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The Charts are Scary Bullish 10/9/20

This is a syndicated repost courtesy of Stool Pigeons Wire at Capitalstool.com. To view original, click here. Reposted with permission.

Going through my stock screens this morning, I was shocked at how bullish the output was. Chart after chart. Sells were few and far between.

I think we’re going to have to grit our teeth for awhile. But this isn’t a surprise. We knew for a couple months that the liquidity outlook for October was very bullish.

Last night, I left you with the 5 day cycle projection on the ES fucutures of 3485. Overnight they got to 3459. Now the 5 day cycle projection is 3500. Lordy, lordy.

As I write at 4:35 AM ET, they’re sitting on an uptrend channel line at 3449. As of 9:30 AM the line will be at 3460. Gotta break that for any hope of a reversal. Uptrending resistance is now around 3459, 3470-75. If they clear those consider 3500 a done deal.

I’ll be trading from the long side again today unless something radical happens.

I caught that one breakout yesterday, and spent the rest of the day floundering, dipping toes in the water. The sharks bit them off.

Later!
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Federal Tax Collections Now Say Damned If They Do, or if They Don’t

Tax collections have leveled off at a negative year to year rate. The Fed has gone to Congress begging for fiscal support for the US economy, as a result.  Without a deal to raise spending, the economy will continue to languish, and the Fed will continue to print money to support the markets.

Ironically, if and when a new pandemic relief spending program is enacted, that would be bearish.

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Tick Tock – Market Is a Broken Clock

Mixed cyclicality has led to a rangebound market. There’s no sign that that will change this week. But look out if it does!

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And from Liquidity Trader, where I’ll post another update later this morning.

 

If Bonds Sell Off, Dealers are in Trouble and So Is the System

Primary dealers have maintained huge and heavily leveraged long bond positions. They are only lightly hedged. Just today, the bond market is threatening to reverse the long term downtrend in yields/uptrend in prices. It’s bad news for the bond market, and for the system as a whole. And that includes stocks.

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Wall Street Examiner Disclosure: Lee Adler, The Wall Street Examiner reposts third party content with the permission of the publisher. The opinions expressed in these reposts are not those of the Wall Street Examiner or Lee Adler, unless authored by me, under my byline. I curate posts here on the basis of whether they represent an interesting and logical point of view, that may or may not agree with my own views. Some of the content includes the original publisher's promotional messages. No endorsement of such content is either expressed or implied by posting the content. All items published here are matters of information and opinion, and are neither intended as, nor should you construe it as, individual investment advice. Do your own due diligence when considering the offerings of information providers, or considering any investment.

Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also publish LiquidityTrader.com, and was lead analyst for Sure Money Investor, of blessed memory. I developed David Stockman's Contra Corner for Mr. Stockman. I’ve had a wide variety of finance related jobs since 1972, including a stint on Wall Street in both sales, analytical, and trading capacities. Prior to starting the Wall Street Examiner I was a commercial real estate appraiser in Florida for 15 years. I was considered an expert in the analysis of failed properties that ended up in the hands of bank REO divisions, the FDIC, and the RTC. Remember those guys? I also worked in the residential mortgage and real estate businesses in parts of the 1970s and 80s. I have been charting stocks and markets and doing analytical work since I was a teenager. I'm not some Ivory Tower academic, Wall Street guy. My perspective comes from having my boots on the ground and in the trenches, as a real estate broker, mortgage broker, trader, account rep, and analyst. I've watched most of the games these Wall Street wiseguys play from right up close. I know the drill from my 55 years of paying attention. And I'm happy to share that experience with you, right here. 

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