Marketspath

10/09/12 written report

2012-10-23T18:04:00.002-07:00

Hi Everyone,

It is quite amazing how the games are being played in this market. The minute everyone starts looking one way, the bots are usually building a position in the other direction. The news media help the big firms convince the public that this is what is happening and you have to be in or out of this market. Usually what they are telling the viewers-is the exact opposite of what they are really doing.

The slogan of choice over the past 4 weeks, has been "forget about everything and just buy-the Fed is behind the market". I am going to be totally honest with you. That type of slogan and the amount of buy in it got from investors and air time-often marks bull market tops. When you "forget about everything else" and buy with the belief someone or something will not let it down-that is outside the normal demand/supply chain-you are pinning a label on your head saying "I AM RECKLESS"

It goes the same for the bears as well. When you short the markets after very extended moves with the belief that "this market will never go up" you are now pinning a label on your head saying "I AM RECKLESS" When one side become reckless, they often lose a lot of money in the market.

Now I am NOT saying that we made the bull market top. I am just pointing out that this type of thinking and attitude, has marked bull market tops. Heck, I remember the "Bernanke Put" being harped about all throughout 2008. How you just had to buy the dips because "the Bernank won't ever let this market down". When the normal supply/demand chain gets disrupted by outside forces, when it gets back on course-which it ALWAYS will-there is usually hell to pay. The problem with trying to trade that thinking-is you have no idea when the normal supply/demand chain will come back into play. It may be next week-next month-next year-or even 5 years.

One thing I am sure of, when it does come back into play, there will be little doubt about it being back or not. The market hates uncertainty and over the next 30-90 days, there is more uncertainty out there than anyone can imagine. China-Europe-Elections-Fiscal Cliff-Will Ben be in office come January-if he isn't, will the new Fed chairman carry on this madness of a plan Ben has put in place.All of these things are UNKNOWN-which brings UNCERTAINTY into the picture.

Many were placing some very big bets that we would see the indexes scream higher into the elections. Who am I to say they won't. But for every action there will be a reaction. For every buyer there will be a seller. The question at large-are the big boyz willing to ramp these indexes higher, now that the polls are too close to say who is in the lead? Maybe and we will find out soon enough--my GUESS-NO THEY WILL NOT.

How confident am I with my guess? If I was that certain they wouldn't ramp it up into the elections-I would NOT have covered the 1/3 short side position we had open in the port. I am not in the market to guess. I will have a road map-if the road map is being followed, run with it. When I make a mistake (like the shorts we had open) I have to make a trading decision. Should I listen to the talking heads and get crushed on a way underwater position-or follow the patterns-timing systems and market breadth and hold for a better exit. I choose to trust the systems and we got out of 2/3 now with some minor scrapes.

The timing systems are actually looking bullish. But I will be perfectly clear-with the con job that has gone on over the last 6 weeks and the amount of bulls that are now starting to feel their blood pressure rising-SURPRISES WILL COME TO THE DOWNSIDE!! If too many believe that they aren't imagining the smell of smoke and start to run for the exits-the large institutions are ALREADY positioned for the drop-per the C.O.T reports.

Right now, the spx is about 30 points from Friday's high. There is no reason to sound the alarm bells or start expecting a massive drop to hit. I believe there is reason to listen for the alarm bells and if you hear them-it isn't the bells ringing in your ears. There are many reasons to be on very high alert for what looks like a small pull back-to turn into something else. All the ducks are lined up-but I am not smart enough to know if this is the one or not-so we will just trade.

With the timing systems on a buy signal and the indexes nearing some support-I wouldn't get too aggressive adding new short positions down here. Manage what you may have open and then wait for a better set up. I am not that interested in looking long at this time. G-

Open port positions:

09/04/12 IWM short 1/3 @ 81.59

Recently closed

09/04/12 IWM short 1/3 @ 82.20 (closed 10/09/12 @ 82.57) -.37
09/06/12 IWM short 1/3 @ 83.11 (closed 09/25/12 @ 83.69) -.58
09/14/12 IWM short 1/3 @ 86.64 (closed 09/17/12 @ 85.80) +.84
09/10/12 IWM short 1/3 @ 84.27 (closed 09/11/12 @ 83.92) +.35

Full closed positions-click here

Bigger picture road map I am following

Click on charts to enlarge

60 minute timing system: Stochastics are very oversold and we have a clear bullish divergence in place. Some type of bounce is expected. Short term view Bullish

60 Minute timing system (Time Frame-Short term)

Block Volume System: The block volume indicator is in the oversold area. We have seen rallies try and start from these levels-but support for the indexes is still a little further down. So maybe a bounce soon-followed by another round of selling is in the cards. Short term view Bullish

Block Volume chart (Time Frame-Short term)

60 minute Chart If wave C is going to match wave A 100%-the target for IWM is at 81.50-which is also support. Technical's are very oversold right now.

