Tuesday, November 12, 2013

Keystone's Morning Wake-Up 11/12/13

As Lawrence Welk would say, a one-a, a two-a and a three-a, or, in today's case, 11, 12 and 13. Three Fed heads will try to pump the markets today. Fed's Fisher, a hawk turned dove recently, now flapping white wings, says 'QE will not last forever' this morning, but, perhaps his words were more relevant when he was a hawk instead of now another member in the wishy-washy camp. NFIB Small Business Optimism Index is released within the one-half hour and always provides interesting insight into business sentiment. Chicago Fed National Activity Index is 8:30 AM, a gauge on manufacturing. The 3-Year Note Auction is 1 PM.

Utilities and copper remain key and provided a lid on the market upside yesterday. Bulls must punch up through UTIL 408.47 and/or JJC 40.19 to continue the upside market party. Copper is weak today. The 10-year Treasury note yield is 2.79%, higher, as it resumes trading after the bond market holiday. The higher yields will likely send utilities lower. The dollar strengthens, with the weaker euro, sending commodities, copper and metals lower. Platinum and grains are remaining firm. For the SPX starting at 1772, the bulls only need 1-1/2 point, to push through 1773.50, to create an upside acceleration to the 1780 handle and new all-time highs. If UTIL or JJC turn bullish today, at the levels highlighted above, and the SPX prints above 1773.50 and higher, and stays above, Keybot will likely flip long. The bears need to push under 1768 to accelerate the downside. S&P futures are -4 which places price at the lower limit for a test as the day of trading begins. A move through 1769-1773 is sideways action.

The 8 MA is above the 34 MA on the SPX 30-minute chart signaling bullish markets for the hours ahead. The 8 MA will not curl to the downside until price drops below 1771.46. Bears got nothing until they attain the negative 8/34 cross.  Key SPX S/R levels are 1775, 1772, 1763, 1759, 1752, 1745, 1733, 1730, 1722, 1706 and 1697-1698. The 20-day MA is 1753.07 and 50-day MA is 1713.14. The all-time intraday high is 1775.22 on 10/30/13 and all-time closing high is 1771.95 on 10/29/13. Note how yesterday missed a new record closing high by only 6 pennies. The charts last evening and this morning show an area of confluence for the SPX at the 1727-1737 area so this may act as a magnet going forward. Watch the 8/34 cross on the 30-minute chart, UTIL 408.47, JJC 20.19 and SPX 1768 and 1773.50 to determine market direction.

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