Support & Resistance Levels for multiple time-frames on the Cash Index on the annotated charts below. (Click on graphs to enlarge. May need to click a few times to get to full size) Current Hooper Levels for the DAX.
Technical Trading Charts & Levels for S&P, Euro, 10 Year Note & 30 Year Bond are in Hooper’s subscription portion of thecontrariancorner.com
Germany DAX 9:00 GMT
Back in the days before Greenspan was on the cover of TIME, one of the few great CB moves he made came through the pipes. In a radical move at the time, Greenspan injected himself into the fiscal debate in Congress. In mumbling and dire tones the Great One described the impending market melting crisis that the budget had set us on. Graham-Rudman was the Simpson/Bowles of its day and heralded as a “must do.”
In reality, Greenspan was convinced that technology, quality and Chinese production were going to push down on US inflation rates. Greenspan was known to quiz students as to “What causes inflation?” Myriad answers were met with grumbling “No’s.” To him, excess government spending caused inflation. Certainly not the mistakes of the very institution he chaired. Thus evolved the quid pro quo that all denied. The man had given senior Congressional leaders assurances that if they moved on the budget, he would grease the economy with rate cuts.
Fast forward to today. Walking the knife’s edge of a debt depression, Bernanke has elected to use the hallucinogen of negative real rates to prop up the system. His balance sheet and the budget have expanded as everyone else has been wound down. The crisis de jour is the silliness nick -named “The Fiscal Cliff.” Just total up all the programs and tax breaks allegedly ending and subtract from already anemic GDP. Ooh scary, avert your eyes. Something called the Tea Party says this would be “good.” If that’s true then why all the trepidation? To this posts point: Why wouldn’t Bernanke assure a deal like Greenspan’s? If the Fed is doing something so heinous, why wouldn’t Congress say, “Back off and we’ll hold up the budget?” There’s a glaring example of tightening credit AND harsh budgetary adjustment available..it used to be called Europe.
We don’t rant from trading pits or intellectually brow beat from the Op-Ed pages of the few remaining dailies. We do know this, it isn’t that difficult to navigate the choices. The citizens of the US have the Constitutional right to be horribly wrong about their priorities. Many of our problems are the result of that fact. We may be on the verge of doing it again.
click to enlarge.
The equity market – as represented by the SP future – has been reacting to financial sytem stress, and its calming, since Nov of last year. There are far sexier products to monitor stress but the trusty old EDZ12 contractshown here, remains a valuable compass. A combined rate of the first 4 Eurodollar contracts, called the White Pak, is a great product.
One takeaway became evident in the consolidation CBs like to call stability. Equity prices also moved sideways. This shows the market had discounted incredible earnings and was looking for more CB “juice.”
If/when EDZ12 returns to the low 99.50s, it will be interesting to note whether equity can do better than what we’ve already seen.
Support & Resistance Levels for multiple time-frames on the Cash Index on the annotated charts below. (Click on graphs to enlarge. May need to click a few times to get to full size) Current Hooper Levels for the DAX.
Technical Trading Charts & Levels for S&P, Euro, 10 Year Note & 30 Year Bond are in Hooper’s subscription portion of thecontrariancorner.com
Germany DAX 9:25 GMT
Germany DAX
So, what’s bugging you? Is it Greece? Perhaps you’ve moved on to Portugal, Spain and Italy.? Not getting you jazzed, there’s always Facebook. Do you have a lonnnnng term horizon? You may be looking all the way to June and elections or debt ceiling fights. Here’s what we have on the back burner:
The home market in Canada has got a head on it that would make a cold Labatt’s look flat. Toronto prices are the hot bed. Mortgage rates are hovering plus or minus a few around 3% and 50,ooo loonies is running a couple hundred per month. Sales are closing at well over ask price. The trend is to only accept bids on certain days..between certain hours! Agents are reporting 100,000 over ask bidding wars in the hipster hoods. Hey, hoser!
Meanwhile, Quebec-ies (not sure how they ref themselves) are wearing red ribbons in major education demonstration. Tuition is set to rise a whopping 75% over the next 5 years. Just think, if you can pay for your education you can move to Toronto and make it up in real estate. None of this makes us feel warm and fuzzy about our Northern neighbors who have done an incredible job since 2006. It should be noted that just because its frothy doesn’t mean its ending. Spring should hit the Canucks any month now and the action should get warmer too. Greece is getting all the coverage, but we’ll be keeping an eye on our largest trading partner right next door.
Support & Resistance Levels for multiple time-frames on the Cash Index on the annotated charts below. (Click on graphs to enlarge. May need to click a few times to get to full size)
Technical Trading Charts & Levels for S&P, Euro, 10 Year Note & 30 Year Bond are in Hooper’s subscription portion of thecontrariancorner.com
10 Year Treasury Note
Freebie – Hooper gapped over bullish 118.38 on TLT on 11 May and reached another extended high objective at 119.99 today. TLT joins Hooper ETF package today. Pattern for tomorrow’s trading below: Hooper 101
Markets are breaking down around the world and somehow Greece is part of the discussion. Over a year ago we suggested on this blog that a Franco-German exit and leave the Euro to everyone else was a better solution. Swaps and TEDs are starting to bubble but haven’t blown out ,,yet. Front Eurodollar contracts have broken down and imply 65bp settings. The Bobl (German 5 yr) is at 48bp. There is no reason for the ECB to be holding the rate at 1% in this environment. This is bad central banking.
Support & Resistance Levels for multiple time-frames on the Cash Index on the annotated charts below. (Click on graphs to enlarge. May need to click a few times to get to full size)
Technical Trading Charts & Levels for S&P, Euro, 10 Year Note & 30 Year Bond are in Hooper’s subscription portion of thecontrariancorner.com
30 Year Treasury Bond
Support & Resistance Levels for multiple time-frames on the Cash Index on the annotated charts below. (Click on graphs to enlarge. May need to click a few times to get to full size) Current Hooper Levels for the DAX.
Technical Trading Charts & Levels for S&P, Euro, 10 Year Note & 30 Year Bond are in Hooper’s subscription portion of thecontrariancorner.com
Germany DAX (Cash) 15:00 GMT
