Slope of Hope Blog Posts

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American Scripture

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IN CONGRESS, July 4, 1776.

The unanimous Declaration of the thirteen united States of America

When in the Course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.–That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, –That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed.

But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.–Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government. The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.

He has refused his Assent to Laws, the most wholesome and necessary for the public good.
He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them.
He has refused to pass other Laws for the accommodation of large districts of people, unless those people would relinquish the right of Representation in the Legislature, a right inestimable to them and formidable to tyrants only. 
He has called together legislative bodies at places unusual, uncomfortable, and distant from the depository of their public Records, for the sole purpose of fatiguing them into compliance with his measures. 
He has dissolved Representative Houses repeatedly, for opposing with manly firmness his invasions on the rights of the people.
He has refused for a long time, after such dissolutions, to cause others to be elected; whereby the Legislative powers, incapable of Annihilation, have returned to the People at large for their exercise; the State remaining in the mean time exposed to all the dangers of invasion from without, and convulsions within.
He has endeavoured to prevent the population of these States; for that purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their migrations hither, and raising the conditions of new Appropriations of Lands.
He has obstructed the Administration of Justice, by refusing his Assent to Laws for establishing Judiciary powers.
He has made Judges dependent on his Will alone, for the tenure of their offices, and the amount and payment of their salaries.
He has erected a multitude of New Offices, and sent hither swarms of Officers to harrass our people, and eat out their substance.
He has kept among us, in times of peace, Standing Armies without the Consent of our legislatures.
He has affected to render the Military independent of and superior to the Civil power.
He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation:
For Quartering large bodies of armed troops among us:
For protecting them, by a mock Trial, from punishment for any Murders which they should commit on the Inhabitants of these States:
For cutting off our Trade with all parts of the world:
For imposing Taxes on us without our Consent: 
For depriving us in many cases, of the benefits of Trial by Jury:
For transporting us beyond Seas to be tried for pretended offences
For abolishing the free System of English Laws in a neighbouring Province, establishing therein an Arbitrary government, and enlarging its Boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule into these Colonies:
For taking away our Charters, abolishing our most valuable Laws, and altering fundamentally the Forms of our Governments:
For suspending our own Legislatures, and declaring themselves invested with power to legislate for us in all cases whatsoever.
He has abdicated Government here, by declaring us out of his Protection and waging War against us.
He has plundered our seas, ravaged our Coasts, burnt our towns, and destroyed the lives of our people. 
He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation and tyranny, already begun with circumstances of Cruelty & perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation.
He has constrained our fellow Citizens taken Captive on the high Seas to bear Arms against their Country, to become the executioners of their friends and Brethren, or to fall themselves by their Hands. 
He has excited domestic insurrections amongst us, and has endeavoured to bring on the inhabitants of our frontiers, the merciless Indian Savages, whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions.

In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people.

Nor have We been wanting in attentions to our Brittish brethre
n. We have warned them from time to time of attempts by their legislature to extend an unwarrantable jurisdiction over us. We have reminded them of the circumstances of our emigration and settlement here. We have appealed to their native justice and magnanimity, and we have conjured them by the ties of our common kindred to disavow these usurpations, which, would inevitably interrupt our connections and correspondence. They too have been deaf to the voice of justice and of consanguinity. We must, therefore, acquiesce in the necessity, which denounces our Separation, and hold them, as we hold the rest of mankind, Enemies in War, in Peace Friends.

We, therefore, the Representatives of the united States of America, in General Congress, Assembled, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the Name, and by Authority of the good People of these Colonies, solemnly publish and declare, That these United Colonies are, and of Right ought to be Free and Independent States; that they are Absolved from all Allegiance to the British Crown, and that all political connection between them and the State of Great Britain, is and ought to be totally dissolved; and that as Free and Independent States, they have full Power to levy War, conclude Peace, contract Alliances, establish Commerce, and to do all other Acts and Things which Independent States may of right do. And for the support of this Declaration, with a firm reliance on the protection of divine Providence, we mutually pledge to each other our Lives, our Fortunes and our sacred Honor.

What A Week (by Faces in Cabs)

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It has been a fairly
abnormal week with five consecutive down days on each major index.  And finally bonds broke out, when bond yields
(like $TNX) went into a tail spin.

http://tinyurl.com/32vyt82


Snap31

 I had mentioned on
Friday afternoon to "expect the unexpected", and that's what we
got.  I mentioned in the posted thread
that I was expecting another "flash down" on Friday afternoon.  Well, 
we got it but the event was delivered with a rather obscure curve
ball.  Here is a SPY 1 minute chart of
the afternoon that shows what happened.

