This morning another poor CPI report was issued by the Bureau of Unicorns and Statistics and immediately the S&P futures reversed by over 100 points. As the market opened it appeared that with the 10 year Treasury above 4% and indices cratering that finally the big capitulation and super duper oversold conditions would be achieved.
The ECB injected the pump and dump rumor of the day into the market by basically saying that they prefer hyperinflation instead of containing the problem. I would not put too much stock however into anything the ECB says as their member nations are instructing citizens to make clay heating pots and burn dung to keep warm this winter.
So after the ECB rumor hit the markets the candle was lit and off to the races the markets went, producing a rare candle sighting:
I used the six month version first with Bollinger Bands so my readers can see that while impressive, the “Bernanke Roman Candle” will burn out as there was very little commitment outside of the PPT to keeping this sucker going. A failure to close above 3735 tomorrow and any rollover will spell a new level of fear and doom for markets as the smart money prepares for a bond disaster that is still in the making.
The one year chart is not inspiring:
If the markets break below 3500 on a closing basis with more volume than today’s move, all bets are off.
I’m done for the evening, off to get a neck brace after watching this chart and meeting with my Mom’s doctors all days. I don’t know which hurts worse, my wallet or my neck.