IWM 60 minute chart

10/17/12 written report

2012-10-23T18:03:00.001-07:00

Hi Everyone,

I am still waiting to hear from the Doctor and I am still not sure if I will be in the office tomorrow. But I will be able to have everything ready for the live charts before I leave (If I have to leave)

The inverted head/shoulders pattern I was following with IWM is not in play anymore. The small caps, which have under-performed the other indexes since Monday's lows-played catch up today and were the best performers today. When they try and catch up after a large move has already been in place with the spx. it usually means traders that missed the upside move are chasing beta. When either side chases-they usually lose. I don't think this time will be different.

My timing systems were looking for a rally as early as Monday-per my weekend report and that is exactly what we have seen. Now they are looking for some weakness and I wouldn't be surprised if the expected drop takes some by "surprise" They key to this road map-is the dollar finding some support and start to rally. If they continue to pressure the greenback down, we will see sideways or even more upside before the next turn.

There are some fractal patterns I am watching that are looking for weakness to start as soon as tomorrow. Whether we need a bit more upside first remains to be seen-but I believe this move is running on fumes right now. The longer they push it higher on no gas-the more powerful the drop will be when we top.

Off topic-kind of--I am seeing many economist labeling a housing bottom because of the housing starts number today. Adding more supply to excess supply is hardly any reason to say "housing has bottomed" Building companies do what? They build! They already own the land and they can either just sit on it or build and try and sell homes. In no way do I see this "housing stat" a reason to believe real estate is back in an uptrend. Being a home owner myself-I HOPE I am dead wrong and real estate moves higher. But I am more of a realist and adding supply on top of supply-with demand dwindling, is NOTHING to be jumping up and down about. G-

Open port positions:

10/17/12 IWM short 1/3 @ 83.80
10/16/12 IWM short 1/3 @ 83.21
09/04/12 IWM short 1/3 @ 81.59

Recently closed

09/04/12 IWM short 1/3 @ 82.20 (closed 10/09/12 @ 82.57) -.37
09/06/12 IWM short 1/3 @ 83.11 (closed 09/25/12 @ 83.69) -.58
09/14/12 IWM short 1/3 @ 86.64 (closed 09/17/12 @ 85.80) +.84
09/10/12 IWM short 1/3 @ 84.27 (closed 09/11/12 @ 83.92) +.35

Full closed positions-click here

Bigger picture road map I am following

Click on charts to enlarge

60 minute timing system: Stochastics have rolled over from overbought levels and there is a clear sell signal bearish divergence in place. Odds of a pull back or hard drop are increasing greatly. Short term view Bearish-ER

60 Minute timing system (Time Frame-Short term)

Block Volume System: The block volume indicator has rolled over and there are some bearish divergences in place. We may get another pop up again, but there is no cash build up for a sustained move higher. Short term view Bearish-ER

Block Volume chart (Time Frame-Short term)

60 minute Chart Stochstics are starting to roll over and IWM is right ion the thick of resistance. I am expecting a pull back down to the 83.20 or even 82 in the coming days

IWM 60 minute chart

10/16/12 written report

2012-10-23T18:00:00.000-07:00

Hi Everyone,

Well, "the this market will never go down-you have to buy bulls", that were cheering for 1500 just 11 days ago-who then switched to you have to be defensive-just 3 days ago-are back to new highs are coming again. Fundamental cheerleaders are turning technical for their reason for new highs and all is well again. Maybe they are right and we get the move they are expecting. But there are some serious "differences" I see happening now than with the other drops.

Let's start with the bearish wave counters-who with every drop of more than 30 spx points-have stamped a P2 on their charts and expected the SPX to start the decline to zero. One of the biggest differences I see NOW-they all have wave 4's on their charts with wave 5 to the 1485-1500 on deck. Why is that important? Nobody is looking down-except for the commercial traders-who have one of the largest short position seen in the last 3 years.

