A Bad Day for the Bulls

It looks like we have a very serious break in the market driven by fundamentals. Last night I said I couldn't do the EU problem justice in a few pages, now it's flowing so fast, I doubt I could even keep up with the developments, out of the US as well.

These problems are bigger then the Fed's POMO, meaning the potential for adverse effects can not be offset by the Fed's POMO. The EU is literally facing the prospect of completely unwinding as member states are breaking off and making their own policy decisions with regard to many issues, but especially the bailouts.

I have been asked many times "Why would the dollar go up with Fed POMO/QE2?" in many forms, my answer is as usual, I'm not that smart, I don't have the inside information, I am just showing you what it looks like the insiders with the information are doing. It's very difficult with 3C divergences because you can not attach a set of fundamental reasons as to why, when the divergences first appear, that is why I say, "I have learned not to argue with the charts, the news will come out later", but if you wait until later to take it seriously, you missed the advantage of seeing what smart money was doing.

Tomorrow, 10 a.m. I have a doctor's appointment so I'll miss the opening, I'll be back before noon. Tonight I'll give you the best analysis I can and ideas. Right now, the Trend Channel i showed earlier today has stopped out the averages trend up. So I think, even though we can still get a bounce, we are looking at a serious reversal. More tonight....