Replies to post #106992 on Zeev's Turnips Patch-No Politics (ZEEV)

[Joe Stocks]

>>I mean, at some point, it's got have taken on a "life of its own", eh?<<

Hope you don't mine me saying something here. What surprising me at this point that I am still not seeing any signs that this market has taken on a life as it's own. As I have mentioned, I watch the daily tick like a hawk. I do not see any sustained buying without a buy program to pump things back up again. Also I have noticed that steeps falls in the tick last but a minute or two before they are pumped back up. There is no follow through (or very little ). What I see on the daily tick charts is a chart of sharp peaks and valleys. This is very abnormal because a market they was moving freely would not behave this way. In a "free" market you would have more drifting and the tick showing signs of uncertainty. What we see is a series of very bullish and very bearish behavior with very little of the in between.

How I read this is that someone is trying to push the market up to a point where the market will take on "a life of it's own" and still can not find any support. Yesterday was another classic. Buy program after buy program to move the market with no follow through. A "balanced" market does not give you a jump in the tick of 200+ basis points on the one minute chart time after time. What you end up with is a series of green poles with red pennants. That would be a heavy buy program followed with a stright up bar on the 3 minute chart followed by gradual selling off - only to be followed again with another sharp buy program. I question why more don't question why buying shows up in gap opens and in just 1-3 minute time frames troughout the day.

Interesting note. On several of these big up days I have counted the 3 minute bars on the nas nms tick, dividing them by green and red. Everytime I have suspected interevention I have counted more red bars than green in as much as a 60/40 ratio. That's not normal bullish behavior although the results suggest otherwise.

Joe

[mlsoft]

baletwine...

I am not sure how to answer your question. I assume you mean the rally from the beginning in March, but to quantify how much is due to the Fed is impossible to calculate, or even estimate.

The bottom in early March was very clearly a Fed manipulation and the rally off the lows was also. If you mean what was the driving factor behind the rise each day the market went up and what kept the drops from being worse than they were on days when the markets went down, I would say almost 100% the Fed because I have seen almost no self sustaining rally occurring in this run, and I have not seen but a very few days (if any) that I saw no signs of Fed intervention.

What makes your question impossible to answer though, is that the Fed itself only works with a relatively tiny handful of stocks and on occasion the futures. The key to their success is that the handful of stocks they use are the market leaders, index leaders, tech leaders, and sector leaders so when they go up or fail to go down they have an inordinate amount of influence over what the rest of the market does. So while the Fed deals with a small number of stocks (and futures on occasion), it is able to exercise control over the markets as long as the volume remains relatively low and heavy selling does not come in.

As long as heavy selling does not come in, I expect AG to continue to drive the markets higher with only very short, shallow corrections. He has to drive the markets higher or see the US (and global) economy sink into a serious and long lasting recession with the very real danger of deflation, which is very, very difficult to get out of and has very serious consequences. Driving the markets higher is his only hope to stave that off.

I hope that answered your question.

mlsoft