Many are saying the drop is finished and now it is back to business for the bulls. The problem I am seeing-that 6 trading day drop did absolutely NOTHING to relieve the extreme bullish sentiment levels I watch. I am talking not even a dent. Everyone expected a PULLBACK and that was it-before we march higher. EVERYONE expected the support levels we hit yesterday to hold-and they did. What everybody is choosing to ignore-is the sell signal that was just generated TODAY on the NYSI. When this signal is triggered with bearish divergences-intermediate tops soon followed. You can see the chart below

Will this divergence trigger be different than the others and we just power higher? It might-but I do find it odd that both bulls and bears are expecting higher as this was triggered. It is NOT a we turn right now signal-but it is something that you better pay very close attention too-especially with the current road map looking lower into November.

Our short term timing systems are looking lower for Wednesday and if we push higher in early trading, I will use that strength to move to a full position on the short side for our port trades. If we head lower, we will manage the open trades and look to scale out at support. G-

Open port positions:

10/16/12 IWM short 1/3 @ 83.21
09/04/12 IWM short 1/3 @ 81.59

Recently closed

09/04/12 IWM short 1/3 @ 82.20 (closed 10/09/12 @ 82.57) -.37
09/06/12 IWM short 1/3 @ 83.11 (closed 09/25/12 @ 83.69) -.58
09/14/12 IWM short 1/3 @ 86.64 (closed 09/17/12 @ 85.80) +.84
09/10/12 IWM short 1/3 @ 84.27 (closed 09/11/12 @ 83.92) +.35

Full closed positions-click here

Bigger picture road map I am following

Click on charts to enlarge

60 minute timing system: Stochastics are now in overbought zone and trying to roll over. Hard to say if we have a bearish divergence or not-because IWM never went above the previous highs. There is definitely one with the spx. Short term view Bearish

60 Minute timing system (Time Frame-Short term)

Block Volume System: The block volume indicator is back in the extreme overbought zone. It started pulling back some today and it may still have a push up there-but when we see it in this area, a pull back or something bigger is usally not that far away. Short term view Bearish

Block Volume chart (Time Frame-Short term)

60 minute Chart Phase 1 of the potential inverted head/shoulders may have completed today. Phase 2 would be to make the right shoulder, which would call for a drop to close today's gap or even head down to the 82.15 area. If it holds, phase 3 would be a rally to the 85 area. Let's see if it follows the pattern. If it does follow this-we could actually see them try and form another inverted head/shoulders pattern from that level as well. The green circles would be how that would play out.

IWM 60 minute chart

08/30/12 free video report

2012-08-31T09:06:00.004-07:00

Folks-we are in the final stages of finishing the new site. The chat room will not be free anymore once we do our launch. There will be too many people in the room and these will be new members. We will be raising our rates and have a special plan-which I will explain at a later time.

If you want to lock into the $69.99 per month plan our the $500 per year, do so before we finish. Once it is complete-there is no turning back the clock with the new rates. The above video pretty much illustrates our ability to read these markets.

I wait for the swing trade set up-which comes after the whip saw and Jerome has been killing the much faster trades. You aren't going to get better readers of the market-then our trading team at Marketspath. We will not be in every trade and we will be wrong. But we aren't wrong much and the moves we miss-is because there was no trade set up.

Have a great weekend and click on the link below NOW to lock in our low rates. G-

http://www.marketspath.com/subscribepage.html

2012-08-29T17:59:00.001-07:00

Traders Continue to Wait for Bernanke to Speak

Market Recap:

SPX big winners were Sealed Air Corp (SEE) 10.5%, Wellpoint Inc (WLP) 7.28%, and Sears Holding Corp (SHLD) 4.52%. SPX big losers were First Solar Inc (FSLR) -5.86%, US Steel Corp (X) -3.03%, and Devry Inc (DV) -2.72%.

SPX five day big winners are Hudson City Bancorp Inc (HCBK) 10.96%, Sealed Air Corp (SEE) 8.24%, and J.C. Penney Company Inc (JCP) 7.5%. SPX five day big losers are Big Lots Inc (BIG) -21.65%, Alpha Natural Resources (ANR) -13.76%, and US Steel Corp (X) -13.%.

