CYPRUS - CASE IN POINT OF WHY LYING IS DANGEROUS
Here is a link to a story that is an example of why the governments always lying to the public about things is not cute or ok but dangerous. It is also why it is not enough for officials to just be smooth charismatic and charming. At some point they also have to be competent and not corrupt.
I think most people know at this point not to trust these types of reports that come up but I am guilty. I trusted the CFTC and NFA when they came out after MF's implosion and told us they had audited all the other FCM's and everything was fine. I left my money where it was due to that report and almost had my life ruined because I trusted them. It is forever altered without a doubt. I will ultimately recover but the time lost in the process cannot get regained. I for one want the truth and don't determine for me in advance that I can't handle it. Let me decide how to handle it. Most of us won't panic we will act rationally.
I think the real lesson learned at this point is that you had better have your money spread out. We are guaranteed more PFG/MF Globals and more bank failures. You just cannot put all your eggs in one basket. As much as in my mind I have identified TD Ameritrade as the safest place in the US Futures brokerage community to have money, I still won't ever put all my eggs in one basket ever again. Spread your trading and savings money out. I also think you should do it with IRA's. My whole life long IRA was at PFG among my multiple accounts there. You don't want to have that whole thing taken away believe me that is emotionally very taxing.
I don't think it is ok for us to be told over and over everything is fine when it is not because we might panic if we thought the truth was not so rosy. Life has cycles good and bad we can handle it. The fact that we all have gotten used to accepting all the lies in these reports and don't complain enough is on us. We are letting them get away with this.
To the markets
Here is the Bernanke 500 and for the first time in a while I think we are getting a tad top heavy.
I have two different things on this chart. The purple line is an accumulation indicator and the blue line is a momentum indicator. They are both showing weakness as opposed to the price. The purple line is more stable and a better indicator of whether or not underlying weakness is developing. The blue line is kind of volatile and moves all over the place, so it can be ignored for the time being. We still are holding all the relevant trend measures as far as moving averages go. However, I think if we were to break down below the lows of the last few days we could have some problems. Will we? Who knows.
I don't think the FED is in any mood to allow much of a decline and this is where the cyclical forecasts have gone astray this year. All of them are based on history and we have never had a time when our government has taken over the stock market like this. The natural forces have been over powered by the FED's activities so the cycles have been artificially removed so to speak. There is no sign of that changing any time soon so trading the ES is very very tricky. If you look at the average for the first year in office of a presidents second term, on average a high was made in mid March. So far that has been the case so perhaps that is some ammunition for short sellers.
What I would prefer is a sharper break down and bounce for a short entry but I have no idea if that will happen. For now I am thinking we are going to move sideways.