Grasso Gets Squeezed
On CNBC Monday and Tuesday, floor trader Steve Grasso said that the market is rallying due to quarter-end markup. Since when, may I ask, does the markup begin three weeks before the end of the quarter? And with the money gushing out of mutual funds, where exactly are they getting this alleged cash to take the market up? Answer: it’s all BS; there is no markup going on. The buying is all being done by shorts covering-up, and Grasso sounds like a trapped short.
Note to Grasso: it could be worse. You could be a pelican trying to dive for fish in the Gulf of “Peak” Oil.
Another note to Grasso: one thing you can be certain about in the market is that there is always a retracement.
The economic “canary in the coal mine” semiconductors are chirping a bullish song. The SMH is now above all of its major moving averages on the daily chart: the 20, 50, 100, and 200. It’s next challenge is the 61.8% retracement of the sell-off just above at 28.67.
The McClellan Oscillator is now way up in the clouds at +249.74. This is the level where bear-market rallies go to die. But are we in a bear market? Time will tell. If we are still in bull mode, the market will give back a little ground over the next few days, and then blast higher. If you are short, you want to see your positions begin to produce very soon. My TICK indicators are also bleeding from the nose, so I would expect flat-to-down this morning – at least until the TICKs unwind a bit.
How’s that for Accuracy?
Here’s me at 12:57pm on Tuesday:
If the SPX takes out 1105, the next target up on my list is 1115.05.
And where did the SPX close? At 1115.23, only 0.18 points above my target. That that Nostradamus!