pisces' this time i'm getting out - friday, page-45

ehsaale:

US Unemployment: It's a good plan. Only problem is two fold; who's gonna pay for it, and requires Congress to approve further debt - thus more uncertainty.

US Recession: Trade balance data is the one bit of news that came in better than expectations AFTER the expectations were revised from shocking manufacturing, employment and consumer spending data. Deny it all you want - short of Ipads and Iphones (which are made in China) the US exports nothing of note but debt.

Monetary Policy: Bernanke has done a brilliant job so far. Not.

Europe: G7 will of course talk tough. But markets don't lie. 46% interest on 6 month Greek bonds tells you the entire story. That the Eur/USD broke 1.40 tells me rumors of the sterling and baht raid by one esteemed hedge fund guru could be truth. Euro is about as symbolic as French Fries are to the French.

Shorts: That I have to agree with you. Too many shorts. Not enough REAL selling. The catalyst for Armageddon must arrive not by Greece defaulting - that's already been built into the price, short of a few percentage points more maybe. There needs to be a Black Swan event - SG going bust, or Italy plunging to be like for like with Greece, or Spain deteriorating to junk. It is rather dangerous to be short - with governments seemingly very determined to stave off a worldwide equity selloff.

But like a very, very old trader once told me - there is only so long you can hold the lid of a boiling kettle down, before the heat burns your hand and it pops.

The hard part is to actually be short when that happens, or recognise when that happens and get short and ride the whole way.

I must admit last few days I thought the line in the sand would give way. But it has proven more resilient than I have expected. The light volumes on the up days justifies the view that the market is full of shorts, and the longs are happy to stand pat and not sell. Which is a tremendous credit to their beliefs and gonads.

I wouldn't discount a rally of significant proportions to even take the SPX back up to its highs of 1350.

But its all a time bomb.

The higher it goes, the more it has to fall.