A Strange Market

I have said today and maybe yesterday that this has been a strange market. One reason is that there have not been comparable era's to measure against, this is the first time  can remember the market being in the position it is in with so many underlying currents that can not be factored in to a reasonable comparison, for instance, the situation in the EU, rumors of Nato preparing for a strike on Syria based in Turkey, the extraordinary monetary policy accommodation, price patterns saying one thing and underlying conditions very much at odds with them (which is not anything really new for us) and now rumor after rumor.

For instance, yesterday the late day rally was widely credited to a statement from EU finance ministers that didn't amount to anything more then the same statement they would have made going in to the meeting, after all, increased cooperation which was the basic statement was indeed the point of the meeting. I warned that there are always a bevy of pundits, trading firms, news organizations and popular blogs that all chime in. In last night's post, I showed you completed positive divergences that would likely have turned the market higher and they were in place an hour or more before the EU finance minister statement, showing that there was some other reason that the market was preparing for a big move, before the meeting was over.

Today the "Reason for the rally" according to ZeroHedge, who incidentally said yesterday the reason was because of the EU Finance Minsters statement, says it was because of Morgan Stanley who gained 12% yesterday in late day trade.

The web-figuratively and literally is very twisted and as ZH is becoming more influential, they are now moving markets or at least stocks.

This article will explain a lot about MS and ZeroHedge.

Furthermore in ZeroHedge's latest reason for the rally, they cite some pretty incredible bits of data and claim that MS not only leaked their numbers two weeks ahead of earnings, but those of GS as well, this is in the title of the post. As the New York Times article points out, the ZH article put out was written by an anonymous blogger with no way to reach them to set facts straight, so the MS response had to go through a PR campaign and likely the rumor mill.

Reason For Latest Market Rally: Morgan Stanley Leaks Own, Goldman's Numbers

It is expressly forbidden to leak earnings ahead of time (although as I have shown in the past with an earning season example of this in which I used 3C to correctly predict 95% of 22 companies reporting). However, doing so in such a public way as well as having access to Goldman's numbers to boot, seems a bit unlikely.

As for MS, who had been taken to the woodshed with most financials this week, it appears something was going on before yesterday's story.

 This shows about 2 months of history on the 15 min chart, you can see accumulation leading to rallies, distribution leading to declines, but more importantly...

 Just looking at the recent accumulation, something was going on here before yesterday or even Friday, this is 9/2 through today at the white arrow.

 The 10 min chart also shows something was up, maybe their planned campaign?

The 5 min chart is similar.

As for GS...

 This long term GS chart shows the last hurrah for GS in 2010, confirmation of that trend up until it wasn't confirmed anymore (red arrow), the downside is confirmed in the green arrow, as to the white lateral, I don't know, it's a very long term chart-3 days

 The 60 min chart shows the last rally attempt with no accumulation, the ended badly and downside confirmation until recently. There's a positive divergence, then a bounce and a negative divergence.

 Here's the 15 min chart....

And a closer view, gap lows were accumulated and a move up from there, ironically another positive divergence just before the big move up, that same move that was supposed to be Morgan Stanley's exclusively? Not to mention the market divergences. 

It's too twisted and convoluted for me to make head's or tails of.