 


Flash Event
 

 

A grind up (e.g., the
curve ball) and then a clear and persistent selling event for a solid 15
minutes (e.g., another flash event on larger volume than the move up).  Definitely a tricky tape when Market Makers
include antics like this 30 minutes in front of the holiday weekend.

See everyone on
Tuesday.  Have a good holiday!

Charts From The Comments (Friday Morning)

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Charts from the comments the Friday edition.

springheel_jack posted:

Very interesting chart of the oil sept futures for anyone interested.

I'd
drawn in the lower trendline yesterday morning but didn't post or trade
it because I was doubtful about oil dropping that low, but there were
some big moves yesterday & the lower trendline was hit.

If
the pattern holds for a while then we'll see oil drop a lot lower with
some really wild recoveries.

Spring_jack_01_oil

Click for bigger

Also:

I haven't been charting the 10yr really, but here's my take on 30yr
treasuries:

Spring_jack_02_treasur

Click for bigger

Yazzer posted:

Summation Index getting truncated back downward – this was the thing I
was most afraid of before this last downdraft – it fizzled badly
though…the emperor has no clothes?

Yazzer_01

Click for bigger

facesincabs posted:

Banking rolling over …

Facesincab

Click for bigger

Also:

Here's another area I am watching to initiate another down leg …

Facesincab_iyr

Click for bigger

redvetttes has been stalking (COST). Here's a link to his chart.

ES Fighting EUR Upswing (by Springheel Jack)

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There was a simply amazing move up in EURUSD yesterday and I think that
it is now highly likely that it will make my target in the 1.28 area in
the next two or three weeks. On the 60min chart EURUSD is moving up
within a rising wedge:

100702_EURUSD_60min_Rising_Wedge

The target in the 1.28 area is to hit the upper trendline of the
broadening descending wedge on the daily chart which has defined the
EURUSD decline over the last seven months:

100702 EURUSD_Daily_BD_Wedge

In my view the main reason that ES has been struggling to make headway
on the downside in the last few weeks is that EURUSD has been in an
upswing phase, and USD therefore in a retracement phase, and that
equities move downwards fastest when USD is in a wave up.

In December, when the SPX was still in a strong uptrend, it would trade
sideways to up when USD was in a wave up, and move up strongly when the
USD was trending down. What we've been seeing the last few weeks has
been the reverse of that, with the SPX in a strong downtrend, and moving
downwards strongly when USD has been in a wave up, and trading sideways
to down when USD has been retracing. We've seen some impressive moves
since the last interim bottom on EURUSD in the 118.75 area, but have
dropped, at the end of the day, only 20 points on SPX as I write. By the
time EURUSD hits the upper wedge trendline SPX will probably be 20 to
40 points above where we were when EURUSD bottomed.

In terms of the current move down on ES, we are in a declining channel
on the daily chart, though there have been some major intraday
pinocchios through the lower trerndline of the channel, and I posted
yesterday morning that I didn't think we would see the next interim low
until the lower trendline of that channel was hit. We hit it during the
day yesterday so from that perspective the interim low may already be
in:

100702_ES_Daily_Declining_Channel

I was expecting a hit at the 990 ES level to be the next interim low
today or next Tuesday, but as the bottom of the main declining channel
has already been hit that may not happen. In the shorter term the ES is
also in a smaller declining channel, though it is possible that it is a
falling wedge that we are already breaking up from. If it is a channel
then ES has been crawling down the upper trendline overnight, and an
hourly close at 1025 ES or higher would be a break up from that channel.
IF ES trades that high then the interim low is probably in and the
upswing target will be the upper trendline of the main ES declining
channel in the 1070 – 1090 area.

Here's the shorter term declining channel on the ES 60min chart:

100702_ES_60min_Declining_Channel

So what I'm seeing is essentially this:

  • EURUSD rallying towards 1.28.
  • ES has made an interim low yesterday or will make a slightly lower
    low in the next two or three trading days. 
  • After the ES interim low is in then we should rally back towards the
    1070 – 1090 area.
  • After EURUSD hits 1.28 and ES hits the top of the main declining
    channel, then USD should start another strong wave up and ES should
    start another strong wave down. Both moves will be fast and strong as
    they will not be fighting each other. My EURUSD target for the next wave
    down is under 1.10 and my SPX target is 870.

There is one major caveat of course as EURUSD could hit the top
trendline of the broadening descending wedge at 1.28 and just go through
it. That seems unlikely to me at the moment as both the ES and EURUSD
downtrends look unfinished, but if that did happen then my bear scenario
for the summer might well then not happen. We'll find out when we get
there.

I'm out for the whole trading day today. Have a great holiday weekend
everyone.