a message for aggressive contrarians

Here is my latest post on "The Art of Contrarian Trading".

Guesstimates on August 31, 2011

September S&P E-mini Futures: Today's day session range estimate is 1207-1227. I think the market is headed for 1220-1240. Once this target zone is reached the bear market is likely to resume.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

September Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 60. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: Gold is in the midst of a reaction within an ongoing bull market . Downside target is 1575. Resistance above the market is in the 1820-1840 zone.

SLV - September Silver: Support in silver is at 35.00. From there a move to 50.00 and higher should begin.

Google: I think much bigger drop than I expected is underway. Downside target is 375.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 30, 2011

September S&P E-mini Futures: Today's day session range estimate is 1187-1207. Support is at 1180 and I think the market is headed for 1220-1240. Once this target zone is reached the bear market is likely to resume.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

September Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: Gold is in the midst of a reaction within an ongoing bull market . Downside target is 1575. Resistance above the market is in the 1820-1840 zone.

SLV - September Silver: Support in silver is at 35.00. From there a move to 50.00 and higher should begin.

Google: I think much bigger drop than I expected is underway. Downside target is 375.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 29, 2011

September S&P E-mini Futures: Today's day session range estimate is 1177-1202. The market is headed for 1210 and then for 1220-1240. Once the latter target zone is reached the bear market is likely to resume.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

September Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: Gold is in the midst of a reaction within an ongoing bull market . Downside target is 1575. Resistance above the market is at 1820.

SLV - September Silver: Support in silver is at 35.00. From there a move to 50.00 and higher should begin.

Google: I think much bigger drop than I expected is underway. Downside target is 375.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 26, 2011

September S&P E-mini Futures: Today's day session range estimate is 1145-1170. I expect support at 1150 to hold but if it doesn't the ES will drop to 1100 before resuming its move into the 1220-1240 range.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

September Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: Gold never made it to the1960 target and now is in the midst of a reaction within an ongoing bull market . Downside target is 1575. Resistance above the market is at 1820.

SLV - September Silver: Support in silver is at 35.00. From there a move to 50.00 and higher should begin.

Google: I think much bigger drop than I expected is underway. Downside target is 375.

Apple: Upside target is 435. Support is at 345.

up - then down

Here is a five point box, one box reversal chart of the last two weeks of e-mini trading.

You can see that the ES built a substantial base in the 1115-1150 range last week and early this week. The count target (solid green lines) from this base point to 1240. However, I think this is a bear market and in bear markets upside count targets are often not fulfilled. The midpoint of the drop from the May top to the August low is 1222 and this is perhaps a more realistic target for this rally.

The upside breakout from this base reached a temporary high this morning at 1188.50 on the news that Warren Buffett has taken a substantial position in Bank of America. The drop from there has been fast, but support should develop in the vicinity of the breakout level (red dash line) which is at 1153.25.

Once the rally into the 1220-40 range is over I expect the ES to resume its bear market decline.

Guesstimates on August 25, 2011

September S&P E-mini Futures: Today's day session range estimate is 1169-1192. I think the ES is now headed into the 1220-1240 range.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

September Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: Gold never made it to the1960 target and now is in the midst of a reaction within an ongoing bull market . Downside target is 1575. Resistance above the marke is at 1820.

SLV - September Silver: Support in silver is at 35.00. From there a move to 50.00 and higher should begin.

Google: I think much bigger drop than I expected is underway. Downside target is 375.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 24, 2011

September S&P E-mini Futures: Today's day session range estimate is 1152-1182. I think the ES is now headed into the 1220-1240 range.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

September Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: Next stop is1960

SLV - September Silver: Silver moved above 43.00 so the next upside target is 50.00.

Google: Google has broken well below 530 support. I think much bigger drop than I expected is underway. Downside target is 375.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 23, 2011

September S&P E-mini Futures: Today's day session range estimate is 1127-1155. Strength above 1159 would mean that the ES is now headed above1206. Otherwise I will stick with my view that the ES first will drop to 1098-1103. From there a rally to 1220-30 is likely.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

September Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: Next stop is1960

SLV - September Silver: Silver moved above 43.00 so the next upside target is 50.00.

Google: Google has broken well below 530 support. I think much bigger drop than I expected is underway. Downside target is 375.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 22, 2011

September S&P E-mini Futures: Today's day session range estimate is 1126-1159. Strength above 1159 would mean that the ES is now headed above1206. Otherwise I will stick with my view that I think the ES first will drop to 1098-1103. From there a rally to 1220-30 is likely.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: Next stop is1960

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: Google has broken well below 530 support. I think much bigger drop than I expected is underway. Downside target is 375.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 19, 2011

September S&P E-mini Futures: Today's day session range estimate is 1109-1141. I think the ES is on its way to 1098-1103. From there a rally to 1220-30 is likely.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: The market has traded well above the 1810 level which I thought would be resistance. Next stop is1960

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: Google has broken well below 530 support. I think much bigger drop than I expected is underway. Downside target is 375.

