Yesterday was the Day of the Dead in some countries in Europe, particularly the one where I live now, France, and the one where I lived last year, Poland. Everyone gets together to go to the cemetery to weep over dead loved ones. Today is the day in the US. We all gather around the teevee screens to weep over the dead bull market, as Load Jaysus pronounces incantations over the dead bull in incomprehensible tongues. Everyone prays for the reincarnation of the lost loved ones, many who have risen to Crypton, or descended into its hell fires, as the case may be.
Meanwhile, back on Wall Street, the only question is whether the dealers are long or short. Too bad, they’ve been long and wrong on the bond market for a couple of years, barely getting back to flat positions in their hedged bond portfolios in recent months. As a result of the Fed draining money from the banking system and the dealers’ accounts, and their customers accounts, liquidity is increasingly tight. Only the use of leverage via margin and repo, keeps the pot simmering. That can only last so long, as the Fed keeps sucking up liquidity.
As for how the Dealers are positioned on stocks, we can only guess, because they don’t publish information on that any more. They used to (delayed Member and Specialist long and short sales data), but the NYSE ended that practice years ago when it went from being a private members only club to a public corporation. Interesting. They went from private to public, but took their information from public to private.
Wall Street lets you know what it wants us to know, so that it can manipulate us to do what it wants us to do- buy their inventories of securities. And when the Fed and Treasury publish information that’s actually useful in helping us to know whether that’s ok or not, the Street and its media handmaids do their best to hide and obfuscate it so that we can’t easily see what it’s telling us.
I’ve made it my business for the past 22 years to observe and report that information to you so that you can use it to your benefit. My latest report is here. I’ll have another one coming today on the month end Daily Treasury Statement data, which tells us, yes, Virginia, the economy is still cooking, Friday’s jobs data should “beat” and the Fed will have no excuse to pivot or pause or step down, or whatever the Wall Street media’s latest buzzword is to lull you into a stupor.
Meanwhile, the ES, 24 hour S&P fuguetures chart looks like this. Dead in the water, poised for a 3 day cycle upturn, but due to hit resistance around 3895 at about the time the smoke signals appear from the roof of the Fedican on St. Eccles Square. Then His Eminence Pope Jaysus the First will rise before the assembled multitude in the Square at 2:30 PM ET to pronounce his incantations in tongues. The masses below, and the markets themselves will writhe in ecstatic pain for a few hours, overnight even, and even into the wee hours of the morning as the besotted ecstasy of the fades into a sullen march toward whatever.
Will it be up, or down? I’ll keep you posted.
More later.
Big picture stuff below.
- Swing Trade Screens – Adding a Few Buys While Meat Grinder Chews Up Shorts November 1, 2022
- Bear Market Isn’t the Mirror of a Bull October 31, 2022
- Why You Should Stay Skeptical of Bullish Technical Signs October 30, 2022
- Swing Trade Screens – Operation Extrication October 24, 2022
- Signs of an Intermediate Bottom in Gold October 22, 2022
- Bears Beware, Treasury Buybacks Will Turn the Markets, Sooner Not Later October 21, 2022
- We Can Now Project When Fed Will Pause, But Not Reverse October 13, 2022
- Look Out For the Real Fallout of Declining Withholding Tax Collections – Part 2 October 6, 2022
- Look Out For the Real Fallout of Declining Withholding Tax Collections October 5, 2022
- Markets Face Catastrophe as Dealers Mitigate Too Little Too Late September 26, 2022
- Fed Speeds Into Dead Man’s Curve, More Black Tuesdays Ahead September 15, 2022
- There Will Be More Black Tuesdays September 14, 2022
If you’re serious about the underlying forces of supply and demand that drive the markets, join me!
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