Breadth Falling apart

Can they squeeze an EOM rally? But squeeze from who? They've been buying calls since last Thursday. I would not be surprised if the market bounces in the morning a bit and goes straight to 1300. They unloaded as much as they could and Apple Index (NDX) is also about done. The only time Apple was at 52 wk high and gapped about 5% after earnings was in Oct 2007. My expectation was a positive close for July and top in early August, but the market is ready to give up without an upside catalyst. The assumption was they've been trying to churn sideways and sell the debt news after a squeeze, but squeeze who? Certainly I don't see much any short sellers. The top should not come before an euphoric rally out of this range, so perhaps it is only bullish speculation from here, although very few is selling short here, are they buying though? NAAIM shows near 80% allocation, perhaps we go to 100% and some...

EOM rally. We have some Treasury auctions settling soon 7/28 and 8/1. How do the pay for them and prop the market up?

http://www.treasuryd....gov/RI/OFAnnce

Upcoming Auctions
Announcement
Date Security
Term Security
Type CUSIP
Number Auction
Date Issue
Date Maturity
Date
07-21-2011 5-YEAR NOTE 912828QX1 07-27-2011 08-01-2011 07-31-2016
07-21-2011 7-YEAR NOTE 912828QY9 07-28-2011 08-01-2011 07-31-2018
07-25-2011 5-DAY BILL 912795Z79 07-27-2011 07-28-2011 08-02-2011
*07-28-2011 91-DAY BILL 9127953R0 08-01-2011 08-04-2011
*07-28-2011 182-DAY BILL 912795Y88 08-01-2011 08-04-2011

Edited by babs, 26 July 2011 - 04:59 PM.

I think it is much more likely that the market will shoot lower from here with a very rapid collapse till the end of the month below 1300, but I just did not want to think of that possibility since many averages have been trending up. In any case, I am pretty sure that Senate will not be passing a debt law on Wednesday night, it looks almost impossible. OTOH, I am not sure any US based credit agency will dare to down grade US' credit rating as it doesn't miss an interest payment in the next month. So, the evil in me says I have to fade all of the fears when people (finally) panic. I just cannot accept the thought that the market will top without the large caps making a new high.

Babs, what is holding the US markets up at the moment? The interventions from other central banks probably...

But, I also see the activity in the securities lending pretty high, this is straight out of Fed's portfolio, right? No new POMO from Treasuries will be needed for those, right? Or I am wrong?

http://www.newyorkfe...ieslending.html

The Bank provides a secondary and temporary source of securities to the financing market through a Securities Lending program to promote smooth clearing of Treasury and Agency securities. The program offers securities for loan from the System Open Market Account (SOMA) portfolio in accordance with program terms and conditions. Securities loans are awarded to primary dealers based on competitive bidding in an auction held each business day at noon eastern standard time.

The chart is at the link, it is on a rise, this started up the June rally with a sharp short squeeze, but the problem is the short interest, there is not enough shorts since last week. The peaks on the securities lending activity correspond fairly closely to most short squeezes in 2008 and so did this one --it usually leads by 2-4 days or so...

Edited by arbman, 26 July 2011 - 09:17 PM.

This A/D looks like it could fall apart here.
Laundry's chart.
http://stockcharts.com/c-sc/sc?s=$NYAD&p=W&yr=5&mn=0&dy=0&i=p67734071586&a=234382794&r=324.png

Compare to July 12, the difference is CPCE, if it bounces well, it means a lot of strength, imho...

I expect a high open and then free fall kind of day actually...

http://stockcharts.com/c-sc/sc?s=$NYUD&p=D&yr=0&mn=1&dy=0&i=p74933377396&r=2215&.png

Edited by arbman, 26 July 2011 - 10:40 PM.

For the uninitiated, why?

Fib

This A/D looks like it could fall apart here.
Laundry's chart.
http://stockcharts.com/c-sc/sc?s=$NYAD&p=W&yr=5&mn=0&dy=0&i=p67734071586&a=234382794&r=324.png