Keystone's Market Action 6-10-11

Wild day so far.  Market bears came to play driving the SPX under the prior days low in short order.  Volatility is elevating, up over 3% today.  The SPX:VIX ratio failed at 68 ushering in more selling and forecasting a huge down move in the indexes--unless it reovers and moves back above 68.  At 11:06 AM EST, the ratio failed at 68, 11:48 AM the ratio went back above 68, 11:56 AM back below, 11:58  AM back above, 12:11 PM back below, and now, from 12:19 PM, above 68 again, so the market bulls are pushing back hard, they realize the importance of keeping this ratio above 68, so keep watching it today to help indicate broad market direction.

The tech-heavy Nasdaq Composite, $COMPQ, turned negative for the year.

The NYA 40 week MA cross almost occurred today but the two year secular bull remains in place, for now.  The NYA is at 8037, the 40 week MA is 8001, thus, only 36 points prevents the broad markets from falling back into a secular bear market.  Watch this closely.

TRIN is at 2.09 verifying that today remains in the bears favor.

Banks showing lots of weakness.  Continue to watch Keystone's 2-10 Spread Indicator which targets 255 as the line in the sand between happy bankers and sad bankers, due to yield curve slope, and now it sits directly at this 255 spread.

Financials and copper have led the swoon since they topped in February, both had lost the 200 day MA's, and now, today, the semiconductors, $SOX, has lost its 200 day MA, bearish.  Watch other major sectors and indexes to note their behavior in relation to the 200 day MA.  The SPX 200 day MA is 1253.

Markets moving within the asset relationship; euro down=dollar up=equities down=commodities down=gold down=treasury prices up with yields down.

SPX:VIX at 69.14, one point above the critical 68 level, so the market bulls do not want to give up.  If the ratio can stay above 68, then a bounce is on the table.  If the ratio loses the 68 level again today, then expect a huge down day, otherwise, prices will moderate as we move towards the weekend.