New Ten Day Highs: URBN, BXP, BF/B, CCL, CI, CCE, CL, CAG, STZ, COST, EMC, ESRX, FITB, FHN, FRX, GIS, HRS, HUM, HBAN, IGT, KR, LIFE, LOW, M, MHP, MWV, JCP, PCL, PFG, PLD, RTN, SNI, SEE, SHW, SBUX, SRCL, TLAB, TDC, TJX, USB, VTR, WAT, WLP, WY, AMZN, GOOG

New Ten Day Lows: ADBE, APD, AKS, ATI, ALL, AEE, ADI, APOL, AIZ, AVP, BHI, BLL, BMS, XL, BRK.B, CAT, CBG, CINF, CTAS, KO, CNX, ED, CSX, CMI, DE, DELL, XRAY, DV, D, RRD, DOW, DUK, ETN, EQT, EXC, EXPD, FE, FLIR, FLR, F, GPC, GT, HAL, HSP, TEG, INTC, ISRG, ITT, JEC, JNJ, CLF, LNC, LLTC, MAT, MDP, MET, MUR, NBR, NU, NUE, NYX, OXY, OI, PCAR, PH, PKI, PEG, PWR, RSG, COL, R, SLB, SRE, SO, LUV, SE, SWK, TE, TWX, TIE, TSS, UPS, X, JASO, UNM

Volume & Breadth Indicators

For the SPX Index there were 278 components advancing and 210 components declining. On the NYSE 3,113 issues were traded with 1,799 advancing issues and 1,175 retreating issues, a ratio of 1.53 to one advancing. There were 117 new highs and 23 new lows. The five day moving average of New Highs is 90 while the five day moving average of New Lows is 18 and the ten day moving average of Net Advancing is 134.

Advancing volume was higher at a ratio of 1.23 to one. The closing TRIN was 1.27 and the final tick was 168. The five day average of TRIN is 1.3 and the ten day average of TRIN is 1.06. The NYSE Composite Index lost -0.03% today while the SPX gained 0.08%.

For the NYSE, relative to the previous 30 session average, volume was -25.31% below the average. Of the last 15 sessions 0 sessions ended with volume greater than the previous rolling 30 day average volume. Of the last 30 sessions, 14 sessions ended on a positive tick, 6 of last 10. For the SPX, the day's volume was 63.2% of the average daily volume for the last year. Volume was 88.7% of the last 10 day average and 95.8% of the previous day’s volume.

Looking at the NYSE 15-second tick data, the total tick for the day was 99,000 and the average tick for the day was 64. There were 9 ticks greater than 600 and 1 ticks more extreme than -600. There were no ticks greater than 1000 and no ticks more extreme than -1000.

Moving Average and Support/Resistance Indicators:

58.8% of the SPX are above their five day moving average, 50% are above their 10 day average, 64.2% are above their 20 day moving average, 75.8% are above their 50 day moving average, and 63% are above their 200 day moving average.

There were no significant moving average crossovers today. Our moving average Power Rating is 79 of a possible 100.

Sectors on the Move:

Sectors stronger than the SPX for Wednesday:
- Basic Materials -- Outperformed the SPX by +30%.
- Financials -- Outperformed the SPX by +11%.
- Technology -- Outperformed the SPX by +14%.
- Health Care -- Outperformed the SPX by +19%.
- Consumer Discretionary -- Outperformed the SPX by +39%.

Sectors weaker than the SPX for Wednesday:
- Energy -- Underperformed the SPX by -69%.
- Industrials -- Underperformed the SPX by -4%.
- Consumer Staples -- Underperformed the SPX by -32%.
- Utilities -- Underperformed the SPX by -34%.

