This week is options expiration week… Wall Street’s favorite time to ramp the markets in order to insure the maximum number of options contracts expire worthless.

THIS, nothing else, is why the markets rallied this week. Tweets from the President or some statement by a Fed official were simply the excuse Wall Street used to engage in this game.

And that game is now ending. Stocks face TREMENDOUS overhead resistance here.

GPC117181.png

The debt markets have already figured this out and are moving into “risk off” mode.

GPC117182.png

So have Transports.

GPC117183.png

And Homebuilders.

GPC117184.png

You can ignore those internals all you like, but what has actually changed since the end of December? Is the Fed going to start loosening monetary policy? Is the economy suddenly going to start roaring again? Are earnings going to reverse and stop declining?

Or are we actually at the end of the credit cycle and moving into the next crisis shortly?

GPC110193.png

A Crash is coming…

GAINS PAINS AND CAPITAL

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.