Troops look tired

From the 10/2 swing lows, the generals have been leading, while the troops are lagging. The sectoral deterioration from the 10/2 lows is very apparent on the chart. With the exception of RTH, most other sectors are underperforming vis-a-vis the DJIA. RTH which has been the worst performer since the March lows on a relative basis is now the new leader

I am short and will stay short. The price will not move me.

troops look tired, but generals are on steriods just like lance, he doesn't need a team to get first over the mountain but i agree that buying is not as intense  t.bmp   128.63KB   91 downloads

Internals lagging?...an extra several billion dollars a day from the Fed funnelled directly to the primary dealers should fix that problem if they choose to do so. There's a couple hundred billion left from the 1.25 trillion dollar intervention. The Fed said they'd stretch it out to the end of Q1...but they could change their mind yet again and use it now...depending on market conditions.

Edited by entre, 20 October 2009 - 08:21 AM.

[quote name='entre' date='Oct 20 2009, 06:21 AM' post='488097']
Internals lagging?...an extra several billion dollars a day from the Fed funnelled directly to the primary dealers should fix that problem if they choose to do so. There's a couple hundred billion left from the 1.25 trillion dollar intervention. The Fed said they'd stretch it out to the end of Q1...but they could change their mind yet again and use it now...depending on market conditions.


are you telling me the Fed is on the edge of their seat ready to use huge $$$ at the slightest bit of a downtick to help the mkts after they have rallied 3,500 pts?

The Fed said it was "practicing" reverse repos last week, which is the opposite of funneling money to the banks. Ben was signaling what he could do if he wanted to.

sorry JN didnt see your comment - but they were saying "IT is only a TEST" and said they were very concerned the market would misunderstand the TEST for the EXIT, and reiterated this is NOT the EXIT...., posted news link in a later thread, also new Treas plans to put more loans out to help mortgages.

Why does the Fed need to "practice" reverse repos? What is the reason for a "test" right now?

I'll be watching to see when the Fed actually does drain or seem like they will drain instead of just talking about it. Talk is cheap...they've been talking about keeping a strong dollar for who knows how long.

Internals lagging?...an extra several billion dollars a day from the Fed funnelled directly to the primary dealers should fix that problem if they choose to do so. There's a couple hundred billion left from the 1.25 trillion dollar intervention. The Fed said they'd stretch it out to the end of Q1...but they could change their mind yet again and use it now...depending on market conditions.


are you telling me the Fed is on the edge of their seat ready to use huge $$$ at the slightest bit of a downtick to help the mkts after they have rallied 3,500 pts?

Possibly...well here's the article. The bottom-line is despite the lack of a market pullback after rallying 3000+ points a significant number of them still wanted to jam more aggressively! If the two camps are that close...you can bet any market pullback will sound the alarms and tilt the majority into more aggressive intervention action.

WASHINGTON (AP) -- Amid uncertainties about strength of the budding recovery, Federal Reserve policymakers last month were conflicted over whether to expand or cut back a program intended to drive down mortgage rates and prop up the housing market, according to a document released Wednesday.

In the end, Fed Chairman Ben Bernanke and his colleagues agreed to slow down the pace of a $1.25 trillion program to buy mortgage securities from Fannie Mae and Freddie Mac. Instead of wrapping up the purchases by the end of this year, the Fed said it would do so by the end of March. But minutes of the Fed's closed-door deliberations on Sept 22-23, revealed some members thought "an increase" in the mortgage securities buying program could help the economy recover more quickly. Another member believed "a reduction" was warranted because the recovery was showing signs of picking up.

The minutes don't identify speakers by name, but rather seek to provide a more detailed account of the Fed's discussions.
The central bank last month also agreed to slow down purchases of $200 billion in debt from Fannie and Freddie, although there were no fractured thoughts on that action.

At the same time, the Fed held its key bank lending rate at a record low near zero. It pledged to hold it there for an "extended period" to nurture the recovery. Fed policymakers "judged that the costs of growth turning out to be weaker than anticipated could be relatively high," according to the minutes.

http://www.thestreet...ng-program.html