Guys, wouldn't THIS TOP RANGE be the area of resistance next? 10,753-10,984
My guess is approaching 2004 top we had the FED beginning to move on rates, they didn't move fast enough and 2 years of BASING, CONSOLODATING initial burst of gains off 2002 lows led to final explosion top into 2007.....as internals were deteriorating.
AS some subs have pointed out, you will get this divergent activity WAY in advance of THE TOP.....friends, this time it will come with MUCH less impact to the labor force.
I see pullback began at 1169 (previous chart), breaking 1150 shouldn't change anything. Extension of the highs based on what I see here would see unlikely, when you figure how far we have come and the economic data is not as vigorous as during this time period....I mean jobs were being formed, economy was HUMMING.....now bigger rally less humming, no jobs.
The ONE standout in ALL THE data is the APRIL 2009 HIGH in the 30 day up and down volume, not consistent with ANY previous BULL MKT this first month high then one year declining trend .
I found out why a new neighbor never finished building his home. The banks just loaned him $1.4 M for our warehouse, he got $710,000 in 2005 for his residence, tore it down, began building a home 2X the size.
He has done NO work on electrical, plumbing etc for one year...now I know why...banks will NOT lend for construction loan....so he must pay out of pocket to complete project.....THIS IS CRAZY.....loaned him $1.4 M for commercial...but nothing to finish home. He has a RESTORATION Contracting business, he seems to do really well.
It is plain sight in charts showing Bank Loans outstanding CONTRACTING, this is one of my biggest beefs...you cannot grow economy without that changing....
We got lots to do to see this little start at revival to catch on, create jobs, allows for increased spending, investment...and on and on...
Best of luck to all, hope for the best....plan for....
Duratek
2 comments:
I think banks are pulling in their horns and holding cash to beef up their deposits. The last thing they want is more exposure to real estate; they are holding/hiding huge losses on the books. The supply/demand picture for residential and commercial property does not favor bank lending any time soon.
Anyone holding property for appreciation with the intent to sell at a profit is over a barrell.
At least with stocks you can unload with the push of a button.
By the way I see that the retail consumer has marched from stocks to Bonds - that is the next powder keg to blow up.
More money was lost in Bonds than stocks in the deflationary 30's. I don't imagine things will change this time either.
The money was lost in stocks in 29 then 17 months later the bond markets began to tank. That would be April of 2010 as a start date should history be symmetrical.
Cash is king.
Well said. With deflationary back drop bonds still hold up, in particular certain corporate bonds .
Stocks getting that liquidity flow. Can scratch head but game still on.
Short term set up for retrace, hold breath oh boy health care bill.
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