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Manipulated Market: A Tale Of The Federal Reserve



February 07, 2012 – Comments (0) | RELATED TICKERS: SPY , DIA , UUP

Sometimes it is scary to see manipulation in full swing in the stock market. Actually, it is always scary to think such blatant manipulation can occur and by the leading powers in the "free" world. Let's set the stage. The markets opened slightly lower. No big deal here. They slowly inched lower on light volume, heading for the master support of $133.80 on the SPDR S&P 500 ETF (NYSEARCA:SPY). This level was the gap window from Friday and had also touched yesterday. Simply put, it is key support.

As the markets traded towards that level, any intelligent trader knows this is the level that will either be held or broken. A break means further downside and a possible market correction. Intra day, the SPY trades to the level around 10am ET. This is where things get fishy in multiple ways.

At this moment in time, three factors come together to save the day. During the last sixty seconds of the ten minute candle, someone or something pushes the market back above the gap window support of $133.80, At the very same time, Bernanke steps to the podium to give a speech and finally, the Dollar starts to collapse. The Dollar dropping always pushes the markets higher as the two trade inversely to each other.

The shady nature of this event is clearly seen as it all happened at the split second Bernanke began his speech and which coincided with the last minute saving of the market above a major technical level. The retail investor is at work and will only see the closing prints on this market. However, true traders know the real deal in the market when light volume allows for manipulation. Thank you Federal Reserve for continuing to allow market bubbles.

Gareth Soloway

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