Another straight up rally

Is this a bear market or what? Bear markets rally on news and viciously.

A = 1250, B = 1350, C = 1300, simple numbers... AB=CD -> 1400, or 1.27 * AB = CD -> 1430... I think 1430-1440 (2008 high) is more likely, but this gap at 1350 needs to be closed within a few sessions...

Is this a bear market or what?

Bear markets rally on news and viciously.

seems like the fed and investment banks (if one even needs to differentiate the two at this point ), have learned from the flash crash and taken steps to, surprisingly enough, boost US stocks.

A. lower margins on SPX futures (tsk tsk Waddell/Reed, flash crash scapegoats)
B. make sure to BUY the EUR/USD when stocks and currencies are trading at nearly a perfect 1:1 correlation. Turn that euro smoldering crater from last May/June 2010 into a moon-bound space shuttle, and, TADA!!, spx 1400+ in no time
C. coordinate with the ECB and congress before making any currency-market-moving announcements. Translation: let the euro-zone "solve" (and I chuckle as I type that word) their debt problems when the euro is at 1.40 vs the dollar, then blow it out to 1.50 in a week before announcing any dollar positive news.
D. allow investment banks to use ES contracts as collateral to borrow from the Fed, then turn around and drive the euro to infinity and tax consumers with higher commodities. (of course, the wealth effect will offset that, duh!)
in reality, the preceding is in fact QE3, while everyone believes there was none/will be none. Of course, it was done under cover of the potential default overhang, and the rationale is reducing the amount of treasury securities being used as margin/collateral will soften the blow to financial markets if/when default occurs. The common sense interpretation is basically GS and JPM can whipsaw the shorts even more than they already were doing, as now they're actually in a position of basically being FORCED to buy spx futures. (yes, thats why the last month or so in equities has been all futures driven, amplified by the way futures trade tightly with eur/usd in thin volume)

Disclosure: shorted EUR/USD at 1.443 today

Edited by Jhoe, 21 July 2011 - 04:21 PM.