SPX moves up thru the 20-day MA at 1407.60, a feather in the bulls cap, and moves up to 1410 to signal the all clear for more upside, but considering the Bernanke talk is only minutes away, price is idling for now. Copper, JJC, moved above 43.70, now printing 43.78, so the bulls are determined to have a happy weekend. With JJC above 43.70, today will belong to the bulls. Chicago PMI slightly disappoints. Consumer Sentiment is 9:55 AM then Bernanke and Factory Orders at 10 AM. Consensus is that Bernanke will not offer much today. Hang on to your hat, it is time to venture into the lion's den.
Note Added 8/31/12 at 9:49 AM: JJC loses 43.70 now printing 43.63, this is more important than what you see in the broad markets, it signals bearishness today but lots of fits and starts should occur over the coming minutes.
Note Added 8/31/12 at 9:55 AM: Note the back kiss of the SPX 20-day MA at 1407.45. Consumer Sentiment is better than expected. Keystone needs his heart pills as the palpatations increase. Nurse Cratchett is wheeling the difibrillator closer to the computer.
Note Added 8/31/12 at 10:30 AM: Keystone wants a refund form the Jackson Hole Symposium. As usual, an event can never live up to its high expectations. Bernanke says a whole lot of nothing. Markets sold off a few points but are now traveling sideways. Tech is not leading higher today so the upside does not have oomph. Copper remains weak with JJC at 43.47. The 8 MA remains below the 34 MA on the SPX 30-minute chart which is bearish for the hours and days ahead. The TRIN is printing uber lows this morning, now at 0.41, so this will beg for a snap back move of broad market selling either this afternoon or on Tuesday. NYAD printed +1900 today, high, but not uber high, it does show bullish enthusiasm, so there remains many complacent traders afoot. Watch the key parameters today, since JJC is under 43.70, the market bears only need one of the following to cooperate, SOX 390, VIX 18.35, UTIL 464 or NYA 7836, but alas, all four continue to prefer the bull camp, so the market sideways malaise continues. The 20-day MA is an important support and resistance (S/R) level for all tickers and indexes, use it for all your plays. The SPX 20-day MA is 1407.45 and the current print is 1407.54. The price action above or below the 20-day MA is important.
Note Added 8/31/12 at 11:07 AM: Markets move higher with the SPX testing the strong resistance at 1413 but JJC remains bearish. Tech and the broad markets are up the same amount so tech continues to not lead the markets higher. Looks like a hazy lazy day of summer is shaping up as traders think about the weekend barbeque and potentially sneaking out the back door when no one is looking. Markets are stumbling sideways but if JJC moves above 43.70, the SPX will run towards 1419. VIX is at 17 printing a LOD of 16.92.
Note Added 8/31/12 at 11:21 AM: The 8 MA is coming up to cross up thru the 34 MA on the SPX 30-minute chart, perhaps over the next hour, which would be a feather in the bull's cap for the coming hours and days. The ony way the bears can stop the upward move in the 8 MA would be if the SPX price sharply reversed to the downside now. JJC is at 43.60, bearish by ten cents and preventing the markets from moving higher. TRIN is down at 0.36. The prior times that TRIN was this low marked the top in the SPX in mid-June and the top in the SPX in late July.
Note Added 8/31/12 at 1:37 PM: The SPX is dancing around the strong 1403 S/R level. JJC is at 43.69 playing around at that 43.70 level. UTIL is at 467.36, remember, Keystone said to watch for 467.35 at 4 PM (since this number is important for next week), perhaps the utilities are already setting up that fight. The 8 MA moved up thru the 34 MA on the SPX 30-minute chart at 12 noon, bullish, but the 8 MA is now curled back down again. Watch this chart thru the close to see if the bears wrestle back control, or not. The SPX is under the 20-day MA at 1407.27 which is bear friendly. Tech continues to move with the broad markets, both are up about 0.3% today, not providing an advantage to either market direction. JJC 43.70 is important, the fight continues. Gold obviously believes in QE3 catapulting higher to 1690 today.