Checking the sectors of the SPX:
The Basic Materials sector had 17 advancing issues and 12 declining issues. 8 components are on an uptrend (2 new uptrends today) and 22 components are on a downtrend (1 new downtrends today.) The sector is on a Sell signal and closed below the daily pivot. The sector 5-Day average closed .02% above the 20-Day average.
The Energy sector had 12 advancing issues and 33 declining issues. 14 components are on an uptrend (3 new uptrends today) and 31 components are on a downtrend (7 new downtrends today.) The sector is on a Sell signal and closed below the daily pivot. The sector 5-Day average closed .25% above the 20-Day average.
The Financials sector had 44 advancing issues and 33 declining issues. 55 components are on an uptrend (11 new uptrends today) and 26 components are on a downtrend (6 new downtrends today.) The sector is on a Buy signal and closed above the daily pivot. The sector 5-Day average closed .73% above the 20-Day average.
The Industrials sector had 30 advancing issues and 28 declining issues. 22 components are on an uptrend (5 new uptrends today) and 38 components are on a downtrend (3 new downtrends today.) The sector is on a Sell signal and closed below the daily pivot. The sector 5-Day average closed .15% above the 20-Day average.
The four 'risk sectors' totaled 103 advancing issues and 106 declining issues today with 21 new uptrends and 17 new downtrends. 45.8% of Risk Sector components are uptrending.
The Technology sector had 54 advancing issues and 24 declining issues. 44 components are on an uptrend (8 new uptrends today) and 54 components are on a downtrend (1 new downtrends today.) The sector is on a Sell signal and closed above the daily pivot. The sector 5-Day average closed .99% above the 20-Day average.
The Consumer Staples sector had 21 advancing issues and 20 declining issues. 30 components are on an uptrend (1 new uptrends today) and 61 components are on a downtrend (1 new downtrends today.) The sector is on a Sell signal and closed below the daily pivot. The sector 5-Day average closed -.26% below the 20-Day average.
The Utilities sector had 12 advancing issues and 17 declining issues. 5 components are on an uptrend (2 new uptrends today) and 68 components are on a downtrend (1 new downtrends today.) The sector is on a Buy signal and closed below the daily pivot. The sector 5-Day average closed -1.56% below the 20-Day average.
The Health Care sector had 34 advancing issues and 18 declining issues. 35 components are on an uptrend (8 new uptrends today) and 75 components are on a downtrend (no new downtrends today.) The sector is on a Buy signal and closed above the daily pivot. The sector 5-Day average closed .26% above the 20-Day average.
The Consumer Discretionary sector had 54 advancing issues and 25 declining issues. 51 components are on an uptrend (6 new uptrends today) and 83 components are on a downtrend (4 new downtrends today.) The sector is on a Buy signal and closed above the daily pivot. The sector 5-Day average closed .93% above the 20-Day average.
Based on the SPX sector data, we are on a Sell for the SPX and the Russell 2000.

What We Learned from Wednesday's Action:

Wednesday was session 3 to close above the 5 DMA, session 3 to close below the 10 DMA, session 25 to close above the 20 DMA, and session 34 to close above the 50 DMA. This was also session 23 for the 5 DMA to close above the 20 DMA. One early sign of a sustainable rally or pullback is often a close above or below the 10 DMA. The SPX closed 1.7 points below the 10 DMA.

The SPX 5 DMA is 1408.69, 10 DMA is 1412.19, 20 DMA is 1404.9, 50 DMA is 1374.03, 100 DMA is 1360.23, and 200 DMA is 1336.42.

On Wednesday the SPX traded both below and above the opening range. 52.8% of the SPX closed up from the previous close; 53.6% closed higher than the open. During Wednesday's session the SPX gained 1.17 points from open to close. The SPX intraday trading range was 7.53 points. The 5-Day average intraday trading range is 9.39 points, the 10-Day average is 9.51 points, and the 20-Day average is 9.26 points. The trading range is contracting. The 5-Day SPX gain is -0.21%, the 10-Day gain is 0.35%, and the 15-Day gain is 0.59%.

Note: The Opening Range Breakout is one of the simplest day trading set-ups to understand. The first hour of the trading day is the most volatile. Bears and bulls are battling it out in the stock market, trying to show you who’s going to be in charge for the day. If we break out of that trading range, it's telling us that new buying or selling is impacting traders' assessments of value. Looking back at today’s breakouts also helps us grasp sentiment going forward because when a clear trend is established it often carries through for several sessions.

Looking Ahead:

The Market Environment for Thursday is -2. Greater than three is bullish and less than negative three is bearish. The short-term trend appears to be sideways. Mel's 5-Day Oscillator is 28 and Mel's 10-Day Oscillator is 45 (below 35 is oversold and above 65 is overbought.) Based solely on the technicals, our bias is slightly bearish for Thursday's session.

This remains a tough market to trade. We closed our 8% of account value TNA hedge today, in yesterday at $56.40 and out today at $57.95 for a +2.75% gain. For a hedge, this worked very well as our exit today was just three cents off the high of the session. We know many traders find it difficult to enter a long side trade when we are looking for lower prices but we did a similar successful move last week when we dumped three layers of SPXU at breakeven in order to step aside and let the rally move by us before re-loading some on the short-side. We find maneuvers such as this extremely useful and protect us as much as possible from being wrong too long.