Apple: Upside target is 435. Support is at 345.

Lindsay update

Here is a weekly chart of the S&P 500. I want to use it to illustrate the position of the market using some of the simpler and longer run considerations which make up George Lindsay's stock market timing method. By the way, if you are a Lindsay fan and have not yet purchased a copy of Ed Carlson's new book, do it now!

I had thought that the price action from February to July of 2011, encompassed by points 21-25 on the chart, was the top of the first story of the domed house within Lindsay's Three Peaks and a Domed House formation (the three peaks are points 3, 5, and 7). But instead the May 2, top, labeled as point 23, is now my best guess as the top of the dome and the end of the bull market. The implication of this interpretation is that the market is headed below point 10, the separating decline, which ended at the July 2010 low. This was the 1010 level in the S&P. My point and figure work which I explained last week suggests a downside target of 990 or so.

Lindsay's timing method let's us make an educated guess as to how long the market will take to complete this bear market.

The March 2000 top in the S&P 500 was a very important top. Lindsay generally expected an important low to develop about 12 years plus a few months after such a top. March 2012 is exactly 12 years from the year 2000 top which ended the dot com bubble (green arrow).

One reason for thinking that the May 2 top in 2011 was point 23 is that it was 787 calendar days after the March 6, 2009 bear market low. This qualifies the bull market as a long basic advance according to Lindsay. A long basic decline of 345 days from the May 2 top would end on April 12, 2012, about 12 years and 1 month from the top in March 2000.

There is another consideration which is worth noting. The drop from point 7 to point 10 in the chart above qualifies as a descending middle section in Lindsay's terminology (see chapter 13 of Carlson's book). I put point C of this middle section on the day of the Flash Crash, May 6, 2010. I put point E on June 4, 2010.

Lindsay's theory is that the time from one of points C or E to the subsequent bull market top on May 2, 2011 (point 23 on the chart) should equal the duration of the subsequent bear market. The count from point C gives a bear market duration of 361 days while the count from point E gives a duration of 332 days. The point C count predicts the end of the bear market for April 29, 2012 while the point E count predicts the end for March 31, 2012. Either of these time spans qualifies as a long basic decline according to Lindsay.

So my best guess right now is that the 2011-2012 bear market will end in April 2012.

Guesstimates on August 18, 2011

September S&P E-mini Futures: Today's day session range estimate is 1150-1175. I think the ES is on its way to 1130. From there a rally to 1220-30 is likely.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: The market has traded as high as 1821, a new high for the bull market. I still think gold is going to have a hard time moving much above 1810 before it drops to 1450 or so.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway. Support is at 530.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 17, 2011

September S&P E-mini Futures: Today's day session range estimate is 1190-1211. From 1211 I think the ES will break 50-75 points before resuming a rally to 1220-30.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped as low as 75. Resistance above the market is now at 92 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: The market has traded as high as 1817. I think the next development will be a drop to 1450. Resistance above the market is at 1810.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway. Support is at 530.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 16, 2011

September S&P E-mini Futures: Today's day session range estimate is 1174-1193. I now think the ES will drop to 1150 or so as the first stage of a bigger break to 1100 or so. After that break a move to 1210-1230 should develop.

QQQ: Support is 50.00 and upside target is now 58.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped as low as 75. Resistance above the market is at 87 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: The market has traded as high as 1817. I think the next development will be a drop to 1450. Resistance above the market is at 1810.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway. Support is at 530.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 15, 2011

September S&P E-mini Futures: Today's day session range estimate is 1178-1198. I think the ES will rally 1200, then again break to 1100 or so, then put in a multi-week rally to 1200-1250.

QQQ: Support is 50.00 and upside target is still 63.00.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped as low as 75. Resistance above the market is now at 87 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: The market has traded as high as 1817. I think the next development will be a drop to 1450. Resistance above the market is at 1810.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway. Support is at 530.

Apple: Upside target is 435. Support is at 345.

update

This week's price action ha dramatically changed the outlook for the S&P. The chart above is a 10 point box, one box reversal, point and figure chart showing this year's action in the cash S&P 500.

Contrary to my expectation the drop below 1240 was not quickly reversed. Instead the market dropped to 1110 (and to 1077 overnight in the futures) before stabilizing. The count across the top area projects a low around 1000 or a little lower. Recall that the July 2010 low in the S&P was 1010.

In the meantime another trading area has formed on this chart and projects a potential rally to 1240 or so. This would be a rally back to the lower edge of the top formation which is now strong resistance. The midpoint of the drop from 1370 to 1110 is 1240 also (red dash line which is drawn 20 points too low for visibility on the chart).

So I think the market is on its way to 1240 or perhaps a bit shy of that level. This rally should then be followed by a drop to 1000 or a little lower. If the market drops from 1240 by the amount of the first drop from 1370 to 1110 it would make its low near 980.

