On the technical side, the bulls need to push UTIL above 506.22 and/or GTX above 4874 to reestablish the market upside. The bears need to push JJC under 40.20 and/or VIX above 14.60 to increase the market selling. If all 4 parameters remain in their respective camps, the markets will stumble sideways. For the SPX today starting at 1763, the bulls need to push above 1775 to regain their mojo, a formidable task, but not impossible. The bears need to push under 1757 to accelerate the downside. A move through 1758-1774 is sideways action. S&P futures are -5 as this missive is written. Keybot the Quant remains short through all this market drama and despite the market buoyancy the last few days. If UTIL moves above 506.22 or GTX attains 4874, and the SPX moves above 1775, and stays above, Keybot will likely flip long. The 8 MA stabbed down through the 34 MA on the SPX 30-minute chart signaling bearish markets ahead in this VST time frame so watch to see if the bears maintain control, or not. Bring up an SPX daily chart and note the 5/22/13 market top which occurred on Chairman Bernanke's words. Yesterday's candlestick and Fed announcement is very similar where price leaped higher early in the day and then failed. The fractal from late May may repeat moving forward (price dropped for 2 days after 5/22, then popped to a lower high, then began the May-June selloff into the June low). UTIL 506.22, GTX 4874, JJC 40.20 and VIX 14.60 dictate market direction.
Note Added 10:19 AM: The status is quo. Chicago PMI blows out to the upside so perhaps traders are worried about QE ending in these bazaar markets. UTIL is collapsing with a 497 handle. GTX is 4786. JJC 40.54. VIX 13.89.Thus, all 4 parameters remain in their respective bull and bear camps so the expectation is sideways equities but clearly utes and commodities are weakening further with volatility popping which provides a slight edge to bears so the SPX is down slightly leaking 4 points lower to 1758. Bears need a couple more points to create a downside acceleration. TRIN is 0.79 favoring the bulls today. Perhaps traders need a day of rest after yesterday's drama, plus time to prepare for trick or treating this evening. Bernanke and Yellen masks are the most scary masks of all. Keystone took profits on EUO (double X inverse euro ETF) and will look to reenter; it should have plenty of upside ahead (this is the short euro long dollar theme highlighted over the last few days).