Fed To Us, You’re On Your Own
- Posted by UpsideTrader
- on June 23rd, 2011
The Fed lowered their GDP estimate yesterday, hiked inflation expectations and the said “we will continue to act as needed”, but it was a downbeat speech (” The Bernanke” was never Vince Lombardi anyway). The biggest volume day of the year so far was the day of the Japan earthquake and yesterday was the lowest. This will be the third largest year for stock buybacks by corporations, so you wonder what volume would be like without that. Citigroup was trading an average of five hundred million shares a day before it morphed from a penny stock to a “real” stock via its reverse split a few months back. That has also had a big impact on volume numbers. The Fed always plays with six aces in the deck so I am sure they will be more than happy to print again, conditions permitting.
The chart action is still sketchy at best and although the market made a respectable effort to rally on Tuesday, it didn’t give the longs much validation yesterday. Reversal days should be accompanied with monster volume and we didn’t see that Tuesday. If Tuesday was a reversal day then yesterday was the worst follow through day in history.
Stocks like GOOG stil look broken and ETF’s like XLE, XME and XLK all failed yesterday at their 20 day moving averages. There is still a ton of liquidity around and the performance chasing monkeys may still want to bid things up before the quarter ends next week. Stay tuned, it’s getting interesting.
My subscribers took five solid gains yesterday including a 25% gain in ZAGG which we went long about ten days ago. We continue to play this difficult tape well. If you would like more information about my site or would just like to review my performance, then email me at [email protected]
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