I'm sure I could be forgiven for not falling all over myself to put together a post tonight. It's been a rough week – – pretty much everything the bulls could have asked for was delivered on a shiny silver platter over the past couple of weeks. The ECB pledged infinite bond buying. The German Court gave a big thumbs-up to the bailout. Bernanke likewise pledged infinite bond buying at a new pace of $85 billion every single month. We live in unprecedented times.
Some indexes are at levels never before seen in human history. It is truly like the financial crisis and the so-called Great Recession never happened. Central Bank printing has erased them from history.
The NASDAQ is at a level not seen in a dozen years, although it won't be long before it nails its trendline of resistance (although these don't exactly act like iron walls these days).
The Dow – astonishingly – is within spitting distance of its October 2007 high. Mind-boggling, is it not?
The small-cap-based Russell 2000 tagged its lifetime high today; even a strong puff of air Monday will send this index to lifetime highs.
Although gold and silver had an amazing week to the upside (which caps an amazing several months), I do note with interest that a very powerful Fibonacci retracement has come into play. I wouldn't be surprised to see precious metals weakness next week.
Lastly, just about the honest-to-God, holy-crap-it's-going-to-plunge chart left is the bonds. This is a massive head and shoulders pattern.
As for myself, since I'd rather not have a $0 account balance, I remain conservatively positioned, with two-thirds in cash and one-third in a variety of small shorts (I goosed this up from 25% at the opening). We truly seem to live in a QE-infinity world now, and until such time as, for whatever reason, it's evident that QE simply won't work anymore, this is our New Normal.