Guesstimates on August 12, 2011

September S&P E-mini Futures: Today's day session range estimate is 1164-1194. I think the ES will rally 1200, then again break to 1100 or so, then put in a multi-week rally to 1200-1250.

QQQ: Support is 50.00 and upside target is still 63.00.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped as low as 75. Resistance above the market is now at 87 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: The market has traded as high as 1817. I think the next development will be a drop to 1450. Resistance above the market is at 1810.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway. Support is at 530.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 11, 2011

September S&P E-mini Futures: Today's day session range estimate is 1118-1161. I think the ES will rally to 1180-1200, then again break to 1100 or so, then put in a multi-week rally to 1200-1250.

QQQ: Support is 50.00 and upside target is still 63.00.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is near its historical low but will soon start a move to 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped as low as 75. Resistance above the market is at 83 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: The market has traded as high as 1777, $27 above the 1750 target. I think the next development will be a drop to 1450. Resistance above the market is at 1810.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway. Support is at 530.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 10, 2011

September S&P E-mini Futures: Today's day session range estimate is 1132-1170. I think the ES will rally to 1180-1200, then break to 1100 or so, then put in a multi-week rally to 1200-1250.

QQQ: Support is 50.00 and upside target is still 63.00.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is headed for 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped as low as 75. Resistance above the market is at 83 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 range.

GLD – December Gold: The market has traded as high as 1777, $27 above our 1750 target. I think the next development will be a drop to 1450. Resistance above the market is at 1810.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway. Support is at 530.

Apple: Upside target is 435. Support is at 345.

Panic II

Here is my latest post on "The Art of Contrarian Trading".

Guesstimates on August 9, 2011

September S&P E-mini Futures: Today's day session range estimate is 1112-1162. I think the ES will rally to 1180-1200, then break to 1050 or so, then put in a multi-week rally to 1200-1250.

QQQ: Support is 50.00 and upside target is still 63.00.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is headed for 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: Crude has dropped close to 75 last night. Resistance above the market is at 83 and the next step down should take it to 70. I think this is a bear market in crude which is likely to continue down into the 50-60 rnage..

GLD – December Gold: The market traded $27 above our 1750 target last night but we think the next development will be a drop to 1450. Resistance above the market is at 1810.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway. Support is at 530.

Apple: Upside target is 435. Support is at 345.

Guesstimates on August 8, 2011

September S&P E-mini Futures: Today's day session range estimate is 1160-1197. Last week's high volume collapse was climactic and the next development will be a rally to 1250-1260. The 200 day moving average is still headed upward so I still think this 15 % drop in the cash S&P is a correction within an ongoing bull market.

QQQ: Upside target is 63.00.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is headed for 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support remains at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: The market took out its last low at 90 so I think it is now headed for 80-81. My best guess is that a bear market in crude is now underway.

GLD – December Gold: Next stop is 1750. Support is at 1570.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway.

Apple: Upside target is now 415.

S&P downgrades USA

After Friday's close the credit raters at the S&P downgraded their ratings of US government debt securities from AAA to AA+.

I think the S&P rating folks are imbeciles and don't deserve to be taken seriously by adults. Why?

1. Their understanding of real estate economics led them to rate the vast majority of mortgage backed securities AAA back in 2005-07. This alone should be sufficient to destroy their credibility among thinking people.

2. Their downgrade of the US is based purely on predictions of what the politicians will or won't do. I find it hard to believe their political forecasts are better than their real estate forecasts.

3. As I have often pointed out it is impossible for the US to default on debt servicing and repayments. We borrow in our own currency which we can print at will.

4. RE 3. - If the world was worrying about US failure to repay why have treasury securities been rallying the past week as investors flee to quality?

Panic

Here is my latest post on "The Art of Contrarian Trading".

Guesstimates on August 5, 2011

September S&P E-mini Futures: Today's day session range estimate is 1200-1225. Yesterday's high volume collapse was climactic and the next development will be a rally to 1250-1260. The 200 day moving average is still headed upward so I still think this 12 % drop in the cash S&P is a correction within an ongoing bull market.

QQQ: Upside target is 63.00.

TYX (thirty year bond yield): The 30 year bond yield is on its way to 5.40%.

TNX (ten year note yield): The 10 year yield is headed for 4.50%.

Euro-US Dollar: I think this market is now headed for 1.5300. Support is at 142.00.

Dollar-Yen: The market is headed down to 70.00. Resistance above the market is at 80.00.

August Crude: The market took out its last low at 90 yesterday so I think it is now headed for 80-81. My best guess is that a bear market in crude is now underway.

GLD – December Gold: Next stop is 1750. Support is at 1570.

SLV - September Silver: Resistance is at 41.00. Any strength above 43.00 would mean that the move will continue above 50.00.

Google: I think a move to 750 and above is underway.

Apple: Upside target is now 415.