Thar' She Blows

Yesterday the market managed to hold after the initial plunge, but hold nonetheless after the Chicago PMI and Dallas F_E_D reports (PMI was a HUGE miss, Dallas was a respectable miss). Today as ISM is reported the market flies on the initial release.

 ISM beats, even the high range of consensus.

 Here's the ISM trend.

ES explodes to the upside.

I totally forgot how many vacation days Europe has, with the May Day vacation, yesterday's accumulation makes even more sense, but I still have to wonder whether smart money was willing to throw that extra support in because Europe wouldn't be too much of an issue today or whether they may have had some forward looking knowledge about ISM, yes, traders are paranoid, in my opinion not paranoid or skeptical enough. Just listen to Jim Cramer on how he use to manipulate the stock market as a fund manager in his own words. Yet this guy calls himself the champion of the small folk? I could share more than a few stories about what he has said and how the market used to to dump all over his audience.

When I taught Technical Analysis I started every first class with this video and you should have seen the disappointment and disbelief on the students' faces. If I had told them this is how the market works, maybe 1/3 would have believed me, coming from their former hero, Cramer, it was devastating, but gave us a new foundation to build off.