Note Added 8/31/12 at 3:30 PM: The pre-holiday upward bias continues. JJC is sitting directly on top of 43.70. The 8 and 34 MA on the SPX 30-minute chart are on top of each other now as well. The resolution of these two tools will tell a lot for the set up for next week. Also, if UTIL closes under 467.35, that portends bearishness when markets begin trading again on Tuesday.
Note Added 8/31/12 at 4:07 PM: JJC closes at 43.71, bullish. The 8 finishes above the 34 MA on the SPX 30-minute chart, bullish. UTIL closes above 467.35, bullish to start next week (watch this number all next week). Helicopter Ben, pre-holiday happiness, the blue moon tonight, it is all coming up roses for the bulls today. The entire week the SPX moved sideways thru the 1399-1413 range, thus, the move from this range will be significant. SPX closed below the 20-day MA at 1407.40, bearish. Gold hits the highest level in five months at 1694 breaking out, moving up and away from the descending triangle pattern and now far above its important 65-week MA. Bernanke pushed the dollar lower today which pushes gold, commodities and equities higher. Happy Labor Day. Time to light the barbeque.
JJC 43.52 this is very bear, that's why the markets are in the red right now and down.
ReplyDeleteThat is correct Anon. If JJC goes above 43.70, the market bulls will send markets higher. Markets will experience negativity as long as copper, JJC, stays under 43.70. This reference number will change slightly over time but the 43.70 is valid for the days ahead so use it as a gauge for broad market direction. Copper is key to global health since it is needed for housing, construction and automobile industries. If there is very little infrastructure projects ongoing, and if car sales are slipping, you do not need copper, and it tells you the markets are in trouble. In great times copper will lead the markets higher, Dr. Copper.
ReplyDeleteWow, wild swings. Weird. No QE3, but it maybe coming to your inbox anytime. WT"peep" over... Same old same old. What's there to rally on? This market is getting weirder by the day. Once you think you have the EWT count down, it's wrong the next day. Thanks to KS I can understand better why.
ReplyDeleteEither way, the market whiped both shorts (from yesterday) at the open, then longs at the first drop today and now??? Sustained up move? Who knows.
Arnie, I saw a good comment on ZeroHedge that a lot of today's gains after Bernanke could be put down to stop-running. And there's a lot of interpreting of Ben's remarks (Hilsenrath, Gross, et.al.) to mean more QE in September. I don't see that, judging from his speech and comments (I might take a closer look over the long weekend if I'm bored). The CRB is still a long way from the 250-270 range. And if you're already paying $5 for bread and too much for gas, would the FOMC really make a move before the election?
DeleteWeaver, thanks for explaining. Seemed like stop-running indeed give it's back at 1404ish again. The uforia didn't last long (like KS pointed out a few days ago with the kid and candy... Promisses will only last so long)
DeleteIf this will become another intra day reversal day like 2 weeks ago, then there is some serious downside potential IMHO.
8sma above 34, but for how long? Neither bull nor bear has been good at keeping the ball as of late for much longer than a day or two.
JJC is 43.62 now, at 11:30 AM EST, so if it stays under 43.70 the broad indexes will not move up much and should run out of gas. If JJC 43.70 gives way to the upside, the bulls will run the SPX to 1419 ahead of the holiday weekend. JJC 43.63 now.
ReplyDeleteMr. Market has to take a rest. Back down to ES 1370's.
ReplyDeletethis is a joke....
ReplyDeleteYes, it is a circus, the Fed destroyed the markets with all their intervention. Once the volatility moves higher, that will improve the trading environment. The key events will be the ECB, Draghi, and we wil know that before trading begins on Thursday, and then the Monthly Jobs Report is Friday morning. The broken record continues; watch JJC 43.70. And UTIL 467.35 at the closing print today.
ReplyDeleteMore waiting... I hate being short in a big way up bunch an then getting a big 30 minutes candle to hammer out on you and recover the big whoosh down reversing gains into big loses.. its been a bad week...
DeleteIt is a shame indeed. Grabbed some more uvxy at 5.25, as I pointed out the other day that has held as nice support.
