Hold The Line

Between all the drama and the ritualistic gyrations of FOMC day the SPX managed to hold a pretty important line today.

Call it another safe by the bulls, dumb luck, or good ole’ fashioned Fed sponsored manipulation – we don’t care and whatever it was – it does have implications on what lies ahead for the remainder of the week and most likely into the next one.
[amprotect=nonmember] Charts and commentary below for anyone donning a secret decoder ring. The rest of you guys will have to wait until tomorrow – sorry. If you are interested in becoming a Gold member then don’t waste time and sign up here. And if you are a Zero subscriber it includes access to all Gold posts, so you actually get double the bang for your buck.
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Now in my previous post this afternoon I was pretty clear about my medium to long term market perspective, which as you know does not entail a bright and shining future for anyone long equities. Short to medium term however it is important to remember that the bulls held the lower support line of our ending diagonal today. We chopped through it in the morning but the marines stormed in right away and didn’t take any prisoners.

I still think we keep on grinding higher until the last bear has thrown in the towel. The latest paradigm making the rounds among lemmings and pundits now is that QE 2.0 (or 1.1) has merely been postponed and thus it can already be priced in. We are officially in a bad-news-up-good-news-up market. So much about trading the news, folks – if you still care then you either have a masochistic gene or are a gluton for punishment.

Wave count is getting messy but I’m sticking with further upside before a drop. Soylent Blue is there as a possibility but nothing I saw today increased its odds even by a fraction of a percent. Yes, this market is a steaming pile of vapor rub but thus far it’s melting higher into Soylent Green – we cannot argue with that. The past week was a complete waste of my time and I hope that this week won’t play out the same way otherwise I may have to commit ritual sepukku down here in the evil lair. A market megalomaniac can only take so much after all.

If you are a Zero subscriber then I suggest you take a look at the updated daily Zero – I put a comment on the chart in case you are getting any short term bearish ideas.

Did I mention I am looking forward to autumn?

Cheers,

Mole