WEEKDEND CHART "Transporting to where?" Or CAVEAT EMPTOR?

*click to enlarge chart.

Dow theory relies on Trans and Dow complimenting each other and confirming any significant move. The Transports have vaulted from the lows but couldn't better 2009 highs recently and has shown sigificant weakness vs the Dow or SPX (500 top companies).

You can also see how the DECLINING 200 EMA (exponential moving avg...takes into account price action close to end than beginning of time period) has acted as repellant to the advance.

The 50 EMA not shown here has crossed UP on some of the indexes, causing a stir in some professing NEW BULL MKT. My own studies show that when this occurs in a bear mkt, with the 200 EMA still declining, is usally near the END of the rally. (makes sense as it takes strong action to bend up the 50 EMA)

The current rally is now 4 months old.

What we do know is in the early stages of bull markets you get a SWIFT expansion in buying intetrest, volume and breadth. After MArch came and went, L stats show this enthusiasm has been waning as at a rapid pace throwing us near all the way BACK to when the rally began!

Selling aggressiveness has pulled back but it is now only 8 pts away from signalling heavy defensive postures would be prudent.

It is my opinion that STIMULUS money (when all else fails) has been making its way from the chosen 10 or so, into the stock market. There has been some questionable action near the END of days and IN FRONT of FED news or actions....seemingly coming out of nowhere. And the SEC is not even a bit interested in finding out if any INSIDER TRADING is going on. SO how else can a market go UP, without buyers en masse?

With such lithe buying interest, if SELLERS should get a pair, the market could turn tail IN A HURRY.

We also know, as obvious as it may sound, that BEAR MARKETS do NOT END until they make their final low. If the action of the last 3 months of the BUYERS stepping away uncharacteristic of ANY PREVIOUS NEW BULL MKT, then I can only deduce that the probabilities exist in favor of a bear market alive and well, and its final destination LOWS somewhere ahead of us.

And if nothing less, a TEST of the prvious low is coming, all IMHO of course.

Savings rate has been rising, and this may not change overnight, this behavior from consumers we need to spend.

There is a survey called the "Business Roundtable" where ONLY CEO'S are polled, 51% expected LOWER CAPITAL INVESTMENTS (fuel of recovery) and 49% expected REDUCTION IN PAYROLLS

So if market is forward looking, is it pulling wool over our eyes? Or this is phrase just BS hargon?

FED wont tell us or doesnt know where all the $ billions we gave them went? So we should feel comfortable this FOR PROFIT caldron of thieves has our back?

Lastly, with my hunches the top is in this relief rally in an ongoing BEAR MKT, We have end of quarter marking up so the henchmen doofuses in charge of your money can get their bonuses and look good....June is quickly coming to a close.

We are in the "bad 6 months of the market" sell in May go away.

In the next few weeks the monthly unempoyment numbers will be coming out, with last weeks "SUPRISE" 627,000 new claims, and we see with our own 2 eyes.......isn't the unemployment rate going to rise?

It currently rests in a believe it or not 9.4% and 6.74 Million jobs lost!!!! Are we going to create MILLIONS of jobs with the STIMULUS? GREEN JOBS? JOBS that and the industry cannot survive on its OWN accord without Government SUBSIDIZING. WILL it just shift jobs from oil to solar panels and such?

Should everybody do the right thing and have our gov tell us what kind of car to buy?

WILL it be around this report, a number so onerous, that any smoke screen put out, any illusion that the economy HAS turned the corner will be smacked in the face?

And from that point do we make our way to that MArch low around the time most known for ugly market performance (OCT) and market lows too.

This pretty much drains my brain for this weekend. traffic to my blog has most definately nearly doubled the avg of just a few months ago, I may not SEE you (cept Google analytics) but I write for you.

Duratek

Jobless claims