Whats going up in DOW, Nasdaq, and S&P500 will come down soon...!!

The market manipulation is at full swing

The day started with weak economic data from US, Canada and Europe. France GDP came out 0.3% while expectation was 0.4%, Canada GDP came at 0% previous was 0.2% and yesterday US GDP came at 1.8% while expectation was 2% and Italian GDP came at -0.2%.  In last 4 trading day, Dow has added 560 point, S&P500 added 65 points, while Nasdaq added 100 points. Today was the weakest low volume day trading in Dow for 2011 with just 80 million share traded and it rallied up 124 point. http://www.google.com/finance/historical?q=INDEXDJX:.DJI

Another very important weak data for today was Personal income, it came 0.1% while expectation was 0.4%, while consumer spending came at 0.1% while expectation was 0.3%. In Dec 2010, consumer spending was 0.7%. 

Personal income from 2008 - 2011

The data shows people are not earning enough but they are spending everything they are earning. 

New home sales came out 1.6%, while expectation was 2.6%, which was cherished, but you might be surprise to know that 2011 is the worst year of New home sales since 1963. 

Looking at all the data which are coming out from US, and Europe clearly shows a sign of recession and heading for double dip recession. 

How can one think of being bullish in this stock market with such bad economy report ? Look at the chart and it tells the true story of US economy. Compare any US economic data of last 10 year and it will show that 2011 is worst year after 2008-2009. Even after 3 year, the growth is stalled.

Some of the trader have a glimmer of hope that in next FOMC  meeting on Jan 3rd, Fed might announce QE3 but again they might be disappointed again.

Whats going up in DOW, Nasdaq, and S&P500 will come down soon...!!

The correct level for DOW, S&P500 and Nasdaq with this kind of economy data should be 10099, 1066, and 2141 respectively.