Thursday and Friday I was looking for the volume shelf at 1647 to get tested and, unless the market made a further downward extension, a reversal up to 1670. Neither happened.
The S&P got to 1648.60, then reversed and got to 1667.47. Sure it would be great to forecast and catch every tick, but it's impossible. I still had a great week, with Thursday and Friday being the best days to boot.
There is another large shelf at 1658. The wave pattern is open to interpretation, but a small correction will have me looking for buys as long as 1648.60 holds. Price will likely test higher into the 1665.93-1672.08 Fib zone.
Closing above the Fib zone opens up the 1758 1:1 Fibonacci extension target from the October 2011 lows.
But not so fast. There are a few things to note.
Last night, the yen reacted violently as Japan’s Economy Minister Akira Amari said further losses in the currency would have negative effects. The yen strengthened the most in three weeks against the dollar after it fell to the lowest since 2008 last week.
It wasn't just dollar-related, either. The yen rose versus all except one of its 16 major peers after Amari said yesterday there’s speculation the currency’s past strength has “been corrected a lot.”
This is an odd comment in light of Abenomics, and suggests a growing tension there, as well as a possible weakening of political will. It may also be a reflection that the Japanese citizens are not participating in the JGB market as much, which could have dire consequences.
The Nikkei continued its rise along with much of Asia except for India and South Korea. Europe, however, is mixed. I'm not surprised. Early on in the Euro Zone crisis, I was sure the problems would quickly shine a light onto French banks. I was wrong.
Today, a Zero Hedge contributor weighs in with The Most Dangerous Country In Europe. The article highlights the worsening economic and political situation in France and notes their banking system is an incredible 400% of GDP (the US is roughly 100%). Any slowdown there could prove catastrophic.
But nothing could be more catastrophic than winning a Billboard Music Award and getting booed for it. This just happened to Justin Bieber.
Why is this important? Because Bieber is the pop culture poster boy for the rally from 2009. His first single was released in July of 2009 as the markets were in recovery mode.
From Wikipedia (with emphasis added):
"Baby", the lead single from his debut album, My World 2.0, which features Ludacris, was released in January 2010 and became an international hit. It charted at number five on the U.S. Billboard Hot 100 and reached the top ten in several international markets.
Also, Bieber was a presenter at the 52nd Grammy Awards in January of 2010.
In July 2010, it was reported that Bieber was the most searched for celebrity on the Internet. That same month his music video, "Baby", surpassed Lady Gaga's "Bad Romance" to become the most viewed, and most disliked YouTube video ever.
In June 2011, Bieber was ranked #2 on the Forbes list of Best-Paid Celebrities under 30. He is the youngest star, and 1 of 7 musicians on the list, having raked in $53 million in a 12 month period.
His third studio album, Believe was released on June 19, 2012, by Island Records. The album marks a musical departure from the teen pop sound of his previous releases, and incorporates elements of dance-pop and R&B genres.
On March 7, 2013, Bieber fainted backstage at London's O2 Arena after complaining of breathing problems throughout his performance and was taken to the hospital. Bieber cancelled his second Lisbon, Portugal concert at the Pavilhão Atlântico, which was to be held on March 12, due to low ticket sales.
From a socionomic sense, this sounds somewhat like an aging and conflicted market, much like the rally since the 2009 lows. A rally people love to hate (including me). The strongest rally ever in point terms, yet built on dismal volume and weak internals. Kind of like having the most viewed, and most disliked, YouTube video ever.
That Justin Bieber was just booed for winning a musical achievement award after all his success should probably be considered for its socionomic implications. If social mood is turning away from one of its biggest beneficiaries since 2009, it's quite possible it can turn against the market just as fast.