Keystone's Wake Up 4-12-11

AA is reacting as was forecasted a few days back from the charts and technical analysis; negative divergence is a powerful force.

Small business optimism survey did not show much optimism. 

If market bears push the SPX under 1321 they can get something going.  Bulls would need to hit a 1334 handle to move momo back in their favor today.

SPX:VIX printed a near 80 handle at yesterday’s close.  Large market selling will not occur unless this ratio drops under 68.  If the ratio does not go under 68, then any broad market selling will be a non event.  Thus, watch the volatility today, VIX.

Key sectors to watch today are utilities, semi’s, copper and financials.  Watch UTIL 405 level.  If UTIL falls below 405, this will spell disaster for the broad markets and the market selling will continue along for the days ahead.  If, however, the UTIL can maintain a level above 405, then any selling should be short lived.

Markets continue in this sideways topping and rolling over funk for the last half year.  Tough to make big money in these sideways markets. The doves Chairman Bernanke, Yellen and Dudley are affecting traders’ minds negatively with all their bearish economic talk and is a big reason for this weak feel in the markets the last few days.

The big tell today comes at 2 PM with the release of the new POMO schedule; markets may idle ahead of this release.  The last couple hours of trading today may be very volatile so set your schedule accordingly.