Keystone's Midday Market Action 10-17-11

Interesting start to the trading day.  As of Friday's closes, as measured by Keystone's algo, utes were bearish and financials and volatility were bullish. All three flip flopped at the open today. Utes are bullish now, but financials and volatility are bearish.

Continue monitoring UTIL 436.75 (now printing 439.26 market bullish), XLF 12.55 (now at 12.44 market bearish), and VIX 29.25 (now at 30.90 market bearish).

Note Added 10/17/11 at 12:22 PM: Status quo. UTIL is elevated above 436.75, XLF is below 12.55 and VIX is above 29.25, thus markets languish sideways after the early selling. Also watch SPX 1205.65 and the low today is 1207 so no worries at this juncture. If you want to see serious selling, UTIL has to drop under 436.75 and SPX under 1205.65, if that does not happen the bears got nothing. If bullish, you want to see XLF or VIX become agreeable to the levels shown, if not, the bulls got nothing. UTIL, XLF and VIX hold the key, keep watching.

Note Added 10/17/11 at 12:57 PM:  SPX lost 1205.65 for two minutes. UTIL remains above 436.75 so SPX recovered. Watch UTIL closely, the down side can only accelerate if UTIL cooperates.

Note Added 10/17/11 at 1:30 PM: Note how UTIL launched at 1:03 PM and this led the SPX's recovery off the lows. Market bears got nothing unless UTIL loses 436.75.