The past week contained the final trading days for the first quarter of 2013. There are always cross currents associated with the end of the month and particularly the end of the quarter. This demonstrated that when the S&Ps had their low Tuesday, in overnight, lost their legs. We did not have any plus 1000 ticks yesterday denoting lack of institutional participation. The disparities continue to abound. The bonds are up nearly a full point Wednesday and the S&P was unchanged. This can only happen with manipulation. The early morning saw what happens when the computers are not turned on as we dipped below 1550. Then the rescue squad came and pushed price above 1550 and the slow methodical computer generated mode they used. Watching how these computers use their algorithm makes me chuckle as it is definitely younger traders. They do not know the dangers of a market with no volatility.
The Federal Reserve writes the stock market script now and is very blatant about it. They tried once again on the last day of the month to close the S&Ps at an all time high, meaning a close above 1565.15. We have seen this first quarter as a stomping ground for Fed intervention in the stock market even though they state they only buy bonds. I do not like to participate in the market the last trading day of the quarter. I would suggest watching instead of participating as the script may already be written. The bonds seemed unaffected by the news this past Thursday. The bond auction had some affect and it has been holding to the upside going into the holiday weekend.
I believe when the 1st quarter of 2013 is looked upon in a rear view mirror, it will go down as one of the most overextended, overbought markets of all time. Keep in mind that the complacency factors that I view have the bulls not seeing the semi bearing down on them to flatten. A pullback of 200 to 300 S&P points from this point to sometime in 2013 appears likely given the overextension. I feel like the person that knows the earthquake is going to consume all the terrain, but nobody is listening as they sip marguerites and purchase extravagances beyond normal common sense. Human nature will never change.