Two weeks ago, I alerted readers to what I thought would be the deal-killer for the Rangers who have been hyping this market for the GOP. Last week, I repeated the warning. With the Dow at 11,850 last Friday, I wrote:

"I'm going to tell traders that they may have to grin and bear it, but hang in with equities, including their commodity-producers, until the broad market decides it's time to swoon; That time, though, is getting closer " perhaps the week of October 16 when there are heavy duty reports out on the 17th and 18th that will focus traders on Stagflation " at a time the 3Q06 Earnings Season is in full bloom. Calendar for Oct. 17-18.

So Tuesday is the day, according to my crystal ball. Tomorrow, we may get a taste with the GE results. But then, Jeff Immelt (GE Chairman, and CNBC bossman) is also on the Federal Reserve Bank of New York board of directors. He may have been told to stick to the party line.

Nonetheless, we are just days away from a world of pain. And I'm not just talking FBI here.

Except for May 10 " you remember May 10? " the Daily RSI-7 of the DJIA closed today at a high of over 82. The Monthly is now even higher, and the Weekly almost as bad.

The M-W-D RSI-7 values are: 82.3-76.0-82.2. Mathematically, it's impossible to go much higher even if the casino is rigged.

At such extreme values for the Dow 30, particularly late in the four-year stock cycle, I have never seen a put buyer lose with RSI values so high. Repeat: Never lose!

But if you are going to play the Bear side, don't go shorter than three months because this market is in a melt-up that may continue beyond my forecasted peak, and then will possibly take some time to work its way south.

Time decay is always the bane of put and call buyers, which is why I don't often recommend them, and when I do, I suggest taking a long-term position.

The other concern is that there may be a bias by certain political types (that's kind enough, right?) to use a rising equity market scenario as a picture of prosperity in America. Just to make a point that this is not about politics, these people may decide to carry the enthusiasm through to January.

January works for Wall Street, as you know " year-end bonuses and all.

In any event, take a look at the DJIA MACD since mid-July. That flat line is why I say that these 30 stocks are under control. For now.

International equity markets are also robust, so all of this just might be a figment of my imagination. Do you think?

Or, do you think that maybe Wall Street is no longer a square mile in Manhattan, but a highway network that has spread its arteries around the globe?

Money talks you know.

And, Talking Heads are now saying that "profits are booming" and that "capital pricing models are 35-pct higher than index levels today." I seem to recall the same storyline during 4Q99.

I'll stick to watching the RSI on the four major U.S. equity market indexes, and the $USD, thank you. As long as that RSI-7 is rising for all three of the Monthly, Weekly and Daily, and the RSI-7 is above the RSI-14, then all is well.

Then again, I haven't seen it so well for a while. 4Q99, actually.

To conclude: Let's see how the Rangers try to spin next Tuesday-Wednesday's economic data.

Condolences

I am a little out of sorts this afternoon and evening. After returning from a meeting today, I received the news that Butch Kerzner (41) has been killed in a helicopter crash. Butch is the son of Sol Kerzner, founder and Chairman of Kerzner International, which owns half of Paradise Island in the Bahamas, including the Atlantis Resort and the One & Only Ocean Club. Butch has been CEO for several years.

By a strange quirk of fate, I called his office at 8:15am this morning, not knowing of this terrible situation. I was calling his Senior Vice President to see how Butch had been thinking of a proposal I made a couple weeks ago. The initial indications from staff were positive, and I was hoping to get some confirmation.

You know, people ask how things are going in Bahamas. I'm afraid to say.

In June, I was ready to depart to Freeport, about 120 miles north of Nassau-Paradise Island, when the spokesperson for the two owners called me late in the evening to advise me there was going to be an upheaval the next day that would put my development agreement on hold. Subsequently the three senior executives of the Grand Bahama Port Authority had been dismissed and three other directors resigned. That's when I switched to a Nassau-PI proposal.

As one of those former GBPA directors told me tonight after hearing of the Kerzner situation, "Yep, that is enough to make you visit the Marie Laveau potion shop."

You see he's from New Orleans, and he knows that voodoo is stronger than my crystal ball.

Some days, I feel I can't win for losing.

That's an expression that was around when I was a kid. It doesn't apply to the market.

Or, does it?