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Monday, May 31, 2010

This Month in charts

This "week" in charts, I took a step back and pulled the charts to a longer view. Context of where the markets are in the longer view may help highlight where we are going. Upshot: Up or down from here, but LONGER term, still looking grim. We could be about to hit the final parabolic blowoff or that has already occurred and we are about to witness the final downturn. Who the heck knows. :) To the charts!

First up is the S&P 500. I changed the view to "Monthly candlesticks" instead of daily. Notice this past month as a really decent sized big red line. In an upward market in 95-2000, then 2003-2007, notice the only time a really large red line appeared was in the middle of 1998.

But in the down markets, there are plenty of large red lines. Although this isn't proof we are in a larger trend down market, it is in indicator.

Next up is US 30 year interest rates. Notice the yield has recently collapsed. When was the last time we saw a trend change like this? why 2007, near the market top. Back then the market moved higher after rates changed direction before the market started to retreat. So again, while this is not proof of any sort of overall market change, it is an indicator.

Last up is gold. Pretty much in a bull market for years. Does it mean gold can't have a huge collapse, of course not! But it has a pretty good track record since the world of fraudulent financing really took off to continue to advance.

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