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Be Ready For What Happens Every Time When a Bottom That Looks Like a Top Fails 12/17/21

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You really need to get your tongue out of your cheek, Lee. And you should be above clickbait headlines.  For what, 4 extra sets of eyeballs? SHAME! SHAME on you! 

But boy to we live in interesting times. This morning I'll be working on the latest QE/Treasury Supply/Tax Collections/RRP Slush Fund etc update to spell it out for you. And let me tell you! I'll say this about that. Most people won't believe what they're about to see. But we will. Because everything that we've been looking forward to is coming to a head here, right on schedule.

There are no mysteries. It's pretty straightforward if you are tracking the right data, which is the data that measures and illustrates the forces of supply and demand for financial assets. I'm not Goldman Saxophone, I can't read all the notes, but we can see the ones that matter the most.

And they've unfolded in the sequences that we expected because the people who run this stuff either told us, or showed us, how they would unfold, based both on their posted schedules, and based on our observations of their past behavior. In the business of central bank market manipulation and its interaction with government fiscal policy, the past is indeed prologue. So stay tuned for that update, over at Liquidity Trader, to be posted this afternoon. 

As for prologue, at least read the summary lead-ins of the last two reports, even if you are not a subscriber. Prepare for Market Doom, the Moment of Truth Is Here  and Why It’s Big Trouble that Real Time Tax Data Shows Economy Still Growing Fast. These should give you some idea, hopefully enough to get you to take that risk free 90 day trial! 🙃

Meanwhile, here at the Stool we focus on the intraday technical fartcalls that build upon themselves to create the bigger technical picture that I cover in the Technical Trader reports. Liquidity sets the context. Technical analysis shows the resulting action, and is the basis for trading. 

We usually focus on the hourly chart of the ES, S&P 5 plus 495 fugutures. Here's this morning's at 5 AM in New York. The New York mob wiseguys haven't gotten to their screens yet.

Yesterday when they started to, around 6-6:30 AM, they started selling, and they haven't stopped yet. At Wednesday's close, I thought we might see an infamous finger on the charts. It took until the next morning, but insertion began as soon as the Syndicate awakened on Thursday. This morning, they've crooked the finger so that the knuckle is now being inserted. At 4611, it will be all the way in. Between here and there, we'll find out what comes out in the end. 

There's no 5 day cycle projection, yet. The 2-3 day cycle projection is around 4625. The chart says that that's also a sport level. So maybe they won't get that finger all the way in before the market squirts. 


Meanwhile, the big picture.

Swing Trade Screens – More Buys Than Sells Again This Week

Here’s Why Not to be Dumbfounded in Disbelief

Prepare for Market Doom, the Moment of Truth Is Here 

Gold Hangs By a Thread on the Eve of Destruction

Why It’s Big Trouble that Real Time Tax Data Shows Economy Still Growing Fast

When the Fed Balance Sheet Will Hit the Fan

If you are a new visitor to the Stool, please register and join in! To post your observations and charts, and snide, but good-natured, comments, click here to register. Be sure to respond to the confirmation email which is sent instantly. If not in your inbox, check your spam filter.

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So important, repeating from yestiddy. 


21 hours ago, Jorma said:

You have to hand it to them, TNX is actually down a few ticks right now.


20 hours ago, DrStool said:

$209 billion gotta go somewhere.



20 hours ago, DrStool said:

Of course, this is the end, my friends. 

Prepare for Market Doom, the Moment of Truth Is Here 


19 hours ago, DrStool said:

Now that the debt ceiling dirty deal is done. Here it comes. 

No Santa rally this year, kids. 

Bulls don't know it yet, but they are fucked.

Treasury just posted. $145 billion in net new issuance in 2 days next week. 

Screenshot 2021-12-16 172745.png

Prepare for Market Doom, the Moment of Truth Is Here


18 hours ago, DrStool said:

RRP slush fund surged on yesterday's T-bill paydown. It's now over $1.6 trillion. That buys them a lot of time. It's enough to cover the deficit for 8-9 months. Doesn't mean that all of it will be available though. 

Prepare for Market Doom, the Moment of Truth Is Here


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6 minutes ago, potatohead said:

"So maybe they won't get that finger all the way in before the market squirts.  "

The coffee just went through my nose......great line


Really? Why? What's so great?  

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4 minutes ago, potatohead said:

I get the sense that the finger, knuckles and fist could go all in this time..

You may be right, finger and knuckle in. But sorry, not into that other stuff. 😁


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Of minor note the Infrastructure/catch all spending bill is dead for this session. This was known to be likely for a long time but now it is official. That means no additional deficits.  On a sentiment and practical basis this helps Treasuries.  Not much perhaps, but noted. A trillion less here, a trillion less there, pretty soon your talking about real money.

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