the big bad wolf, the big bad wolf, the big bad wolf? the big bad fed…  Who’s afraid of Janet, Janet Y.,  Janet…?

http://stockcharts.com/h-sc/ui?s=%24SPX&p=W&yr=2&mn=0&dy=0&id=p44892117966&a=432305978

So stop the Chinese water torture already and raise the rates.  The game has gotten boring.

Here’s what we think about market prospects with a rate rise:  meh.  Translated from the Tibetan this means that unless the Fed does something dramatic (read, stupid) the teapot tempest will be forgotten in hours.

At the same time potential for market moving events lurks in the system.  Traders, seeing what looks like a lead pipe cinch are crowding into eurodollar futures.  Anytime you have an overcrowded market you have the possibility of damage — someone yells fire and the weak get trampled.  By all obvious logic short bonds should be a winner also.  Withal we think these  are potentially dangerous times.  If we do anything it will be short the TLT.

Prices are still in the box but it appears that the downwave  is over.

http://stockcharts.com/h-sc/ui?s=%24SPX&p=D&yr=0&mn=6&dy=0&id=p38955316076&a=266398464

http://stockcharts.com/h-sc/ui?s=%24SPX&p=D&yr=0&mn=6&dy=0&id=p38955316076&a=266398464