The RBA (Aussies) cut rates by a quarter point so the commodities and equities markets are happy. Rumors of a Spain bailout imminent is also pumping the futures higher. The S&P's are up about eight. The European news is mixed, however, since Rajoy himself said minutes ago to not expect a bailout request right away, but, the markets remain elevated. MOS, a key bellwether for the ag sector, misses earnings. Watch the COMPQ and SPX percentages today to see if tech is leading the upside, or not. Yesterday's bounce at the open occurred without the COMPQ leading so the move higher was suspect and sure enough, the markets ran out of gas and drifted lower. AAPL action is important moving forward since it greatly impacts the SPX and especially the Nasdaq, and that over 90% of the funds own Apple, what happens if they want to exit the burning theatre, or more correctly, genius bar, all at the same time? Watch to see if tech leads higher today, if so, the 1460's are on the way, if the COMPQ lags again, like yesterday, markets will leak lower all day long.
The utilities sector and volatility are the two key market drivers right now. Watch UTIL 472.06 and VIX 17.25, both are contributing bullishly to markets now. If UTIL drops under 472.06, or if the VIX pops above 17.25, the broad market selling will increase. In addition, if one of these two turn bearish, and the SPX falls under 1441, Keybot the Quant, Keystone's algo, will likely whipsaw back to the short side. If UTIL remains above 472.06 and VIX below 17.25, the bulls will be on easy street today, sipping Bernanke's booze all day long. For the SPX today, the bulls need to punch up thru 1457 to accelerate the upside which will penetrate the 1460's in quick order. The bears need to push under 1441 to accelerate the downside. A move thru 1442-1456 is sideways action. SPX S/R is 1476, 1474.51, 1472, 1468, 1465.77, 1465, 1461, 1460, 1457, 1453, 1450.49 (10-day MA), 1447, 1444, 1443.47 (20-day MA), 1441, 1440.24, 1440, 1438, 1435, 1434.36 (200 EMA on 60-minute chart), 1433, 1431, 1429, 1427, 1426.63, 1424.
Watch the 8 MA and 34 MA cross on the SPX 30-minute chart, now bullish, to see how that plays out this morning. There are no economic data releases today except for the motor vehicle sales numbers that will hit in dribs and drabs. Watch the euro, now over 129. Over 128.75 and the market bulls are happy. Under 128.30 and the market bears will be happy. UTIL 472.06 and VIX 17.25 will dictate market direction today.
weird markets, Quant is long, but I am making more money on the short side... looks like this whole correction ain't over. Could be a double zigzag or possibly even a 5th wave down in the making with yday's 1457 as the 4th wave high. If the latter, than the 1474 top is it, as that would mean a 5-wave decline, which is impulse and leading direction.
ReplyDeleteKS, I liked your comment from yesterday: watch your wallet. This market is as tricky as it gets.
btw, 8sma crossed 34sma...
ReplyDeleteYep, lots of cross currents right now. UTIL 472.06 and VIX 17.25 are the two key things to watch to see if the bulls or bears are winning. The 8 and 34 MA cross is a big win for bears. And of course, watch the wallet as well. When Keystone opens his wallet, moths fly out.
ReplyDeleteA tip if you travel, especially folks on a vacation where you are around crowds, place some rubber bands around your wallet and put it in your pocket, the pick pockets will not be able to pull it out without you noticing.