Monday, November 4, 2013

Keystone's Morning Wake-Up 11/4/13

Fed's Bullard pumps the markets this morning with happy QE easy money forever comments. S&P futures jump about 4 handles as he talked, now at +7.50. The bulls have both utilities, UTIL 504.41, and copper, JJC 40.20, in their camp, creating market bullishness. Watch to see if either turns bearish today.  Copper is weak in early trading. For the SPX starting at 1762, the bulls need less than 4 points higher to tag the 1766 handle and an upside acceleration towards the 1770+ handle will occur. Futures are pointing this way. The bears need to push under 1753 to accelerate the downside. A move through 1754-1765 is sideways action. If UTIL stays above 504.41, and JJC above 40.20, and SPX moves above 1766, and all remains above, Keybot the Quant will likely flip long. The 8 MA is under the 34 MA on the SPX 30-minute chart signaling bearish markets for the hours ahead, however, there will be a fight today between these two important moving averages.

Factory Orders at 10 AM will create a market pivot point. Fed's Powell speaks at 11:40 AM. Fed's Rosengren speaks at 4 PM. The big excitement is set for later in the week with the ECB rate decision first thing Thursday morning and the Monthly Jobs Report (delayed one week) and Consumer Sentiment on Friday. Markets may meander sideways early in the week. The new moon passed yesterday and markets are typically bearish through the new moon, however, seasonality-wise, markets are typically bullish from the last day of the month through the first 4 days of the new month. A major Bradley turn occurred yesterday so the trend change may have been identified by the market top last week. This week will have to play out; the bulls may have a surprise in store. Watch UTIL 504.41, JJC 40.20 and SPX 1766 and 1753 to determine market direction.

Note Added 3:50 AM on 11/5/13: The bears ran with the ball early in the Monday session taking copper and utilities lower but after lunch the bulls ran UTIL above 504.41 causing the afternoon market buoyancy. Volume was very light. UTIL 504.41 and JJC 40.20 will continue to dictate market direction. Copper is slightly higher this morning so the bulls may be trying to set up the conditions for a move higher. S&P futures are -2.

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