Morning Audibles 7.9.10 - Prepare for The Prestige

Doesn't it just seem that way?


You all know what "A PRESTIGE" is, it's ACT III of a magic act, it's where the magician has carefully drawn in the rapt attention of the audience and then lowers the boom... Well here, this describes it...

We all know (or should know) that the MARKETS are not, I repeat ARE NOT the ECONOMY... That's why we can have weeks (short 4 day ones) as is the case of this past week, that the magicians have many rabbits in hats, and aces in sleeves to keep one distracted... 


The thing is this... "Timed" correctly (and every good magician knows that timing IS, THE, key element)... The illusion has time to grow in peoples minds (believing it is real)... 


Frankly, this started with some late day maneuverings in the S&P cash before the 4th of July holiday even began... A kick save to the market to prevent it from dipping under 1000 and bumming everyone out... A 3 day weekend ensued, whereby FUTURES were already looking at 1002 before the Tuesday open... Somehow, a save was managed there as well, and Tuesday opened strong (only to falter)... The "propaganda" machine was then turned up (as famous bear "Doug Kass" comes out with  a "the low is in" call), and what? a decent LUXURY GOODS report?


By Wednesday, there is a huge "meltup" (on crummy volume) which takes the indices over what had been some technical levels (of questionable importance, more "psychological" in the grand scheme of things)... Followed by another meltup (on even CRUMMIER volume) yesterday... 


So now we're here on a Friday again... The chatter will surely be about "shorts covering" into the weekend, Monday meltups (as they have been particularly favorable for BULLS since 3/09), gap closures, good earnings season rumors, successful stress tests in Europe, etc.


Frankly, if you're a BEAR, this is what you want... The last thing you need is negative talk on a day like this... You want BULLS going home happy this weekend...


But the REAL TRUTH is... As far as much more upside potential is concerned, there's no where else to go...

Different people have different numbers on this... Some of those numbers range from the 1070 level on the S&P, all the way up to 1110... (CV - FWIW is "hoping" to see something in the 1080-1084 range)... It'll look like the bulls will have cleared all hurdles at that point, but then, Cleveland fans, you're superstar will hold a news conference and telling you he's skipping town to go join his buddies in South Beach... It was never about YOU and your HOPES and LOYALTY anyway... 

Had you fooled there... Presto! Change-O!