Welcome and thank you for visiting!

The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
* Major World Market Indices * Futures Markets * U.S. Sectors and ETFs * Commodities * U.S. Bonds * Forex

* The content in my articles is time-sensitive. Each one shows the date and time (New York ET) that I publish them. By the time you read them, market conditions may be quite different than that which is described in my posts, and upon which my analyses are based at that time.
* My posts are also re-published by several other websites and I have no control as to when their editors do so, or for the accuracy in their editing and reproduction of my content.
* In answer to this often-asked question, please be advised that I do not post articles from other writers on my site.
* From time to time, I will add updated market information and charts to some of my articles, so it's worth checking back here occasionally for the latest analyses.

DISCLAIMER: All the information contained within my posts are my opinions only and none of it may be construed as financial or trading advice...please read my full Disclaimer at this link.


* If the dots don't connect, gather more dots until they do...or, just follow the $$$...





* Wed. July 31 @ 2:00 pm ET - FOMC Rate Announcement + Forecasts and @ 2:30 pm ET - Fed Chair Press Conference
* Wed. Sept. 18 @ 2:00 pm ET - FOMC Rate Announcement + Forecasts and @ 2:30 pm ET - Fed Chair Press Conference
* Thurs. Nov. 7 @ 2:00 pm ET - FOMC Rate Announcement + Forecasts and @ 2:30 pm ET - Fed Chair Press Conference
* Wed. Dec. 18 @ 2:00 pm ET - FOMC Rate Announcement + Forecasts and @ 2:30 pm ET - Fed Chair Press Conference

*** CLICK HERE for link to Economic Calendars for all upcoming events.

Tuesday, September 27, 2011

Markets "testing the mettle"...

In previous posts, I referred to the current economic situation facing the average American...namely:
  • the prospect of higher inflation to be brought about by a rise again in equity, oil and commodity prices because of the Fed's decision to hold interest rates low for the next two years, along with the potential for further monetary stimulus by various world governments
  • the slowing in domestic and global economic growth
  • the slowing in consumer spending
  • the continued depression in house sales
  • the continued acceleration of the national debt at enormous rates because of an imbalance in tax and GDP revenues versus government spending and debt repayment obligations
  • the continued high unemployment rate
  • continued cross-border red tape and trade protectionism
  • concerns over Europe's fractured economic, financial, and fiscal policies
Add those to the uncertainty of a federal election facing Americans in 2012, along with a dysfunctional and unco-operative atmosphere surrounding any probable agreement on major bills facing the politicians between now and then, and we get quite an unappealing economic and social smorgasbord from which to pick our appetizers, main course, and dessert. This is the kind of table that Mr. Market has set out for all to peruse.

The market participants have gorged and purged since August 5th, alternating between fear and complacency, with large, volatile intraday swings and gaps...the gaps, most notably, have been around the August 8th level...traders seem to be concerned about the S&P downgrade of the U.S. credit rating that was issued on August 5th, along with the Fed's downgraded economic outlook for the U.S. on August 9th.

It may take more than just the emergence of a financial bail-out package being contemplated in Europe (or even in the U.S. at some future point) to set a proper table from which to feast without fear of the table cloth being violently yanked out from underneath, sending the food flying in the process. The markets, and the public in general, may wish to see a concerted, sincere effort, with decent results, from politicians which actually fix these problems...and soon. In the absence of such a scenario, I would consider any continued bounce in the markets to be undertaken on "borrowed time and highly leveraged money," carrying with it considerable downside risk.