Mind this One, too.
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Doesn’t it just seem like this tape is chock full of momentous milestones? Not to bore you, but it seems like they keep coming, three a day — fire, flood and poor draft picks alike.
Sorry, that last was a shot at former NY Giant GM, Ernie Accorsi, long may his toupee moulder. I’ll speak no more of trading the largely mobile and quick thinking Phillip Rivers for the clubfoot, Eli Manning, hurler of rookie interceptions deep into his sixth year on the job.
I’m not bitter, I swear.
But back to the momentous event of the day. I like to call it “The Intercession of the Magic Gap.” Back in the early days of October, 2008, when this whole gerbil basket of a market was falling to the feral cats, we had a Friday-Monday gap on the [[SPY]] of some significance. It’s illustrated below:
As you may recall, it got quite ugly after that. However, the reason I illustrate this gap today is that I believe it’s serving as quite the psychological barrier for our market participants.
Those bears, beaten and stripped of their 10k Rolex’s and cashmere mittens have long recognized this fillip as the “enough is enough” Maginot Line. They believe this is where they can stand athwart history and cry “Stop!” in full W.F. Buckley (R.I.P.) mode.
The bulls on the other hand, see this as a natural accelerant. Like Right Guard aerosol on the open campfire, they know this region of “free air” should propel this bull even farther and higher once breached for good. And to their credit, that was the case this October 14th and 15th, when we zoomed through that gap like a hot canoli through marzipan.
However, it seems that our gap has acted as something of a “CAP” upon reaching the north end. Note we did exceed the roof, but not by much:
And my thinking is that this, too, is to be expected, as is today’s test of the uptrend line (also marked on the above chart).
In fact, if I’m correct here, we are just consolidating this momentous level, and we should bounce off our long term trend line here on our way to the 1150-1180 range, where we’ll find our next consolidation point. Here’s the BIG PICTURE I’m looking at, including “Gap/Cap:”
The great thing is, if I’m incorrect, you’ll have two things to give me yellow parsnip grief over — the Giant loss, and the Bull loss.
But we’ll know soon enough, won’t we?
Ciao for now, and Go Junkees!
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Aside — This is AWESOME… (gotta love youtube):
[youtube:http://www.youtube.com/watch?v=6KR2CiceeWg 450 300] If you enjoy the content at iBankCoin, please follow us on Twitter
He lives. Hope you had a good weekend, and I love the cartoon.
Any plans to hedge your downside then?
Only if we break that uptrend line on the daily.
It’s at 106.68, btw and our low of the day is, thus far, 106.69.
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Just saw 106.64 …..
Low as 106.61, actually.
Closed at 106.90.
Close is what counts.
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You were missed. thx for analysis and the youtube vid is hilarious
Harry Morgan (Sherman T. Potter) is still alive at 94!! (There’s hope for The Fly.)
http://en.wikipedia.org/wiki/Harry_Morgan
http://en.wikipedia.org/wiki/Sherman_T._Potter
94, God bless. He was pretty hard-ass even in that libby claptrap 70’s television show, M*A*S*H that Purdy’s mama made him watch as a child.
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Jake, what sort of a range do you think the market will trade in over the next few years? What about shorter term? What chance do we have of hitting the 2007 highs or the March lows in your opinion (and when)? I’d like to here your big picture market analysis. Thanks for the great work.
I think we may be in another cyclical upturn here in the midst of a longer term bear.
I really think the Obama health care legislation’s fate will have a lot to do with where we head in the near term.
Unemployment will head halfway to 20% if that garbagio gets passed. If the socialists manage to get Cap & Tax passed through the Senate, we’re in considerable trouble.
I hold out more chance for the former than the latter, however.
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Jake: These guys had the same Gap idea:
http://www.stocktiming.com/Monday-DailyMarketUpdate.htm
Ach! I tend to disagree with everything those guys print, so I am someone nervous that they are typing on the same subject.
What’s good is that they seem to have reached the opposite conclusion, and they do not incorporate the uptrend line.
Much to their chagrin.
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Yep the bears are making a run on that support line. And the line is stubborn and holding….
http://www.youtube.com/watch?v=8k8Lj-cV7Ls&feature=player_profilepage
Yipes. War is hell, no?
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Awesome movie – gotta love Paul
Never saw it. I note it was about brave Canuckistanians. Bravo.
Query: Isn’t it a hate crime in Canada to make movies about war?
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Seems there are a lot of people playing on that trendline you are talking about Jake ;
http://www.financialsense.com/editorials/swenlin/2009/1023.html
As for hate crime stuff, well we have a law similar to the one that is maybe about to passed in the US but here lately it has been taking a beating with major defeats in courts because it restricts too much freedom of expression.
As for war, yep it’s hell all right. My father was a WWII vet. The old soldier left us 6 months ago.