Overall, this was yet another session that did very little to change any technicals. Eleven of the last fifteen sessions have seen the SPX move only three points or less, pretty much freezing the technicals in place. This is a market that wants to go lower but the hopes of additional QE from Jackson Hole just won't allow it yet.

Our Market Internals data remains with a Bearish bias but market breadth has been outperforming the SPX this week and we are watching that closely.

Thursday, August 30

Economics
08:30 Initial Jobless Claims – consensus 370K, prior 372K
08:30 Continuing Claims – consensus 3306K, prior 3317K
08:30 Personal Income - consensus 0.3%, prior 0.3%
08:30 Personal Spending - consensus 0.5%, prior 0.0%
08:30 PCE Deflator - consensus 1.4%, prior 1.5%
08:30 PCE Core - consensus 1.7%, prior 1.8%
11:00 Kansas City Fed - consensus 0, prior 5
11:00 Fed buying $1.5b-$2b Treasuries in 25 to 30-year range
1:00 Treasury selling $29b 7-year notes
01:00 NZD NBNZ Business Confidence
07:55 EUR German Unemployment Change
08:30 GBP Net Consumer Credit
09:00 EUR Eurozone Consumer Confidence
23:30 JPY Household Spending
23:30 JPY CPI
10:00 Italy to sell bonds (floating, zero coupon)

Earnings
Before:
Ciena (CIEN) EPS -2c

GDP rose 1.7%, in line with expectations. Pending home sales rose 2.4%, more than the expected 1.0%. Oil inventories added 3.8 million barrels. Last week they lost 5.4 million. On Thursday we will get initial jobless claims and personal income.

Thank you for reading. Think on it, trade on it, and be well.

-----------

"Mel"
http://www.advicetrade.com/
http://melsinfo.com/
http://www.marketspath.com/

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Continue to fight. We do not fight alone. Continue to live.

Free Trading Room Link

2012-08-21T12:01:00.002-07:00

Below is the free trading room link. Enjoy G-

http://www.marketspath.com/001freetradingroom.html

04/02/12 Free Written Report

2012-04-02T17:38:00.001-07:00

The bulls have been in complete control of this market since December. I can go on and on about why this market will move lower, but the truth is, the market will go down when it is ready to go down. Does that mean I think this market will just continue higher? No, not at all!! Have I been early with when I thought the market would roll over? Absolutely! If I was to think this would be the last time I will be wrong with the markets, that would just be foolish. It is not the first time and it will not be the last time.

But maybe the bulls who believe the Fed will never let this market down, are being just as foolish. I have read over and over that NOW is the best time to buy stocks when comparing them to bonds. In a normal free market, I would NOT have a leg to stand on arguing against that thinking. Normally, when bonds are at these levels, money will leave them for riskier assets like the stock market, which would normally move the stock market higher.

But there is a problem with this thinking. Bonds are at these levels, because the Fed has to KEEP them at these levels. If money starts leaving bonds to jump into the stock market, interest rates will sky rocket. There is a somewhere in the range of a 300 trillion dollar derivative trade that is held by our 5 largest banks. which are tied to interest rates staying low. So how can the money leave the bond market and fly into the stock market, without blowing up out 5 major banks? Another issue with the belief that money is going to come from the bond market and into the stock market, is the people who are invested in bonds and their age. Any financial adviser knows the ratio for bonds to stocks, which depends on age.

Many people who are invested in bonds are entering or already in their retirement years. To leave bonds and jump into risk assets, is usually not on their minds. Return of investor is sometimes more important than return on investment. So for every talk head that comes out and says stocks are cheap compared to bonds, I say "be careful what they wish for" as Ben has a much more important purpose here-and it is NOT the stock market!! It is to keep interest rates at low levels-NO MATTER what it takes. If he fails, there is a very good chance we will see our banking system as well as the world's banking system blow up in smoke.

Some believe qe3 is going to be the next thing to lift the stock market even higher. We saw the stock market jump some 1% last week when he mentioned he had the qe3 bazooka in his pocket. Would our Fed chairman dare to launch qe3 with commodity prices where they are? If he did, we would see oil shoot up to 150-200 and gas most likely spike to $6 a gallon. My guess, he would see inflation coming around the corner so fast, he would pull the plug before he even was able to launch any type of qe3.

So no, I do not believe that is even close to being in the same room as the table some think it is on right now. We are now in a situation where the talk of more quantitative easing has lifted the indexes back to levels right at the previous bubbles.