Something strange is going on.

We have folks claiming the major indexes can go to the moon. We have different logic sets in play behind each one but all of it is flawed.

Claims that the top in the DOW is 14,000. Claims that the Nasdaq is not out of gas. The better rational explanation is the DOW was in trouble at about 10,700. Nasdaq can't get past 2400. Tech is toast, the claim is Bio is driving the Nasdaq. Claim that the overseas activity is what is important in the DOW, America no longer matters.

The big thing Wall Street can't mirror what is happening on Main Street. The national pix is widely different than at the state or local level. The big question is the noise out of Washington enough to correct the underlying gross flaws, I doubt it, like a super tanker at sea, takes a long time to answer to the rudder in changing course.

The thing peaking my interest the most now is the relationship between the various ETF's long & short that supposely track and mirror the indexes. In particular the QID.

One simple fact must be true. Going up the long ETF can track and mirror their respective indexes forever. Going up is also a more static type event, the reset feature of the mirroring ETF has a better chance to stay in sync.

Also another point, I've never seen this discussed in any degree. The long ETF is sort of a counter balance to the short ETF's in their effect on the index themselves, I guess in a perfect World, they cancel.

But the same is not true of the short ETF in how they mirror their indexes. The indexes value can increase forever but the short ETF value can only go to zero value. At some point the proportional aspect has to drop out. They warn in sort of cryptic terms about this but what does it all mean. At some point if you graph it, they must diverge. With the QID in the $16 - 17 range that is now true. Saying it simple the risk starts to drop out of the QID in a non-proportional manner. The ETF's especially in low volume situations like we have now sort of take on a mind of their own and become driving factors of the index, not just attempting to mirror them.

The other puzzling thing about how these relationships might work is the down side always happens quicker. There should be a rip effect as on the indexes because of that. The indexes no longer are affected by just the market and its stocks as before.

Can't quite put my finger on it or maybe express how I suspect it will work. A percentage move down may be self amplifying beyond what could be expected.

The main point is I think a major correction is near. I used to think after the elections, then it was no maybe in July. Now I fear it is coming in April.

Telling me to get out of major long positions, least cut them way back if possible. Average into QID's, maybe try to trade in - out temporary in the under $17 range. Have cash available to buy into the QID big if any type of move starts down.

The facts about the economy are saying the same thing. Any job growth too little too late, housing is a dead horse for a number of years, the commerical real estate disaster will hit hard this summer, it is underwater like housing, the owners will throw in the keys and walk away, banks are probably not protected, more banking dominoes, etc. etc.

What does it all mean Alfie??? I think it is a strange way of signaling a top in indexes. Those seeing lower risk and buying the short side have a corresponding influence on the index and making it difficult to move without increasing fire power out of proportion on the long side. The fundamental facts can not support indexes that are some estimations already over priced.

What did I miss, where is the convincing argument the markets can move higher in any case this year??? There is also that strange oscillation type movement in the QID on the way down. Just lil recovery hump attempts, always less than the prior level, then at the bottom a far bigger wave and nothing that looks like a continuation under $20 price. Puzzle is the charting software sees nothing it will call a turn in progress, or even a slide sideways. Very strange stuff. Is a big correction coming or not, if so when?