The bilious septic tank that is Trump's crime-riddled business life is backing up into the White House, while copious useful idiots shred their credibility lying non-stop in defense of criminality. Trump is the sum total endgame for decades of Banana Republican fraud and failure. To say that history won't be kind, is a ludicrous understatement. The ill-fated reign of I, Clownius aka. "The Joker" is coming to a most ignominious ending. Proving my caveat: humility or humiliation, choose one...
"One minute I held the key
Next the walls were closed on me
And I discovered that my castles stand
Upon pillars of salt and pillars of sand"
Way back in September 2008, markets tanked after the Lehman bankruptcy but then stabilized as policymakers scrambled to conjure up a bailout. The market rallied hard into the October TARP vote, and then collapsed once it finally passed. Just like this imaginary trade deal, it was too little, too late...
"It was all going so well"
The only thing holding this market up right now are weak handed bears covering their shorts. Things are so bad right now with the economy and earnings that shorting this market has now become the consensus hedge fund trade. Which ironically has held the casino aloft even as major institutions sell major amounts of stock. Be that as it may, here we see via retail positioning, that each high in the market is attended by weaker and weaker sentiment. This is a tired market.
The current peak in sentiment matches the peak from last December:
80% of trading is now carried out by computers with artificial intelligence. The rest is carried out by humans with artificial intelligence.
Like today's zombies, computers don't care about valuations or P/E ratios. These are technically driven cybernetic organisms that are almost entirely momentum driven.
Which is what makes them so dangerous. Whatever direction the market is heading in, they exacerbate the move. They excel at steamrolling weak-conviction bears, as they are doing today ahead of the fake trade deal.
Like most people we know, computer algos will believe anything and anyone - even Donald Trump. Which is why they keep falling for the exact same lie over and over again. This is the 13th round of trade talks in 18 months, for anyone keeping track at home.
The Dow and S&P are the same - three wave corrective at two degrees of trend.
A cascading waterfall crash in real-time. Bought with both hands (lower pane):
"Believe me. Good things are almost beginning to happen soon"
The Nasdaq is weaker than the Dow and S&P. Notice the index double tagged the 200 day before breaking above the 50 dma (blue line), at wave 2 (red). That is called a "running flat" in Elliot Wave parlance. Sign of a very weak bounce in which a and c waves both have the same origin.
Within Tech, internets are the weakest - FANG stocks in particular (Facebook, Amazon, Netflix, Google).
All are being investigated globally and fined repeatedly for crimes related to fucking up society.
Notice correlation in the lower pane. For the past year, these stocks have been machine precision correlated to the S&P.
Here is oil as of yesterday's close:
Herein lies the problem, this is the largest coordinated central bank bailout since 2009 - larger than 2016.
Yet as we see, neither commodities nor deflation have rallied.
It's a failed bailout. Monetary policy is no longer affecting the underlying economy.
Gamblers have bought recession with both hands.
The inconvenient truth, ignored by all-knowing zombies, is that the bull market ended a year ago. Only a fraction of stocks have made new all time highs in that timeframe - almost entirely recession stocks, software stocks, and recent IPO junk.
Here we see the average U.S. stock versus the S&P 500.
Only algos could achieve this kind of black magic:
Here we see the two year Russell 2000 top is essentially complete
Dow Transports left the party a year ago. Which means that Dow theory never confirmed the most recent Dow highs in 2019.
Which is why the divergence between rails and trucking is the widest since October 2008:
Be that as it may, even the rails are rolling over now:
Very few stocks making new highs today. Discount retailers however are having a great run. Because that's all people can afford nowadays.
Why go out when you can stay home and enjoy cheap tequila on the linoleum?
