Let's make a deal its a win win...Overbought day 2

The Greek bonds took a 50% haircut and the Euro rallied enough to pay for the cut. The whole world was short the Euro and the situation was hopeless. Of course, these Euro bonds were sold in Euros during the crisis at the very time that the US was selling their bonds at auction in August at premium prices.  The dollar was in a strong uptrend and the Euro was being heavily shorted and sold.

That is when the central bankers are at their best. Once again for the umpteenth time they save the day by forcing the shorts to capitulate. Today was the capper on a 1600 point rally in 3 weeks. They were also able to trash the US bonds that they sold 2 months ago when Europe was in trouble. 

My guess is their next act is to create a crisis for US debt and by association the US Dollar so they can pull this same slight of hand trick for the US. Stay tuned for the incredible US debt crisis coming to you soon.   This is the way they profit from misery. The central bankers are trading off one crisis to another. The next crisis will be in the US as the balancing the budget gang argues to the "brink" of destruction and US rates rise and bonds sink. That will create another opportunity to do it all over again.

This rally has produced day 2 of overbought numbers Mikey5 is 160, Mikey 10 is 157 and Mikey 20 is 149. Puts fell to .86 which is still not low enough for a sell off and the Mikey LT rose to 58 a new high on this move but needs to get to the 80's to be overbought.
Mikey


Closing Prices

US Stock Indexes
DJIA 12208.55 +339.51 S/P 500 1284.59 +42.59
NYSE Comp 7813.99 +307.84 NASDAQ 2738.63 +87.96
S/P Midcap 912.99 +37.68 Russell 765.43 +38.23  
DJT 5025.09 +215.93  DJU 457.20 +9.59  
US bonds and interest rates
US Gov rates: 6 mo .0661%  2 yr .3049% 5 Yr  1.179 10 yr 2.36 30 yr 3.42
IEF (US10 yr) 101.70 -1.07 TLT (USLT)112.51 -1.66
MUB (NatlMuni)105.92 -.31  CalMuni (NCA)8.97 +.01
Preferred (PFF)37.69 +.72 HYG (High Yield)90.49 +1.41
BND Total Bond Index 83.27 -.11
Commodities
Commodities Indexes (DBC)28.18 +.64 (USCI ) 62.35 +1.27  
Gold 1747.70 +47.30 Silver 35.12 +1.93 Copper 3.69 +.27
Platinum 1641.40 +71.60 Nickel (JJN)28.77 +.15 
Oil 93.12 -.05 RBOB 2.73 +.03 Nat Gas 3.76 +.10
Grains (JJG) 46.32 +1.03 Livestock (COW)38.40 -.29
Cotton (BAL)64.69 +2.84 Agg complex(JJA)56.03 +1.35
US Dollar Index and World Currencies
Euro 1.4149 +.0295 Pound 1.5977 +.0129 Swiss Franc 1.1484 +.0270
Yen 1.2978 +.0054 Aussie 1.0752 +.0316
Dollar Index 75.01 -.84  
World Debt markets
BWX(Intl Treas)62.12 +.69  PCY(EmerMkt) 27.53 +.30 IBND(Intl Corp) 34.32 +.49

All Markets Current Trends

World debt markets

US Bonds: 10-27 current trend down
US Natl Muni Markets:: 10-27 current trend down
Intl Treas Bonds 10-27 current trend up
Intl Corp Bonds 10-27 current trend up

Emerging Markets Debt: 10-27 current trend neutral
US High Yield 10-21 current trend up
US Preferred Stocks 10-27 current trend up

Commodities

Commodity index (Broad based) 9-12 current trend neutral
Gold: .10-27 current trend neutral 
Silver: 9-22 current trend down
Copper 8-8 current trend neutral

Platinum 9-19 current trend down
Palladium 9-7  current trend down

Nickel 10-27  current trend neutral
Grain complex 9-19 current trend down   

Sugar 10-21 current trend neutral
Cotton 10-21 current trend down
Livestock 9-27 current trend up
Coffee 9-21 current trend down

Lumber 9-23 current trend down
Agg complex 9-16 current trend down

Oil 10-18 current trend up
Gasoline 10-27 current trend up
Natural Gas 7-28 current trend down

