Volcker Does Not Get It

http://www.nakedcapitalism.com/2010/01/volcker-does-not-get-it.html

More disappointing reality....

Top 25 Censored Stories for 2010

http://www.projectcensored.org/top-stories/category/two-thousand-and-ten-book/

This site is really worth checking out...

Why this is probably the end of the rally...

Notice here the huge divergence between price and the price/volume weighted CMF indicator as seen in the ETF that tracks the risky small cap Russell 2000 (lower chart, IWM). The July correction in price was equally deep to what we have seen now, but it had buying volume on it's side, unlike the present situation...

Battle of the Titans: JPMorgan vs Goldman Sachs

http://www.huffingtonpost.com/ellen-brown/jpmorgan-vs-goldman-sachs_b_441922.html

I Am Become Debt, Destroyer Of Worlds

http://www.safehaven.com/article-15625.htm

Interesting....

Funds flee Greece as Germany warns of "fatal" eurozone crisis

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/7095818/Funds-flee-Greece-as-Germany-warns-of-fatal-eurozone-crisis.html

After Greece goes the way of Iceland (soon) then maybe Spain goes down too? Then who's next? The last domino to fall will be the U.S.

The World Economic System is dying, and like a drowning man, where the heart and lungs shunts the available blood back and forth between the brain and the heart to keep the 'core' alive, the world system is doing the same. The 'blood' is 'liquidity'. The brain and heart of the world system are probably, London and Wall Street, so they may survive for a while, at the expense of the 'extremities' (small countries) of the global system...

The Greatest Threat to America

http://english.pravda.ru/opinion/columnists/111884-0/

From Pravda, no less....found this link on Urbansurvival.com....

Getting closer to a more sustainable bounce..

Note that the $SPX is now just about at support from the trendline that rescued it back in July...the $NDX is close to, but not yet at, the equivalent place...

Consequences of the Mass. Election

http://www.zerohedge.com/article/consequences-mass-election

Interest Rate Roulette - Ron Kirby

http://www.financialsense.com/Market/kirby/2010/0125.html

You can see the double bottom...

So the bounce really got started today, after the double bottom completed. Now we will see how much power it has. My belief, is not enough to revive the rally from last March....

Someone on another site said that Obama's State of the Union address tomorrow night will be important. I suspect that's true, and even though I don't usually correlate news with market changes, further emphasis in that speech on curbing the banks may well be the catalyst that causes this little rally to top and reverse say, Thursday morning. Just a guess.

The bounce has materialized, but...

It doesn't look terribly strong. Can't say if it ends later today or lasts a couple days, but how long it lasts will say something about the strength of the downleg that's starting....

The New Political Rumbling

http://online.wsj.com/article/SB10001424052748703699204575017503811443526.html?mod=WSJ_hp_mostpop_read

A good piece from the Wall Street Journal.

Fed to End Overseas Dollar 'Swaps'

http://online.wsj.com/article/SB10001424052748704423204575017281252221758.html?mod=rss_economy

Wow! weak market!

Notice the upper chart of the $SPX. We have already breached the exponential trendline that has been the primary support for the rally from March (the trendline with the black arrow pointing to it). If we now go on to breach the deeper trendline (pointed to by the green arrow), then the Bear has probably returned. The light blue arrow shows the only correction that occurred since March that was deep enough to use this lower trendline for support.

Wedge forming...

Obviously, a bounce will happen later today or Monday. If the bounce doesn't materialize into a powerful rally, then the Bear is back. So we'll see what happens...

So, Corporations can now spend unlimited amounts to promote "their side" in campaigns...

I'm sure you've heard of the new ruling, if not, here's a link:

http://www.bloomberg.com/apps/news?pid=20601103&sid=a_ONCajlMuTY

I can just hear the noise levels going up, more misinformation and disinformation then ever. Maybe this will get people to stop watching television, I'm sure it will get shrill as well as busy as corporations and unions on opposite sides of an issue try to outspend each other on TV ads. With deep pockets, the nonsense levels could reach new highs, and truth, more then ever, will be the casualty here.

Meanwhile the market is down again today, I'm just waiting for the 'end of day' to run my analysis....

Decline may have indeed started...

Probably by the end of this week, we will know that the Bear is indeed back. The market action of the last two days strongly suggests this.....

I will redo all of the important charts tomorrow night, and see what we have at that point...

What I am watching for is a decline of the $SPX, particularly, that takes it below the 'micro' trendline that it's been 'resting on' as it 'climbed'. None of the minor corrections in that index has penetrated that trendline since the rally started, so I will take that event as pretty solid evidence that this correction is of a different scale and much higher importance then the other ones.

Looking like a distribution pattern...

The market continues it's "up one day and down the next" pattern, but it could be a distribution top. Today's market action might well have something to do with the elections last night. I would say Brown's victory in Massachusetts has to be the start of something bigger. I distrust Republicans every bit as much as I distrust Democrats, but man by man we have to sift out the trash in each party to get reform.

Still waiting on miss market...

You can see here the negative divergence on the Nasdaq breadth indicator $NASI compared to the $NDX, shown by the dashed, thick black line, and the two recent node hits given by the vertical red dashed lines on 12/28/09 and 1/08/10, and also all of the recent places where RSI on this breadth indicator peaked. These were usually at least short term tops. Though that's true, today didn't resolve anything...