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In spite of the gargantuan rally on Thursday (the biggest rally on the S&P in over SEVEN MONTHS!) the tech stocks, bless ’em, haven’t ruined their bearish setups yet. It wouldn’t take much to do so, but I at least want to point out that, for now, we still have valid price gaps on the NASDAQ Composite:
I don’t think a single person here needs any more evidence that the Fed is totally, completely, and utterly in control of equity markets. All the same, I wanted to show you a couple of dual SlopeCharts to help drive this point home.
This first one shows the total Fed assets (a figure which used to linger in the lower hundreds of billions and was used to tweak things now and then, but now has grown into a laughable nearly $9 trillion slush fund). You can see how the financial crisis in 2008 was met with an enormous heroin-shot of asset purchases, which at the time took months to take effect.
As massively, hugely, and grotesquely an “up” day it was for every asset from kitty litter to equities to futures, even in this everything-is-green environment, Brazil couldn’t log a positive change. This has been the Old Faithful for the bearish set, steadily bleeding itself lower week after week, month after month.
When the market is falling, it’s easy (and a kick!) to go on and on about how shorting stocks is the most fun you can have with your clothes on. When the market is vomiting higher (as it is at this very moment), it’s very, very tough to mention anything bearish. But here I am. I’m no foul weather friend.
As I’ve mentioned ceaselessly, there’s no sector I am more enthusiastically bearish about than energy, with XLE being my guiding light:
Truly one of the greatest examples of “getting away with it” in history.
