Bad News = Good News For QE3

Bad News Bears

• 'Double-Dip' in Housing Prices Even Worse Than Expected

• Watch For A Weak ISM Number Tomorrow

• Consumer Confidence Takes Surprise Drop in May

• Europe Weighs Options for New Greek Package

• But This Is All Good News Because Now The Fed Will Have To Do Another Round Of QE

Update on the over all market

SP-500 - Weekly

• SP-500 Still Holding Support In Bull Fork
• In a Neutral Zone At The Moment But Should Bounce
• SP-500 Could Still Have One Last Pop
• Close Below 1310 Would Start To Be Bearish

GLD - Weekly

• GLD Still In Bull Fork
• Having Hard Time Breaking Mid-line @ $149.00
• Close Below $139.00 Would Be Bearish

QE3?

• Been A Good Amount Of Poor Economic News
• Economy Is Slowing Down, Keep In Mind That Is With QE2 Still Taking Place
• QE3 Would Not Help, Just Kicking The Can Down The Road
• What To Watch Is Greece, Aka "Lehman Brothers 2.0" And China! 

Break Down?

SP- 500 Weekly

• Need To Watch The Lower Part of The Bull Fork
• Close Below 1310 Would Show Market Is Breaking Down
• Close Below 1300 Would Be Very Bearish

XLF Weekly

• XLF Is Breaking Down
• In A Major Bear Fork
• Banks Will Lead The Market Lower, If They Do Not Turn Around Fast!

No QE? Then Watch Out Below

• Consumer Can Not And Will Not Hold Up The Market
• The Fed Has Kept Us A Float
• Fed Has Off Set The Falling Consumer, But This Looks Like It Is Coming To End

What Could Happen When QE Is Done

• In Short, NOT GOOD
• Time To Be Smart With Money, Not Brave

Update on the over all market

SP-500

• SP-500 Starting To Break Down
• Break Below 1300 Would Be Bearish
• Still Room For The Market To Go Higher 
• All Comes Down To QE3

UUP

• UUP Trying To Break Out of Bear Fork
• If The Fed Does QE3 UUP Will Go Lower

XHB

• Housing Starting To Break Down 
• XHB Just Broke It's Bull Fork

Perfect Strom

Here is a link on something to watch this weekend.  http://www.businessinsider.com/greece-considering-leaving-euro-2011-5

If Greece really does move away from the euro or defaults, it will be the start to the euro's down fall. If Greece says we do not have to pay you back, then the rest of the PIGS could follow.  Which in turn will shut down many banks overseas and here in the states.  The perfect storm is starting to brew.

About that Housing Market

Home Prices & REO's

Home Prices 

Housing Starts

• Home prices are still falling like a rock
• More homes are coming on to the market, which will only bring prices down
• Large amount of REO's taking place and new homes still being build
• Lots more supply then demand
• Hard to buy a home if you do not have a job
• Keep in mind home prices are still falling even with all the money the fed is spending
• What will happy to home prices when interest rates go up?
• Time to shorting homebuilders soon?

The Big Picture "Top in the market could be in soon"

Profit Margins 

• Earnings have been very strong over the past year
• Much of this has been due to better profit margins
• Margins will start to feel the pain of higher oil prices
• If companies start ever hiring, margins will go down
• Market still could go higher into the summer but a top is near

Update On SLV

SLV

• Hit the bottom line of the fork and holding
• Covered (20% in 4 days, do not be greedy)
• All commodities  are falling due to the dollar
• Break $35 on the SLV would be very bearish
• Funny how thing can change so fast in a week
• All the down side in SLV, GLD, and the USO could be off set by QE3

SLV-Weekly & SP- 500 Weekly

SLV

• SLV has broken mid-line and 200 DMA
• Moved up stops to lock in gains
• Break below $37.00 would be very bearish

SP-500

• New bear fork starting to take place
• Break below 1285 would be a very bearish sign
• Top could be in "IF THERE IS NO QE3"
• All will come down to jobs report on Friday
• Could see one last run up in June

Update On SLV

SLV

• SLV came all the way to the mid line
• Shorts still on with 2% stop in place
• Watch mid line to see if it hold around $40.00

GLD (Weekly) Bull Fork

GLD

• Would Turn Bearish If Mid Line Is Broken
• Close Below $148.50 Would Break The Mid Line
• A Top Could Be In Soon "IF THERE IS NO QE3"

Update On SLV

• Nice little short on sliver (Put In Stops To Lock In Gain)
• When there is a major break out of the fork, shorting for a day or 2 usually pays pretty well
• The United States Dollar had been falling which is bullish for the SLV, GLD, and USO
• Feel the Dollar is close to a bottom and over all market is near a top

SLV-Weekly

SLV

• Way To High Way To Fast! SHORTING!
• I Believe A Top Is In Or Will Be Soon
• Could Get One Last Jump If QE3 Happens
• Break Below 44 Would Turn Bearish