World Stock markets

US Stocks: 10-11 current trend up
Europe 10-14 current trend up
China: 10-26  current trend up
Brazil 10-24  current trend up
Japan 10-27 current trend up
India 10-27 current trend up
Russia 10-27 current trend neutral \

Emerging Markets: 10-26 current trend up
Total world markets 10-24 current trend up 

Currencies markets

US Dollar Index 10-21  current trend down
Aussie Dollar 10-24 current trend up  
Euro 10-27 current trend up
Brit Pd  10-27   current trend up
Swiss Franc: 10-27  current trend neutral  
Jap Yen 10-21 current trend up
Canadian Dollar 10-27 current trend up

Mexican Peso 8-3 current trend down
Brazilian Real 10-27 current trend neutral
Indian Rupe 8-9 current trend down

Trend changes:

World Stocks: Japan, India, Russia to up
Currencies: Euro, Brit Pd, Canadian $ to up, Swiss Franc and Brazil real to neutral
Commodities: Nickel and Gold to neutral
World Debt : Intl treasury to neutral, Emerging markets debt to neutral


Intermediate Term Trends
Changes 10-21 Dollar to down and US stocks to neutral

Oil: Down
Gold: Up correcting
Silver: Down
Commodities: Down
US Bonds: Up
World Bonds: Down
Emerging Debt: Down
Emerging Markets: Down
Dollar: down
World Stocks: Down 
US Stocks Neutral


US Stock Market Trends

Mikey Short term up  10-13 11478

Mikey Intermediate Trend: Neutral   10-21 11808
Mikey Long term Neutral 8-4-11 11779
NYSE 10-14 Current trend up 

NASDAQ 10-11 Current trend up
DJ Utilities: Current trend up
Transports:10-14 current trend up
Russell 2000: 10-14 current trend up   

IBD :10-12  Market in confirmed uptrend 11518

US markets short term technical trading indicators:

Mikey5 +160 Mikey10 +157 Mikey20 +149(-125 OS, 0 Neutral,  125 OB)

VIX (OB 10 - OS 40) 25.48,VXZ 58.02
Mikey Int OB/OS index (80 OB 20 OS)+58
Put/Call Ratio .86 10 day average .94
Ratio Put Premiums to Call Premium (.34 to 2.5) .98 10 day ave .92
Mutual Fund Purchase/Redemptions ( 1.5 to .66) .92
Stocastic Fast D 10 day 88.23 Weekly 61.45
Bulls 40 Bears 37.9  Bull/Bear ratio 1.06 (new)
Daily DJIA MACD  +198.57  Rising/ Positive cross 10-6
Weekly MACD --116.06  Rising/Positive cross 10-24
NYSE New Highs 172(12/7-10 429) New Lows (8-8-11 1345 ) 10
NASDAQ New Highs 110 (12-7-10, 352 ) New Lows 24 ( 10-4-11, 755 )

Advance/Declines

Daily NYSE Advance-Decline +2317 Nasdaq Advance-Decline +1686
Daily Mikey A/D line NYSE (7-7 37567) (8-8 19199) 33987  
Daily Mikey A/D line NASDAQ (2-18 10095) (10-3-10-15390) -5995 
5 day AD NYSE +6390 NASDAQ +4229 NYSE..(OB +4000 OS -4000)
10 day AD NYSE +7872(5000 OB-5000 OS) 20 day +10460 (+7000 OB -7000 OS)
% above 200 day ave  41%

below 50% indicates intermediate trend down

Days to option expiration 22


DJI Moving Averages

5 day 11901  up / Price above
20 day 11428 up/ Price above

50 day 11292 up/Price above
90 day 11645 Down/Price above
200 day 11970 Flat / Price above
20 week 11659 down/Price above

50 week 11879  up/Price above
90 week 11301 Flat Price/above
200 week 10626 Down / Price above

Daily comments for last 30 days:

9-26 The DJI held the 200 week for the forth time since August 8th and ralliedalliedralliedallied 272 points.  I think the shorts have to make a decision here to cover or hold. The talk I have heard leads me to believe that the lows are going to break. The market rallied with the announcement in EUROPE on a deal to bailout the banks similar to the TARP agreement.

