Key reversal? DDHigh 10580 support or resistence?

24FEBDJI: Trading at BDD 10440, acting as the short term resistence level.

20JANDJI: Trading at DDHigh 10580, acting as the short term support level. If the DJI breaks DDHigh on the downside, short term support level is BDD 10440 ( -1,4% ).

Since DDHigh is the long term resistence level ( from "week chart" ), I do not get any deviations at higher levels in my modell. Taken this into consideration, it is an exremely nice risk reward, selling this market. DDLow 9580 (-9,5%) appears as the long term support level.

Awaiting the market to trade at BDD 10440, as the WVAP ( Volume-Weighted Average Price ), for 2010, and to bottom out in late April-May ( " Sell in May, fly away" ) at DDLow 9580. If this is a Key Reversal and the BDD fails to support the market, I would expect a sell off, with the target at DDLow ( -9,5% ).

Whats happening next?

PAY BACK!!
" The Invisible hand, suddely gets very Visible " ( PAY BACK! ): Desperate times calls for desperate measures. Capitalism is a system depended on growth to function, and is a system where the "strongest survive". Now when the goverments all over the world, has bailed out the the weak, it threatens the evolution of capitalism and creates disturbance in the force. The stimulus plans made by different countries, will only make the reseccion time longer and deeper. We have to let nature run its course, and the weak go down with it! No its PAY BACK time!

Rescent earnings repports show that the equity owners has to get used to lower yields, in the financial sector especially. When FED overflows the market with greenbacks, it finally ends up at different EBITDA`s showing inflated corporate growth. When the FED now has its rate range at 0-0,25 and the dynamics of export/import balance between Mother China and US is gapping, the FED has no instruments, other than printing money, and buying expencive ( already inflated ) equities and bonds.

USD appears to be the new carrie trade, inflating allready stretched commodity and assets prices, for net. importing nations, with low organic growth in GDP and without high government spending, especially, this could be devastating:(Y = C + I + G + (X − M)). This phenomenon could in the end, shut down "parts" of Capitalizm, as we see it today. Due to the fact that the china man ( google money ), with their underlying growth prospectus at high/low 12%/8% y/y, and with their undervalued Yuan, always can afford higher commodity prices , and with that strangle the US economy, outpacing them exponentially, beeing the "derivative" ( high delta ) of the US economy.

I`m not an expert, so I`ll let them speculate on whats gone happen to the market and macro fundamentlas. I do not know if we in the future have to look at capitalism in a different way, with different spreadsheets, models and theories, but to me it looks like mother earth can`t handle much more input to the pyramide (( a new middle class in the east, where the productivity growth input is Oil ( "Peak oil theory")), without technological progress. Boom or Bust? Iran next?

Buy Tech!

TMTMAN

"It takes a man a long time to learn all the leassons of all his mistakes. They say there are two sides of everything. But there is only one side to the stock market; and it is not the bull side or the bear side but the right side!"

Jesse Livermore

Seeking Alpha17feb: Is China Tightening? Not Really

Terminology: My Dynamic Theory