THE WORLD WAITS
There is no comfort in knowing where we have come to, I still have a hard time accepting where we are in our history. The markets everywhere are sitting perfectly still waiting for the Federal Reserve today. We have fallen so far that the only hope we have for the markets to rise is for the Central Bank too manipulate prices. As a result people are waiting quietly in hopes they will announce something else to artificially stimulate the economy. I just wonder what great leaders of the past would think if they were forwarded in time to this moment, and witnessed days like this.
What worries me the most is that this is so evident now, that they have had to raise the bar higher and higher just to keep us treading water. The expectations are so high now, that at some point no matter what they do, they are going to disappoint. When this moment happens we are going to have a sharp sell off. Just picture storing up rain water for months and years in a reservoir, trying to keep the ground below it artificially dry. At some point when it does ultimately get released, it is a flood that wipes out everything. Had you just allowed the rain to hit the ground as it came down over time, there might have been so soggy conditions that were unpleasant, but the flood that wiped out everything would not have happened. This is where we are. Their refusal to let the natural course of things play out is going to result is an awful end game here. I have been saying this for awhile now and I am more and more sure of it every time they do something to "prevent" a decline in anything. Why can't prices come down?
They are over promising and under delivering, a bad mantra to have. When I just watch the markets trading as if nobody knew they were open an hour into the day, it is all the proof we need that something has gone horribly wrong here. Of course that is just idle chat by me, nothing we can trade off. I would suggest not getting tied up in trying to guess what they are going to do, and putting trades on in sync with your guess. That is roulette, you may get a few right but in the end you are going to get wiped out doing that. Stick to your discipline and your normal entries. If you happen to get stopped out on one of these reports so be it. There is no way anyone can guess the true manipulation that is going on, and it is a waste of time to try.
The first chart for today is that of SILVER, cousin of the world's favorite market. Although from a larger perspective I still think we are going to move up in general between now and the end of the year, this appears to be setting up a possible short term sell signal. This market has broken down from it's highs of the year quite a bit, and is much weaker than cousin GOLD. I am watching this market for a short entry each day right now.
The next chart is Crude Oil. Although Unleaded Gas is the weakest, this whole complex seems to be setting up for a tumble again. It all depends on what the Fed does unfortunately, since this is trading in general in the direction of stocks. However, be on the alert for sell entries in this market. Even if the Fed does something really bullish, my gut tells me it is going to be short lived in terms of the rally it creates. I just think they have painted themselves into a corner and the inevitable is coming no matter what they do. If it does come, the short side almost everywhere is going to be the place to be.
There are other setups I have mentioned recently, and I can't put them all in one post, so check them out they are still in play except Natural Gas. Natural Gas just went straight down and never gave any buy signals. Also, someone commented on Sugar the other day. That is why I said to straddle the market, it was setup to break out one way or the other.