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To catch up on four/five days of no Bloomberg, I spent lots of time at Bloomberg today. Now I’m convinced the market is going to fall. The evidence is in the options activity and the charts that I have posted. Of course, it should be said that the evidence displayed before you are biased. I do not post weak evidence or bullish-looking-screenshots because I have already taken those into account. I am convinced the market will fall because the overall picture is bearish.

Looking at the S&P500 chart, we can see it’s near resistance. Also notice the declining volume. This signals that the trend is losing momentum.

Looking at major index ETFs (i.e., SPY, QQQQ, IWM), I see large put activity.

Looking at some active SPY May options contracts Trade Summaries for today, I see large put positions being taken indicating SPY may head as far down as 128 by the end of May expirations.

I will reiterate. US Market’s will fall! =) .. Here’s Alan Greenspan’s commentary on the economy (I coloured the parts I think are important):

Greenspan Says U.S. Home Prices May Stabilize Later This Year
2008-04-07 22:32 (New York)

By Scott Lanman and Lily Nonomiya
April 8 (Bloomberg) — Former Federal Reserve Chairman Alan
Greenspan said the drop in U.S. home prices will probably end
“well before” early next year as the number of houses on the
market diminishes, aiding an economic rebound.
“It will not be until early 2009 that we will get close to
having eliminated most of this” home inventory, Greenspan told
a conference in Tokyo today sponsored by Deutsche Bank AG and
co-hosted by Bloomberg LP. “But it is very likely that home
prices will stabilize well before that.”
The health of the U.S. housing market is tied to broader
financial markets that rely on bundling mortgages to sell as
securities, Greenspan said. His successor, Fed Chairman Ben S.
Bernanke, and other Fed officials have highlighted declining
home prices as a major economic risk that may further hurt
household wealth and consumer spending.
“Once the markets start to stabilize, especially if the
real economies don’t go into a severe recession,” then “we can
expect a recovery to begin to take place,” Greenspan, 82, said
via satellite from Washington. “It will be slow, it will be
hesitant.”
He said the extent of damage stemming from the collapse of
the subprime-mortgage market won’t be known for months.
“Have we reached a point where prices are stable? We
cannot know that for a couple of months,” Greenspan said. “It
looks as though we’re going to get a very large rate of
liquidation, but not until the second half of this year.”

Inflation Contained

The yield on the 10-year Treasury note fell 2 basis points
to 3.52 percent as of 11:25 a.m. in Tokyo, according to bond
broker Cantor Fitzgerald LP.
Greenspan said inflation will be contained during the
current slowdown before picking up as the world economy recovers.
“It’s difficult to imagine any major breakout of inflation
as economic slack continues to increase,” he said. “What we
will see is gradually rising inflationary pressures that will
probably be subdued during the current period of slack, but that
will surely reemerge when economies pick up.”
Greenspan spoke via satellite from Bloomberg Television’s
studio in Washington, answering questions from Peter Hooper,
chief economist at the securities unit of Deutsche Bank, which
hired Greenspan as a consultant in August.
Greenspan, who retired in 2006 after 18 years as the U.S.
central-bank chief, has come under increasing criticism for his
policies as last year’s subprime-loan meltdown spread into a
broader financial crisis. One recent book, “Greenspan’s
Bubbles” by money manager William Fleckenstein, argues the
former Fed chief helped inflate stock and home prices.

Left to Bernanke

In response to the bursting of the Internet and technology
bubble and the Sept. 11 terrorist attacks, Greenspan lowered the
Fed’s key rate in 2001 from 6.5 percent to 1.75 percent, then
reduced it further in 2003 to 1 percent, a 45-year low.
He left the rate there for a year before starting to raise
borrowing costs in quarter-point increments, leaving it Bernanke
to decide when to stop. Some Fed critics, such as Bear Stearns
Cos. economist John Ryding, say rates were too low for too long,
encouraging the easy credit that helped inflate a housing bubble
and has now returned to burn investors.
Greenspan, who published his memoir “The Age of
Turbulence” in September, has taken to defending his legacy in
newspaper opinion articles.
Yesterday, in a Financial Times piece headlined “The Fed
is blameless on the property bubble,” Greenspan wrote that the
evidence is “very fragile” that Fed interest-rate policy added
to the U.S. bubble and that “it is not credible that regulators
would have been able to prevent the subprime debacle.”

Worst Credit Crisis

Greenspan said today that “the current credit crisis is
the most wrenching in the last half century and possibly more.”
Such remarks echo the assessments of economists including
those at the International Monetary Fund, and may add to
pressure on policy makers to strengthen their response to the
credit crunch. Fed officials last week acknowledged that capital
markets remain distressed even after the fastest interest-rate
cuts in two decades, and may be rethinking their aversion to
acting against asset-price bubbles.
After last month’s near-collapse of Bear Stearns,
Minneapolis Fed Bank President Gary Stern — the longest-serving
policy maker — said on March 27 that it’s possible “to build
support” for practices “designed to prevent excesses.”
Greenspan, in yesterday’s FT piece, reiterated his doubts
about taking a more active role in leaning against asset bubbles.
At least 14 banks and securities firms have sought cash
from outside investors in the past year after more than $230
billion of global markdowns and losses caused by the collapse of
the U.S. subprime mortgage market, Bloomberg data show.
Bernanke, 54, told Congress last week that the U.S. economy
may contract in the first half of 2008 and for the first time
acknowledged the chance of a recession.
Later today, the Fed releases minutes of its March 18
interest-rate decision and any other conference calls in
February and the first half of March. The Federal Open Market
Committee that day lowered its benchmark rate by 0.75 percentage
point to 2.25 percent, capping 3 points of cuts since September.

–With reporting by Toru Fujioka and Jason Clenfield in Tokyo,
Craig Torres in Washington and Vivien Lou Chen in San Francisco.
Editors: Russell Ward, David Tweed

To contact the reporters on this story:
Scott Lanman in Washington at +1-202-624-1934 or
slanman@bloomberg.net;
Lily Nonomiya in Tokyo at +81-3-3201-3423 or
lnonomiya@bloomberg.net

To contact the editor responsible for this story:
David Tweed at +81-3-3201-2494 or
dtweed@bloomberg.net.