Monday, November 11, 2013

Keystone's Morning Wake-Up 11/11/13

Happy Veteran's Day and best wishes to all the veteran's for their past and ongoing service to the country. Happy Remembrance Day to our Canadian friends. Bond markets and banks are closed today but the stock market is open. Thus, the interest-rate sensitive stocks such as utilities, telecom, home builders and financials may remain flat today. The 10-year yield is 2.75%. Markets remain a coin-flip overall. The big down day Thursday results in a big recovery day Friday with the SPX bouncing off the 20-day MA at 1749.98. Watch UTIL 508.47 and JJC 40.20. Copper is higher in early trading. Futures are flat. Keybot the Quant remains bearish but the markets remain in a sideways funk through 1745-1775 for the last 3 weeks. If the SPX moves above 1771, and either UTIL moves above 508.47, or JJC above 40.20, and stay above, Keybot will likely flip to the long side. If equities move higher, but UTIL and JJC remain on the bear side, equities will likely lose the upside oomph and drift lower.

For the SPX starting at 1771, the bulls only need to see a positive print at the opening bell and that paves the way to test the all-time high at 1775.22 and march towards 1780. The bears need to prevent utilities and copper from moving higher to keep the market upside in check. The market bears have the ball but they are unable to make any progress. The low put/call ratios continue to signal a significant market top at hand in the coming days. This week is pivotal for markets. Even if the bulls run higher early in the week, the anticipation is that markets should roll over to the downside moving forward. The 8 MA is above the 34 MA on the SPX 30-minute chart signaling bullish markets for the hours ahead. Bears got nothing until they create a negative 8/34 cross. Watch UTIL 508.47, JJC 40.20 and SPX 1771 to determine market direction.

Note Added 5:29 PM:  UTIL 502.04 stumbling sideways all day. Ditto JJC 39.91. Thus, markets stumble sideways. Bulls punch higher to a SPX HOD at 1773.44 but could not develop any upside juice since utilities and copper remain in the bear camp. The beat goes on.

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