The State of the Trend

By: George Krum | Sat, Mar 23, 2013
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A lot has been written already about the Cyprus fiasco, but we believe one more angle should be considered: that episode gave us only a little taste of what to expect when the Fed makes its next faux pas, the difference being that the drop down the elevator shaft will dwarf last Monday's tiny sell-off. The chart below shows what's at stake:

If history is any guide, the question should be when the Fed will make a faux pas, rather than if. Whether they initiate on their own a clumsy attempt to put an end to the perpetual QE, or whether inflation and the economy force them to do so, confidence in their ability to engineer a graceful exit is near zero.

In the meantime, enjoy the ride, as the daily, weekly and monthly trend for the SPX, NDX and DJIA remains up:

For those who worry about continuing spillover effects from Cyprus next week, the intraday SPY chart below points to the key levels to keep an eye on:

Key DOW Levels Chart

That's 1535 - 1560 for the SPX.



George Krum

Author: George Krum

George Krum

George Krum is the author of the "CIT Dates" blog, and the following apps:

OddsTrader - combines the power of Hurst Channels with proper risk and position size management. For a web version see OT Signals below.

Gann 9 - the only financial app that allows users to effortlessly apply the legendary W.D. Gann's tools and methods for trading (including the Square of 9).

OT Trend - helps you quantify and forecast the seemingly random ebb and flow of stock, index or mutual fund movement.

OT Fibonacci - automates the process of applying Fibonacci numbers, ratios and time series to any security.

OT Seasonal - allows you to perform seasonal analysis on practically any security from around the world, and to build long-term forecasts and models.

OT Pairs - pairs trading, one of the most successful hedge fund trading strategies, is now available on your smart phone.

OT Pivots - combines the power of pivot lines with cycles to provide you with concise technical analysis and powerful trading signals.

OT Signals - a web app accessible from any browser, tablet or pc. It gives buy/sell/hold ratings for any instrument from around the world, and defines the trend and support/resistance levels.

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