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In trying to explain to someone what a 'confirmed breakout' from a symmetrical triangle' might look like, I have decided to draw the current formation, within which US equities are coiling, as 'flags' rather than triangles.
These flags are a little simpler to see on the chart, as they are quite consistent with the existing lines of support and resistance. I also think we have now reached that point in which if they break down they will fall rather decidedly, probably based on some precipitating 'trigger event.'
The most likely candidate for this is a deterioration in sovereign default.
We are approaching a holiday weekend in the States, and the close of June and the second quarter. So painting the tape, and prepping for a few more IPOs to be squeezed out like Hudson River brownfish, will be the order of the day, but with the looming shadow of another financial crisis making the players uneasy in their ill gotten gains.
Don't get me wrong. These jokers do not give two hoots for the common people of any nation. What concerns them, occasionally, is getting caught. Or even worse, cut off from the airport by pitchforks and torches. But they rarely think that far ahead.
A few seem to be waking up to the irony. A drumbeat of corporate persuasion that is noticeable to those outside the culture, and those who have switched off the propaganda feeds on the internet and in the mainstream media. But the illusion is unnoticed by those seeking an escape from complexity and the uncomfortable in simple solutions and slogans, quickly mouthed as a subtitute for thought.
"If we understand the mechanism and motives of the group mind, it is now possible to control and regiment the masses according to our will without them knowing it."
Edward Bernays
If a 'reformer' does not speak to the need to reform the financial system, the huge advantages and subsidies being given to the corporations and the ultra rich who control them, it is a fairly good indication of what sort of a reformer they really are, and who is pulling their strings.
There is a massive tax avoidance scheme being conducted, for example, by multinational corporations that use accounting methods to accrue income to tax havens overseas, and shelter their cash from income taxes. With the occasional tax holiday for which they fund large lobbying efforts, they can bring that cash home for tax rates much lower than you might pay, and then give the proceeds to their executives and shareholders as tax-lite dividends and capital gains. It does not take much of a presence or actual sales in any tax haven to do it. A mailbox, an attorney, and an accountant are enough.
As an individual, try shifting your wealth capital overseas, and avoid paying taxes on the capital gains and the interest. They don't make it easy to say the least. But corporations can establish branch offices in tax havens and use loopholes to avoid paying most of their taxes from operations across the US and around the world.
The problem is that corporations have become much more powerful and important than individuals, favored by the politicians on their payrolls.
You are responsible for what you watch, and what you put into your mind, even when it feels comfortable to be part of a mob. The mob will take you to places that you do not wish to go.
As for those who wish to use it, the madness serves only itself. People will kill their neighbor and poison their children, before they will admit that they were wrong. They have no love in their hearts, only lust, greed, and hatred which they call love, because they serve only themselves and dark powers.
And at the end they will say, 'we did not know.'
Salon
America's unique hatred of finance reform
By David Sirota
"Despite the moment's anti-union/anti-government sloganeering, the American employees who are paid the highest publicly financed salaries are not state and municipal workers -- nor even our $400,000-a-year president. That distinction goes to the bank executives who are now being paid record salaries -- salaries that continue to be financed by ongoing taxpayer-sponsored bailouts (and yes, huge bailouts are still happening).
We don't hear much about this because the United States government still promotes the fallacy that our banks are not publicly subsidized institutions subject to requisite public control like, say, a utility company might be. Instead, despite all evidence to the contrary, Washington pretends that these are corporations operating in a free market, ignoring the fact that an actual free market would have destroyed many of these very same entities back in 2008. Nonetheless, the nonsensical free-market apocrypha lives on because it serves such an important a purpose for banks and the U.S. politicians they own -- namely, to successfully thwart the push not just for full-on bank nationalization, but for even minimal financial regulation.
So astonishingly successful has this farce been that our domestic debate about spending and deficits today is somehow primarily about demonizing the publicly financed five-figure salaries of teachers, police officers and firefighters, rather than about reducing the publicly financed seven- and eight-figure salaries of Wall Streeters. In Fox News parlance, the former are simply tarred and feathered as the takers in an "Entitlement Nation," while the latter are celebrated as the earnest John Galts who are keeping America afloat.
Against the backdrop of international politics, the unchallenged dominance of such a narrative in this country has become the most powerful American exceptionalism of all -- it now literally separates us from most of the rest of the industrialized world. Indeed, while our pro-corporate ruling class tells us to fear the shrugs of Wall Street's supposed Atlases, the same fears are being outright rejected by many other industrialized nations in the post-meltdown years -- even those with relatively conservative governments..."
Read the rest here.
With the dollar down, stocks up, and gold and silver down one might suspect today was an option expiration day in a delivery month on the Comex.
And so it was.
Greek vote on their bailout plan may move the markets later this week.
I put the long gold/silver and short stock indices trade back on today at an opportune moment in honor of the anomalies provided by an option expiry.
Eyes are on the Greek bailout vote.
Light summer volumes.
The US equity markets are coiling within obvious symmetrical triangles. They will break up or down, and that break *should* mark the next leg once confirmed by a daily close or two.
The SP 500 cash market has been finding support around its 200 DMA the past week. Traders are watching this carefully, as well as VIX, for the signs of an impending break lower.
I did add some index shorts intraday.
