China’s stocks could fall 50% from here if Obama’s announced “Great Depression” spreads to China.

Obama boasted that since he took office U.S. dependence on foreign oil is below 50 percent for the first time in 13 years. “To be sure that is not because the White House meant for that to happen,” said Pavel Molchanov, an analyst at Raymond James & Associates Inc. Obama has done everything he could to cripple American energy in order to sell Solyndra solar panels and electric cars that cost more energy to build than they save. And what is worse, the batteries that go with the Obama green systems are more toxic than if the homeowners burned green wood to heat their homes. Many have $60,000 subsidized solar systems in northern America where they are covered with snow and don’t work.

Obama corruption lead has peaked and is starting to slip. The lobbying corruption gave Obama a $1billion target for campaign spending. It does not look like he will make it.

World markets
The IMF chopped its estimate for 2012 global growth too and warned it could drop as low as 1.3 percent if Europe lets the crisis fester for much longer. IMF chief economist Olivier Blanchard said at a news conference. "There is an even greater danger, namely that the European crisis intensifies, and in this case the world could be plunged into another recession."

Japan reported to a trade deficit and a slowing economy.

Dry goods trade has plummeted indicating China and India are in for a slow down unless they can stimulate internal consumption.

The World Bank cut its forecast for global growth including China, by the most in three years to 2.5%

We expect the markets will all form head-and-shoulder sell signals after breaking their 200 DMA. World trade “Bulk Shipments” have collapsed to the lowest world bulk trade level that existed since Obama declared the USA was in a depression in one of his 2007-2008 campaign speeches. Asian markets (especially China) are failing to break out some on the second and third times at resistance levels. China’s stocks could fall 50% from here if Obama’s announced “Great Depression” spreads there too.
http://finance.yahoo.com/q/ta?s=000001.SS&t=2y&l=on&z=l&q=l&p=e200%2Ce100&a=&c=

Germany broke through the resistance levels: Choose 2 or 5 years
http://finance.yahoo.com/echarts?s=%5EGDAXI+Interactive#chart2:symbol=^gdaxi;range=2y;indicator=ema(200,100)+volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on

The Swiss broke through the resistance levels. Choose 2 or 5 years http://finance.yahoo.com/echarts?s=%5ESSMI+Interactive#chart1:symbol=^ssmi;range=2y;indicator=ema(200,100)+volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

Emerging markets show strength. Brazil broke through
http://finance.yahoo.com/echarts?s=^BVSP+Interactive#chart1:symbol=^bvsp;range=2y;indicator=ema(100,200)+volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

American Economy
Yesterday
MBA Mortgage Index 01/21 -5.0% down from 23.1% terrible
Pending Home Sales Dec -3.5% down from 7.3% end of season
FHFA Housing Price Index Nov +1.0% up from -0.2% good
Crude Inventories 01/21 +3.56M up from -3.438M good
FOMC Rate Decision Jan 0-0.25% down from 0.25% getting dangerously like Japan

Today
Jan 26 8:30 AM Initial Claims 01/21 - 375K 375K 352K -
Jan 26 8:30 AM Continuing Claims 01/14 - 3550K 3550K 3432K -
Jan 26 8:30 AM Durable Orders Dec - 3.0% 2.0% 3.7% 3.8%
Jan 26 8:30 AM Durable Orders -ex Auto Dec - 1.0% 0.7% 0.3% -
Jan 26 10:00 AM New Home Sales Dec - 310K 322K 315K -
Jan 26 10:00 AM Leading Indicators Dec - 0.7% 0.7% 0.5% -

This Week
Jan 27 8:30 AM Chain Deflator-Adv. Q4 - NA NA 2.6% -
Jan 27 8:30 AM GDP-Adv. Q4 - 3.2% 3.1% 1.8% -
Jan 27 8:30 AM Chain Deflator-Adv. Q4 - 0.7% 1.5% 2.6% -
Jan 27 9:55 AM Michigan Sentiment - Final Jan

Market outlook January 26, 2012
Housing stock prices are set to plummet again has sales plummet again. Without quantitative easing a sudden drop in all stock prices becomes more probable. The DOW is considered a safe haven so it has passed last year’s high. The other markets are still about 6% below their highs of last year.

As expected that the FED provided criteria for when to increase rates and conversely for when to initiate a third round of quantitative easing. The period of FED uncertainty now stretches to 2014 meaning that Obama gets an F grade for his administration ability to end the “Obama Depression.” He jawboned the depression and got it.

Since Obama announced his creation of a George Bush depression when there was just a looming Socialist-Democrat liar loan crisis, Americans have been selling stocks and buying American Treasury bonds thinking that Americans will never have to take a 60% hair cut. So there has bee a great outflow of cash in sudden stock sell-offs followed by a trickle in of Bernanke Quantitative easing. The Obama administration talks the free enterprise talk but unfortunately still walks the Bolshevik walk. Americans will have to put up with at least one more year of the Obama Depression and the growth of the Obama Welfare State.

The VIX indicates extreme complacency now. A sharp computer sell-off could end the current rally any time now and trigger stop-losses with huge losses.
http://finance.yahoo.com/q/bc?s=%5EVIX&t=2y&l=on&z=m&q=l&c=

Bulk shipments have collapsed to the lowest world bulk trade level that existed since Obama declared the USA was in a depression in one of his 2007-2008 campaign speeches. It is now less than 7% of the international trade that existed just before Obama was elected.
http://www.bloomberg.com/apps/quote?ticker=BDIY:IND

Stock market update:
Asian Stock markets were mostly closed for New Years again last night. China closed, Hong Kong up 1.6%, India closed, and Japan down –0.4%

European markets are up today in a range +0.3% to +1.4% with Italy and Belgium high outliers half way through their day.

American market futures are up about 0.2% in after hour trading at 7 AM EST.

We estimate the peak soon in a head-and-shoulders sell signal.