Also Breaking-well WOWS members shouldn't be surprised.

Despite the allure and mainstreams fascination and love affair with the idea of emerging market long positions, WOWS has been on the bearish side of Emerging markets. I have argued that they will aggressively fight back against the hot money flows that raise inflation in their economies, which now creates the following calculus (hot money flows to emerging markets=inflation=protests and food riots=regime change).

I have said in the last week or so that China will raise rates in February and they did. While China is not what I would consider an emerging market per se, it is reflective of the actions that will be taken in emerging markets.

Besides raising rates three times in little over a month, China has now hiked their banks reserve ratio requirements meaning the are draining liquidity out of the system and fighting the Fed fire with fire.

This could emerge to be a thematic conflict through 2011 and America will soon feel the pain from Fed actions in another form.

Don't forget our China 25 bear trade, FXP it's been performing well.

Mubarak Pulls a Fast One...

And perhaps a very dangerous one. All indications from the intel sites I've gathered have shown that Mubarak's failure to step down was a surprise to everyone from Washington right to the Egyptian Military regime itself which is now faced with some very difficult choices as dawn in Egypt approaches.

The military has few options, none very appealing. The military regime that has been in place since Nasser is now in a very dangerous position. Should the crowd of protesters coalesce behind a leader of the movement, the military regime will have huge problems especially as they are now in question among the protesters as to where their loyalties lie, that has not been in question yet as the protesters have identified with the military and seen them as part of Mubarak's removal.

You can be sure the military is now redeploying to contain protests and taking positions around the presidential palace.

First the military could stand back and let events develop while trying to maintain some semblance of order and hope that a universal figure head of the anti-Mubarak protests does not emerge. Second they could support Mubarak until September and perhaps be drawn into conflict with protesters. Third and in my opinion most likely, they could remove Mubarak by force or a coupe. What is apparent is that a decision will have to be made within days if not hours.

Considering events in Saudi Arabia where the king is said to be dead, the extremist must view this as the will of God. Suddenly the world just got a lot more dangerous. Expect the market to discount this uncertainty and we will see how committed the FOMC Jedi council is to levitating the market in the most uncertain of circumstances in the most volatile region of the world. Their credibility is at stake n more ways then one now.

EEE getting ready to make another move higher

 EEE still remains on a long signal and the typical pullback to the 10-day moving average has taken place (yellow line). I'd prefer a stop at the blue 22-day moving average.

 Here's the 30 min chart showing distribution of the last run.

 The 10 minute chart shows renewed accumulation

As does the 5 min chart.

If possible, I'd try to even pick up some shares in after hours if available at a decent spread.

Looks like manipulation

The selling was real in my opinion, who would buy into this kind of uncertainty? There's wide open visible volume, it seem the PPT was bent on keeping the SPY from continuing down.

If there's one thing that spooks the market, it's uncertainty-as you can see by the downside volume as it became apparent Mubarak wasn't leaving, the market didn't like the uncertainty. Who in their right mind buys that uncertainty? The Fed.

Ever hear the saying, "When the missiles fly, it's time to buy"? It's not because of war time profits, it's because the uncertainty of war has been lifted and the market can start properly dicounting events without the uncertainty of whether it will or will not happen. This is just another example of PPT/FED manipulation in my opinion, the same kind of garbage that is putting this market in a situation of increasing risk. They don't want the "buy the dip" crowd to lose confidence in the Fed's Jedi market powers quite yet as the end game is still being mapped out.

Sorry if I sound a little emotional, but I find this disgusting.

Here's the opening for the Muslim Brotherhood and perhaps more radical factions. I'm going to look for the high beta/weighted stocks they manipulated the market with.

He's trying to create Nationalism

He keeps talking about Egypt and how it won't be dictated to, how it will decide it's own fate, apparently with him leading the way. Who is the enemy he seeks to turn the people against?

He also has given a testimony to himself.

He "will not separate from the soil until he is buried underneath"

Oh boy, talk about a spark-this was a firecracker in the gas tank. He's not leaving.

Why the SPY just caught a bid, IDK?

Trouble, meet Egypt.

Market Reacts

I have to wonder if this was pre-recorded, I have to wonder if there was a run up-with obvious volume (not the way institutional money accumulates) to set up shorts as they may have had information as to what was to be said.

Remember I wondered why the Suez was being guarded by the Egyptian military and why the US was sending landing attack ships.

USO is tentatively moving up.

Oh Boy

He's contrite (Mubarak) but doesn't sound like he's going anywhere soon

I wish I had 10 more set of eyes

Don't be surprised to hear about SEC investigations into CSCO insider trading probes in the months ahead as 3C shows institutional money bailing out of CSCO before earnings.

And more

Egyptian military forces have secured the Suez and ar escorting transiting ships, meanwhile a US marine attack ship is on the way. If Mubarak is to step down, why the increased concern over the Suez?

Just a week or so ago, armed thugs (suspected to be police/internal security forces in plain clothes) started a lot of trouble in the area, taking out police stations, etc.

More Confussion

Stratfor says there are reports Mubarak has already left the country and the speech is pre-recorder????