My condolences. God bless him… He has.
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Good stuff Jake. Sorry about your Giants, I think the Superbowl Saints destroyed their soul.
Cannot believe the Aints dug themselves out of that hole yesterday.
They still have to perform in cold weather. It will be interesting to see if they pass that test.
Manning can be bad in any weather, on the other hand.
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Is the existance of the post-Lehman gap supposed to be news???
Anyway, in light of your video and cartoon selections, it is clear that you continue to suffer from Obama Derangement Syndrome. You would have have more cred in criticizing Obama’s moralizing and fiscal hole digging if you weren’t too deluded to see those same things in GWB. Do you know what the long-term costs of the wars and of GWB’s Part D giveaway will be? Turn off the Dragnet re-runs and unplug your fat buddy Rush. Learn about what is happening in the real world.
Thanks for your knee-jerk, all too predictable reactions, Senor Commie.
“Purdy” will be playing my dumb straight man today through next Saturday, ladies and gents.
If you’ve heard all the regular dimwit Bush doperies, and/or are gulled by an inordinate misunderstanding of classical economics, you might want to gloss his “parts” over.
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Ha!
Too easy.
Rush is not the lone voice of conservatives, champ. In fact, he gives me a headache. Moreover, how do the previous eight years condone the present?
Obama and the Democrats have already spent more than the combined costs of the War on Terror and the deficits of the past decade. And they succeeded in doing it in less than 1/10th the time.
It is amazing how you people spout this stuff. Did you pull those stats out of your ass? Factor in the cost of the wars, include the cost of caring for disabled vets for life, include the Part D giveaway to the drug companies, include TARP – and it is not even close. The Dems suck too and are listening to the same crooks that screwed up our economy under the idiot Bush – but don’t fall into little man Jake’s massive blind spot where he feels that he has to believe that one guy (GWB) is god and the black guy’s the devil.
P-man – Honestly, you’re not a little disappointed in the President”s performance?
Yes, I’m disappointed – – but not too shocked. It takes a very clueful and courageous person to stand up to entrenched powers and, when one party controls both the executive and legislative branches, his own party.
Obama showed courage when he stood up publicly against the Iraq war when morons like Jake were being encouraged by the idiot Bush to call those of us who spoke the truth, traitors. But, as regards economics, Obama appears either clueless, gnad-less, or both.
BTW, I didn’t vote for Obama. (Apologies to Jake for not neatly fitting into one of his slots.)
Angela Davis was probably still on your ticket.
Who cares whom you voted for? You strut for one of the worst Senators, and one of the worst Presidents perhaps in US history, given relative agendas.
Granted, Carter was bad, but not as “audacious.” McGovern would have been this bad, but the American people given two poor choices, at least didn’t pick the worst THAT time.
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You really are clueless. Obama “stood up” against the war because he’s a retro-commie, and he plays everything according to that script. If you recall, you commies didn’t want to war against Hitler either, until he attacked Stalin.
That changed things in a hurry.
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Purdy, you are your own worst enemy. How many stupid straw men can you construct before you’ve eroded even the tiniest shreds of credibility?
Bush is “my god?”
LOL. Get a life, commie.
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Jake – Welcome back. My condolences on the Giants. It looks like it may be a long season. Still hangin’ with the TBT, but watching the auctions carefully.
Yes, ANDE And TBT were my only shining stars today.
MON And SLW were bludgeoned.
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Jake, what about the story that I saw today about the massive short interest in silver – the metal? I own some SLV and SLW and am considering taking profit in my gold miner and buying more in the silver arena.
There’s always a massive short on silver. It’s a permanant condition in the CBOT.
Do you have a link to your specific story?
I wouldn’t sell PM’s here… not with that reactionary dropoff today. Should get a bounce off that.
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The short interest info is at http://www.investmentrarities.com under the Butler comments.
I click on Butler and all I get is an ad for his letter.
I am familiar w. the COT report if that’s what you are talking about. The Blees rating has been abysmal for months.
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Sorry, it is on the left side under the most important factor in the price of silver – Ted Butler writes about the Coming Accident in the Silver Market. The amount of shorts is greater than in any other commodity – in history. BTW, does SLW give any currency protection? It is Canadian but SLW is on an American exchange.
Yeah, it does because somewhat as it’s denominated in Loonies. As you can see, it’s remained quite strong here.
A giant short position in silver means nothing but a harsher cover.
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Great post jake.
Jake,
Are you holding any GFI? It appears to be stuck at major resistance
Is a drop down to the 100 day MA probable?
Or is this “it” for the precious metal play for the time being while the USD rallies?
Thanks very much
I still like GFI but it’s “right on” the trend line that started at the October 24th 2008 lows and it also failed the 61.8% fibonacci line, so yeah, we could be in for some consolidation here.
I’m not selling mine, however. Not till after Christmas at least.
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