Today American Express revealed that they had underestimated the rate of credit card delinquencies. I suspect this will be the next shoe to drop as embattled consumers start to default on their credit card payments.From the look of the AXP chart I'd say it has already started. A break below the $40 support would not be good for the consumer outlook. I think it's safe to say that Discover is having trouble with defaults and delinquencies also.
Folks I think we have tough times ahead. I also think the current four year cycle has already topped out. If the market manages to trade below the Jan & Mar. lows before this 22 week cycle bottoms then we can add in not only a failed seasonal cycle but one that is left translated. The average decline for a failed seasonal cycle is -30+%.
This is not a pretty picture brewing here
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