9-27 Stocks and commodities rallied as some air was let out of the recent dollar rally. We are at the end of the quarter and this rally maybe just the window dressing the system needs to show the 401K plans that things are not that bad. This happened at the end of last quarter. Bonds along with the dollar took it on the chin today. The trend is still down on all asset classes. The dive into the end of the quarter would have been a good thing if you are looking for a low
9-28 Oil and Gasoline looks like it could cave in. Copper Silver and Platinum are the most recent casualties of the dollar rally and the soft world economy. Stocks today dropped 179.99 and resumed their decline and I believe at some point have another leg down. My indicators are slightly oversold but puts ran at a hefty 1.30 today and the VIX was over 40. Normally when the VIX runs at 40 either the sell off is over or we enter a crash phase. The path of least resistance is still down.
9-29 Good GDP numbers released and the market rallied. I will not comment on those numbers or any other because they are not only subject to revision but they make them up. I have learned that figuring out the real economy is just a pain in the ass. It will not make you any money and just cause you to attach to the wrong thing which is the story. Keep focused on the price if you want to trade and not the Alice in wonderland numbers they system makes up. Today was an up day for what ever reason and the trend is still down. Apple (390) looks very toppy to me and many of the leadership stocks have been nailed a move to 340 would not surprise me.
9-30 End of Qtr closes down 240 near long term support.
10-3 The averages closed right on the edge of the cliff today. The support of the 200 week is at 10662 and the DJI closed at 10655. The brokers and banks are acting just like they did in Sept 2008 when we had the credit meltdown. Long term US bonds closed higher that they did in 2009 and yields are at their lowest levels at 2.74. The market is now at a 52 week low and has wiped out QE2 and is working on QE1 from June of 2010 which started at 10300 in July. That is the result of fake money being pumped in by the Fed to save the banks and corporations. Gold and silver was also aided by this pump and its day is coming too.
10-4 The risk trade awoke today just in time to save the DJI from breaking down. Its a good thing for the market makers because there have been a lot of puts bought and they would have been on the hook. The truth is that 95 out of 100 of these the puts lose just like they did today. They must first make this 10600 level unimportant and then it can break. The threat to the puts is the Fed and Bernanke was out rattling the sword today. The municipal bond market took a hit today with the National fund and the California funds trends turning for up to neutral. Keep your eyes on these trends because the way the banks and brokers are trading credit quality may be a concern and these markets could get ugly with out Federal support.
10-5 The 200 week is the line between a long term uptrend and a long term downtrend. It is an important line and the traders are watching it. The shorts got too excited this last week and the "risk traders" (you know who) pulled it back above the line. The market internals still show an oversold market and the puts got some religion today with Put/Calls running at a calmer .86. It looks to me that they want to stair step this down trend a little at a time.
10-6 Stocks and commodities edged higher on the lower dollar today. The 50 day average on the DJI is at 11262 or about 30 points above the current close. The average is falling so the odds favor the market meeting resistance in that area. The intermediate trend is down and for it to turn up the DJI would have to get above 12000.
10-7 Jobs sell off
10-10 300 point fix Europe rally dollar tanks but gold rallies
10-11 Nearing the top of a trading range. Current trend changed to neutral

10-12 counter trend rally continues IBD calls market in uptrend
10-13 Daily MACD turns positive
10-18 The central banks held the line at the 200 week average over the past 2 weeks and once again the DJI is at the top of a trading range. The support area is now the 50 day average at 11215 which contained the yesterdays sell off. The 20 week is now the resistance area at 11649
10-19  The top end of a trading range and the lower end or breakout in the dollar are holding at these levels. The Mikey 5 is just above the zero line and the Mikey 10 is still an over bought 114. This indicates some near term weakness in creeping into this last 2 week rally..
10-21 The intermediate term was upgraded to neutral and the current trend is still up. Stocks break out above the top of their trading range of 11600 close at 11808
10-24 All three Mikey indicators are overbought. The Mikey5 is at 38, the Mikey10 is at 144 and the Mikey20 is at 136. This is unusual and the last time it happened was July 7 and that was a top. The trends are turning positive for world markets. Brazil current trend is now up along with the total world markets indicator. US bonds are now in current trend down and joined its buddy the dollar. I believe these changes are temporary but the trends must be honored.
10-25 another day another almost solved European crisis another dollar down day  160 points. Ho hum
10-27 Euro Deal made stocks rally World stocks turn up US bonds and dollar in downtrend