ReplyDeletewhat's your sell point for UVXY Arnie? tks in advance.
DeleteHey testy,
DeleteI am looking at the August 3 gap, at first hand, somehow that needs to get filled. Then possibly the July 26 gap. As gaps tend to get filled. But, 5.75 has been sturdy resistance over the past month and that needs to be taken out first IMHO. So price targets are: 5.75, then 6, then 7, then 8.5. But one step at the time.
On UVXY, look at the indicators such as RSI, stochsatics, etc...., long and strong on the daily chart so even after a further pullback, price will want to come back up to 5.75 and higher. That is a juicy gap 6.5-7.0. It looks good.
ReplyDeleteHigh drama. JJC 43.70, exactly where price is at now. Also the 8 and 34 MA cross is being determined. These two tools will say a lot for Tuesday's trade.
Thanks for confirming what I am also seeing; that gives me confidence. Today was a really, really weird day. Notice the big drop in the last 2 minutes. That's not a good close IMHO. Indu lost almost 30points... Hmmm, shananigans today?
DeleteEnjoy a well-deserved 3 day weekend KS and et al. This was the 2nd red week...
Gold and silver and breaking out.
ReplyDeleteDo you still think it goes below 1525?
Gold is at highest level in five months, breaking out higher. Give it thru next week, since it was a straight dollar weaker, gold higher move today, and appears to be a bit overdone. The base line level to watch is 1575 for the bear case. So, above 1660, gold bulls are driving the bus and will continue to. Between 1575-1660 is the standoff area. Let it settle in for the next few days. The move up may exhibit a successful back kiss of the 65-week MA as well, which furthers the bull case. Looks good for bulls but keep an eye on it all next week, especially early next week.
ReplyDeleteKS, would you able to get out of PAAS today, it's up more than 5% ? Hope it will breakout for you. Good luck! and thanks for everything again.
ReplyDeleteKS, the fact that all your key indicators have held critical support levels is giving me a gut feeling that we rally big next week. Sept. is well-known to be the worst month on average, so I see a lot of puts on the indices. A rally would "surprise".... the fly in the ointment is sentiment, which is complacent. Maybe we get a blow-off top??
ReplyDeleteOn PAAS, Keystone was in too early on that one so remains a bit underwater, and, considering that the QE talk may be on the table for a while, the trade will likely continue to simmer for a while. Miners, metals and so forth may want to move sideways forward.
ReplyDeleteCharlie, perhaps, but the big news that many missed actually occurred on Friday morning with the hopeful news that the ECB is close to a bond-buying program for Spain's debt, that bounced the markets. Bernanke's talk appears more of the same but the perception, which is all that matters in trading, not the actual truth in news, the perception is that more traders now think QE is coming as soon as 9/12/12. Keystone does ot share that view, there is no immediate threat of deflation so Bernanke is likely far away from QE, but, is sly as a fox on the way he can keep moving time along, hoping that time heals all wounds.
Three easy things to watch at Tuesday's opening bell will immediately provide the answer to market direction independently of what the markets may actually be doing after the opening bell. Copper, JJC 43.70, now on the bull side by a hair. If JJC drops under 43.70, the broad markets will be selling off. If UTIL falls under 467.35, only a point lower, this would seal the deal for bears and the SPX will drop out of the sideways 1399-1413 range for the last week or more, and tumble far lower to 1391 and perhaps lower. If JJC and UTIL stay above those levels, the bears got nothing, and markets will remain elevated. A break thru the 1413 resistance would be an important bullish development.
The third item to watch is the SPX 30-minute chart, the 8 and 34 MA cross Keystone keeps preaching about lately. The 8 is on the verge of stabbing down thru the 34 MA, but the closing bell saved the day, which will signal bearishness for the hours and days ahead. The markets will need a strong upward thrust to prevent the cross. If futures are flat to down that would be bear favorable to start the holiday-shortened week.
TRIN also printed uber low numbers on Friday which begs for a snap back move. On balance, the market bears may be favored a bit more but the above three parameters will immediately provide the answer. Thursday adn Friay are the big days next week. ISM is important on Tuesday.