The light blue lines haven't budged. They're the same lines I drew months ago live in class and the same lines we've been watching in class. No I have no power over the market. This is the legitimate predictability of the market. Is it a wonder we traded straight up to both the roughly 45ยบ down trend AND the 7500 horizontal resistance line? No. Simply put: this is what should be expected.
So why do I sound so ticked? In a word... GOVERNMENT! I should stop my rant here... but.... oooooo... they can't stop me.......
Friends - DO NOT BE DECEIVED... Congress is going nuts over AIG execs getting huge retainer payout... $165Million + To be exact! No chump change to be for sure, but there are two BIGGER stories that are happening that congress is managing to hide with this AIG story. In fact, when you consider the other stories developing the $165 Million paid out to AIG execs is just straight up chump change. $.10 on the dollar compared to cover up #1:
Cover Up #1
As a trader I care about the value of the dollar... After all most of my profits are made in dollars (at least up til now they have been). But yesterday's Fed announcement is potentially devastating to the value of the dollar. Literally printing over $1 Trillion! The $165 million scandal at AIG is chump change at best, if even worthy of being called chump! Following Big Ben's announcement yesterday the dollar has been falling quickly against other currencies, and of course Gold is beginning to take off soon to break highs from last year. This story is 10x bigger than the AIG story, and congress knows they are to blame. Without such massive government the economy wouldn't be in such trouble. Basic capitalism would have corrected the impending doom and we would likely already be on the road to recovery. But with government growing on an exponential scale almost daily, what could have been a recession, is quickly turning into a depression. And what could be a mere depression could turn into complete economic destruction.
Cover up #2
The second cover up which is getting a small amount of media coverage though not nearly enough, is the fact that the US House passed a bill today to enact a RETROACTIVE TAX on the AIG officials who recieved bonus' as part of the bailouts.
Now don't get me wrong, a bonus for failure is downright stupid, and it's a worthless use of anybody's money - especially tax payer money! But the US House wrote a bill today that is in direct violation to the US Constitution. Article 1 Section 9, Para 3 United States Constitution: "3. No bill of attainder or ex post facto law shall be passed." This means the government can't go after something after it's happened! And yet not only is congress going after it, they're going after it in an attempt to clean up their own mess!
Congress gives the money - Americans hate it. Congress writes provisions for the bonus' - Americans hate it. Now rather than just standing up and saying "we are too big and have no clue how to be capitalists," congress is continuing to meddle in the economic world by trying to create laws that are a direct violation of the US Constitution. And not only that, just like every other bailout/stimulus/ waste of tax money they have passed over the last 6 months they rushed this through without even a hair's breath chance to read the bill. And I promise you when all this news starts to trickle out into the capital markets over night tonight, and into tomorrow, America is going to hate it! And the Dow? Well if the mere fact it was hitting resistance isn't enough reason to drive it lower, this news will pound it back down to 6600 probably before the end of next week.
Friends this is JUNK. I try to keep my politics to a minimum but it's time to stand up because everyone who trades the market, everyone who believes in free enterprise, everyone who believes in the American dream - the chance to over come adversity and be more than your family generation before. The opportunity to excell through the power of humanity, not through the power of government. Everyone who believes in a brighter tomorrow... should be ticked. The governement is trying hard to steal your opportunity.
So what can you do? First write your congressmen, senators, and president. Democrat, Republican, Independent. Tell them if they vote for these measures you're firing them. Then follow through. This is not a partisan statement I'm making - this is an issue of governement of the people, by the people, gone amuk. Governement is here to serve us, not the people serve the government.
Second - CNBC's Rick Santelli started the idea and now across America citizens are planning tea parties in protest. Join the April 15th tea parties that are being organized around the country. Protest taxation. History tends to repeat itself, in both the stock charts and political history. The last tea party was in 1773 in Boston against the Brits... The next Tea party is across America, against the US Governement.
Thirdly - Educate yourself and learn to trade the market effectively. In response to recent governement actions we are taking steps at The Financial Puzzle to expand our training beyond simply the US markets to include both Foreign Exchange and Foreign Markets. In the mean time all of the technical analysis taught in our Foundations of Stocks and Options class will transfer to any market. Learn the basics and then apply it to the next market you choose to trade.
For those who are not prepared, adversity can sink your boat. But for those who are properly trained and prepared adversity can present the opportunity of a life time. Right now is one of those opportunities! Don't waste this chance to make great US Dollar profits while the market falls, and then transfer those profits into foreign markets as inflation kicks in. Retire smart, not desparate.
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