below.

So, what are Institutional Investors doing now?

First, the Institutions had an Accumulation "Buy/Sell cross over" on March 13th. They have been in Accumulation since then, and the market has trended up since that time.

Second, notice how much buying Institutions have been doing during the past few weeks. The Buying is becoming less and less. There is still a lot more buying than selling going on, so Institutions have remained in Accumulation ... but doing less of it. So what that says, is that Institutions are buying less as the market is being driven up by smaller investors. If the selling trend reverses to the upside, then Institutions will start to take profits and sell into the market.

The 2002-2009 section of the chart to the immediate left shows how seriously the stock market has been really hit. Note that the drop from the peak has been extremely dramatic with the Institutional Index falling well below the lows of the 2002 Bear Market.

Now, took a look at the "close up" in the upper left hand corner. Yesterday was an important level the our Institutional Index ... it closed right on the support line for the July 2002 Bear Market Low.

This is no ordinary level ... it is an extremely important "test level" for the Institutional core holdings. If it cannot hold this level, all the other major stock market indexes will also run into trouble.

Wednesday, April 22 After Market Close

I've just got back in from out of town. I left when the market appeared to be rallying and was presently surprized to hear it fell at the close. There was fairly good volume and this was a good showing by the bears. Today was the first time since March 10 the bulls could not make two consecutive up days.

The attached chart shows all of the technicals indicators have gone bearish with the exception of the CPC and CPCE. Unfortunately, these are the two main leading indicators with the rest being lagging indicators. But the CPC and the CPCE will go in the bullish or bearish based on market action over the next day or two. Consider them in a roughly neutral position. The VIX went bearish.

The 30 and 15 minute stochastics suggest the market should decline tomorrow. But we will have a lot of earnings announcements along with initial unemployment claims and existing home sales before market open.

The pre-open announcements will determine market direction tomorrow. I anticipate existing home sales will rise due to seasonal trend, which should put the market in a good mood. It will take poor earnings and intial unemployment claims for the market to decline.

Unless there is fantastic news, I do not expect the S&P to reach the April 17 high of 875±. The bulls must break 875 tomorrow to prove they are in control. If they do, it might be game over for the bears as the shorts start covering and drive the market higher. The market is in a decline, but we can expect some volatility along the way. I do expect the S&P to fall to at least 780 in the coming week.

The 30 and 15 minute stochastics suggest the market should decline tomorrow, but once again, announcements will determine its direction.

Tuesday After Market Close, April 21

The market rose today as expected, but far more than it rightfully should have. In the face of bad earnings announcements, even the financials and the REITs rallied. The bears put up a good fight, but were overwhelmed by the market manipulators' sheer volume.

This market is manipulated to the point of becoming pathetic. The upside action in the equity markets ahead of Turbo Tax Tim's remarks was about as blatant as it gets. After the news for the past few days exposing the "program trading" by the market manipulators - - Goldman Sachs, JPM, and others; you'd think they'd lay low a couple days to give themselves some plausible deniability. But this is most certainly not the case. When the market is this heavily manipulated, there is no choice but to follow the market manipuators, which appears to be an up market direction.

Then you have Turbo Tim lying at today's hearing that the stress test results show that the 'vast majority' of US banks have more capital than they need. Yes, the banks banks with adequate capital that have been well managed, but not the five or six largest money center banks that have trillions in bad debt and toxic derivatives who have been soaking up all the available capital in the economy and leading us into a depression. This Administration is getting out of hand.

The 30 and 15-minute stochastics say the market should decline tomorrow. In the attached indicators graph, the VIX went bullish and needs to go bearish for the long overdue correction to take place. Let's see what tomorrow brings.

Tuesday, March 24 - Pre-Market Open Commentary

6:00 AM EST

The futures market suggests we will open to the upside, but this will depend on earnings announcements before the open. The Asian markets were mostly down, but the European markets are up slightly with a spat of good news about retailers.

The 15-min and 30-min stochastics are oversold suggesting prices should rise today, but I do not expect a big up or down day today at the close. More likely the market will work off some of its short term oversold condition for a day or two before proceeding lower. Depending on earnings announcements, today should be a might be a good day to enter short. I do expect the market to trend lower for the next week, maybe two, with a minimum downside target of 780 on the S&P.

I will be waiting to see how the earning announcements affect the market before entering short.

12:00 Noon EDT

The earnings announcements this morning were not so hot, but as expected the market is rallying. Given the fairly heavy volume, the bears may have shot all of their bullets this morning leaving the bulls a clear path upwards. The CPC went bullish this morning, but may change by the end of the day. Caution is warranted at this time before entering short.