Jump to content

Breaking the Zero Line 5/1/24

Rate this topic

Recommended Posts

Anytime  oscillators hang around the zero line, the next move is likely to be explosive when they finally break away, one way or the other. 

Yesterday I warned about that and, "Sho Nuff" when the broke the zero line, down they went. 

Now we have a bit of a crash channel working, but the 5 day cycle projection on the ES 24 hour S&P futures is only 5010-15, and we're there. Doesn't guarantee the end, but be on the lookout. 

Nothing important is planned for today anyway.



There are spport lines between 5015 and 5000 that need to be watched. If they break, what had looked like a bottom pattern will turn into a top pattern. Lots of false moves. 

For moron the markets, see:   

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 folder. 

Link to comment
Share on other sites

  • Replies 35
  • Created
  • Last Reply

Top Posters In This Topic

Top Posters In This Topic

Several of you asked about FxFox. You may be able to reach him by the board's messaging system if you wish to stay in touch with him, or any other members. No one has been deleted from the system, but some people's contact info may not be up to date, which means that there would be no message notification by email. 

I wish everybody well in their lives and daily pursuits. 

Happy Labor Day to those of you here in Europe. 

No holiday for US Merkans.  


Link to comment
Share on other sites

Hi Stooligans,

since some asked about me: Yes I‘m alive and I feel fine. 😎

Hope the same can be said about every Stoolie and I hope Doc was a good guide - as always - for you in last few weeks.

Best regards


Link to comment
Share on other sites

Can't believe anyone is going to say anything other than soft words of reassurance this afternoon.  The last thing the political environment wants is a crashing market.  Every Fed since I can remember, has supported whoever was in the White House.  I don't see that changing.  Doesn't mean anybody is right or wrong about the market, I just think the Fed will be walking on eggshells until this passes.  


Link to comment
Share on other sites

Bulletin- Fed Cuts QT by $35 billion per month. This is irrelevant and immaterial in the face of the mushrooming Treasury supply ahead. Read on!   Non-subscribers, click here for access. 

Subscribers, click here to download the report.

Today is FOMC circus day, with the Chairman’s Dog and Pony Show after the main event.  Non-subscribers, click here for access. 

It’s all irrelevant. The First Law of Market Dynamics—Don’t Fight the Fed—has been called into question since October 2022 when a new cyclical bull market was born despite Fed policy. It was tight then, and remains tight now, as the Fed relentlessly drains money from the system by shrinking its balance sheet.  Non-subscribers, click here for access. 

That won’t change until the Fed does more than talk about it. And why should it change. Inflation marches on, and the markets are doing just fine.  Non-subscribers, click here for access. 

Tight Fed policy hasn’t mattered because the players have been determined to create their own liquidity. Who needs QE when you can just borrow your own cash into existence. With plastic in our pockets, we are all mini central banks. We create credit and money by simply spending what we don’t have because the banks give everybody, especially hedge funds and dealers and private equity, a blank check for credit when they want it.  Non-subscribers, click here for access. 

Of course, the Fed had also set up an enormous sludge fund, oops, I mean slush fund, called the RRP facility. That was set up as a piggy bank where all the money market funds deposited all the excess cash that the Fed had pumped into the system during 12 years of QE. At one point in 2022, that fund exceeded $2.5 trillion. That will fund a lot of stock purchases.   Non-subscribers, click here for access. 

And it has.  Non-subscribers, click here for access. 

Gradually that fund was drawn down as the US Government ran persistent huge deficits and had to borrow the money to fund them. Only since 2021 has the Fed not been there to buy all that debt. That debt issuance, particularly in the form of short-term Treasury bills had sopped up all but $330 billion of the RRP slush fund by two weeks ago, April 15. But since then, things changed as we knew they would.   Non-subscribers, click here for access. 

Here’s what it means, along with a road map of how to drive the markets’ winding roads over the next few months.   Non-subscribers, click here for access. 

KNOW WHAT’S HAPPENING NOW, before the Street does, read Lee Adler’s Liquidity Trader risk free for 90 days! Act on real-time reality! 

Link to comment
Share on other sites

This topic is now closed to further replies.
  • Tell a friend

    Love Stool Pigeons Wire Message Board? Tell a friend!
  • Recently Browsing   0 members

    • No registered users viewing this page.
  • ×
    • Create New...