Huge bull flag on SDS

Huge bull flag is forming on the SDS. We will have a massive move upwards if we breakout out of this massive triangle. Keep a close eye on this.
SDS is ultrashort S&P 500. DDM is ultrashort Dow Jones. No positions-waiting and watching further action tomorrow.

Oil and S&P 500 charts

We had a last 60 min huge engulfing candle on Friday. Now the signs are more clearer. If we break 900- play the long side. If we break 870, we head to test the 840-860 band. Not sure if we will break the 840 band. Things will become very clear by Tuesday afternoon.

Oil is still a falling knife that doesn't see any chance of a rebound. Till then, stay away or short oil.

Here is a weekly chart of oil.

Japan enters first recession since 2001

Nov. 17 (Bloomberg) -- Japan's economy, the world's second largest, unexpectedly shrank in the third quarter, confirming it entered the first recession since 2001 as companies cut spending.

Gross domestic product fell an annualized 0.4 percent in the three months ended Sept. 30, the Cabinet Office said today in Tokyo. Economists predicted the economy would grow 0.1 percent after contracting a revised 3.7 percent in the previous period.

Hong Kong also enters into recession

HONG KONG (AFP) — Hong Kong slipped into recession in the third quarter as the global economic slowdown took its toll on the financial hub, government figures showed Friday.

Hong Kong's gross domestic product fell 0.5 percent from the previous quarter on a seasonally adjusted basis, following a fall of 1.4 percent in the second quarter, the Census and Statistics Department said in a statement.

"The growth of the Hong Kong economy slowed notably further in the third quarter, as the external sector slackened amid the faltering global demand," government economist Helen Chan said in the statement.

"And as domestic demand towards the end of the quarter was severely hit by the outbreak of the global financial tsunami that caused significant jitters in the local asset markets."

The standard definition for recession is two consecutive quarters of falling GDP.

Hong Kong joins Singapore, Germany, New Zealand and Italy in reporting a technical recession as the global slowdown bites into economies across the world.

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Source:AFP

Eurozone enters into first ever recession

The eurozone has fallen into recession for the first time since the single currency was introduced in 1999, official figures show this morning.

Eurostat, the European Union statistics agency, said third quarter GDP across the 15-nation eurozone shrank 0.2 per cent, following a 0.2 per cent fall in the previous quarter. A recession is defined as two quarters of negative growth.

Yesterday, Germany, Europe's largest country, fell into recession for the first time in four years but it emerged today that GDP in France is still growing, up 0.14%. However, Spain admitted today that growth shrank by 0.2 per cent.

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Source:Timesonline

Best Buy CEO statement-earnings

Statement from Best Buy CEO Brad Anderson:
"Since mid-September, rapid, seismic changes in consumer behavior have created the most difficult climate we've ever seen,
Best Buy simply can't adjust fast enough to maintain our earnings momentum for this year."

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We are beginning to see signs of consumer-led recession. Watch out ...this credit mess won't look that bad after that starts.

Intel earnings forecast shocks Wall Street

* Intel cuts Q4 rev forecast by 14 pct

* Says demand is weak in all market segments, geographies

* Applied Materials, National Semi also give weak outlooks

* Intel shares drop to 12-yr low, drags on tech stocks

Intel, the biggest maker of chips for personal computers, forecast fourth-quarter revenue of $9 billion, plus or minus $300 million. That compares to its October forecast of $10.1 billion to $10.9 billion, and the average analyst estimate of $10.3 billion according to Reuters Estimates.

"For revenue to be that far down sequentially, it means consumers have basically shut down for the holidays," said Charter Equity Research analyst John Dryden. Intel's third-quarter revenue was $10.2 billion.

Source: Reuters

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And now INTC is heading to 2002 lows.

And the market will follow to the 2002 lows. Sooner than later. We STILL DON"T have a capitulation to mark a bottom. Till then no need to buy any stocks.

S&P 500 60-min chart

Looks almost certain that we are headed to the lows. All indicators are providing support for further lows.

China with a 4 trillion Yuan stimulus package

BEIJING – China's massive stimulus package will help contribute to global stability by boosting investment in the world's fourth-largest economy and consumer spending, the nation's top economic official said Monday.

Faced with the prospect of zero export growth, closing factories and mass layoffs, China joined moves by governments around the world to cushion the blow of the global slowdown with the announcement of the $586 billion package.

The plan calls for higher spending on roads, airports and other infrastructure, tax deductions for exporters and more aid to the poor and farmers. Spending on health and education will increase, as well as on environmental protection and high technology.

"We must implement the measures to ensure a fast and stable economic development," Premier Wen Jiabao said at a meeting of government leaders, according to a report read out on the state television. "They are not only the needs of the development of ourselves, but also our biggest contribution to the world."

The government's stimulus announcement appears to exaggerate the size of its plan by including projects already under way, including reconstruction from the devastating May earthquake in China's southwest, said Sherman Chan, an economist for Moody's Economy.com.

"The exaggeration highlights the government's desperation to revive sentiment, which is perhaps the key factor to sustaining growth amid global turmoil," Chan said in a report.

Source: Yahoo news

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Questions that remain and will be answered in a few weeks:

Will this revive the commodities again as it is focussed on infrastructure buildout ?
They are planning to spend $14 billion before the end of this year. Will this help kick start the markets for a Santa Rally?
Will this massive spending help the world economy esp US ?