It was a busy day today and when I finally had time to check on the market a big grin came to my face. A lot went on today and news blamed Greece and Portugal downgrades for the sharp drop. Nobody ever talks about the technical analysis because it is beyond the mind of Joe the Plumber.
Let’s start off with the Eur/Usd which I have closely followed since December when it broke a long term trendline. I hadn’t looked back at it since and I was shocked. Here is the first in a series of Special charts.
Next on the list is $TED which stands for the Treasury – EuroDollar Spread. You can read more about what Ted is on this November post if you are not familiar with it.
WHile the spread of 0.2 is still fairly low and below the average of 0.5 the fact that it is increasing and the moving averages are making their first crossup since before the October 2008 crisis strikes me as interesting especially given the current economic situation.
While on the subject of Europe lets check out the Greek Index $GRDOW which I wrote about on April 11 and that turned out to be the opposite of what I expected. From a low of 124.17 on March of 2009 the Greek index went through the roof at 267.40 and as of close today it stands at 138.11. Go Greece!!!
Now lets take a look domestically at BID – Sotherby’s which as I mentioned on March 14th’s post is Part of my indicators arsenal. BID fell from 37.75 to 34.93 today which broke a short term trendline but also another big move would put it below the 32 mark that is the next strong support. Since the March 2009 lows of 5.85 BID is up 666% to as high as 39! That’s nearly 47% a month. A move below 32 (20% drop from 39) would tell me to wipe the dust off my ammunition and a move under 22 (40+% drop) would just signal that Chaos is back and since this is a Leading indicator to me it would highly influence my positions.
Lastly I will leave you off with the Investing Freak Special SPX chart that I last posted on April 14th. We hit a top, retreated a bit below the blue moving average then made a higher high at 1219 but this time it was different as the retreat didn’t land on solid ground and we fell through.