POMO Has Ended

And to show what a scam this whole process has been as well as a boon to the Primary Dealers, today's last Permanent Open Market Operation (POMO) just concluded.

The Fed monetized $4.909 Billion in treasuries and with no reason to try to make this farce look legitimate as it just ended, of the $4.909 Billion the Fed monetized today, a whopping $4.405 Billion was earmarked for the 7 year that Primary Dealers just picked up yesterday! That's right, the vast majorty of the operation bought treasuries that PD's didn't even hold a full day! Of course the PD's flpped these overnighters at a profit.

With QE2/POMO now in the history books, the questions still remains "Who's going to take up the space the Fed has occupied for the better part of the last 2 years?" We've seen the indict bidders fleeing the Treasury auctions lke rats on a sinking ship. This should be interesting.

In the meantime, the Treasury bear ETFs I mentioned earlier in the week as this newly emerging trend started, are still doing well.

 TBT (Ultrashort 20 year Treasury) breaking the 50 day on some volume.

 The Trend Channel with a daily stop around $33.50

 3C 60 min chart, looks as if this change has been in the planning stages for awhile.

 Technically I prefer all 3 signals to go long, but 2 will do. Look for the first pullback to the 10-day moving average which should be around the same level as the trend channel-$33.50 or so.