Monday, March 16, 2009

Some chartists calculate ABCD patterns in the way shown, but I have found the targets of such patterns to be less reliable, ad therefore less useful, than the ones we use. Even so, as a way of predicting how far this bear rally might go, the 'D' in the chart,

My minimum upside target for the near term is still 771.75, or 778.00 if any higher. (For the June contract, the equivalent numbers are 769.00 and 774.25.) The futures would need to do a little better, however, touching

On the hourly chart, Gold's impulsive declines continue to show more power than the rallies. For instance, although last Tuesday's low exceeded a key bottom at 891.90 recorded a month earlier, the rally since has so far failed to answer the thrust with a correspondingly strong upthrust. That would have required a push touch

As of 3:20 a.m. I've posted four touts for Monday, including a DJIA chart that uses a novel approach to predict a possible high for this bear rally.  Action Sunday night was extremely subdued, hinting that DaBoyz will be looking to go with the flow -- i.e., meander higher -- as the new week begins.

Joining a national trend, local governments here in fiscally conservative Colorado have taken a meat axe to their budgets in order to bring spending in line with plummeting sales tax revenues. Broomfield, for one, has just cut outlays by $12.2 million, or five percent, postponing dozens of construction projects and instituting a hiring freeze.  Boulder has sliced $3.6 million from this year's budget and is preparing to trim millions more, since the local business picture is continuing to deteriorate rapidly. (Every resident knows it, too, because of the relentless shuttering of big stores in the relatively new Twenty-Ninth Street mall.)  Lafayette is in somewhat better shape, having initiated layoffs at the beginning of 2009 in anticipation of a drop of at least 10 percent in sales taxes revenue. Meanwhile, my hometown of Superior is preparing a contingency budget, having determined that a 3.7% increase in sales taxes revenues estimated not long ago was far too optimistic. Across the U.S., local governments have been retrenching in the face of the most severe economic downturn since the 1930s. But suppose cities had followed the lead of the U.S. Government, revving up outlays and socking homeowners with significantly higher property and local taxes, even as they justified such reckless policies with absurdly optimistic recovery projections for 2010 and beyond?  Homeowners would be rioting in the streets -- and with good reason, since, unlike the Federal Government, states and municipalities have wisely been prohibited from deficit spending.  When their budgets go into the red, taxpayers feel the pain immediately, resulting in higher levies just as soon as they can be enacted. Just ask someone who lives in Californian, which in its desperation to paper over a giant deficit, has implemented punitive new taxes on workers, employers and motorists. The Death of Affluence Does any taxpayer