Keystone's Midday Market Action 1/12/12

The circus events and sideshows this morning did not provide as much entertainment as forecasted. China's inflation data was not too hot and not too cold.  Regardless, copper, JJC, is a rocket ship the last couple days.  The European bond auctions were successful with plenty of participation so the U.S. futures popped on that news.  The ECB did not lower interest rates which was in line with consensus estimates so that news only offered up a yawn.  The U.S. data at 8:30 AM pulled the markets back to earth on lackluster Retail Sales data and Jobless Claims.

The SPX popped at the open but after a few minutes, fell on its sword, tumbling back down thru that critical 1293.80 level for today.  As price broke thru on the way up the markets accelerated and the SPX almost touched 1297 before collapsing. The SPX should come back up for another look at 1293.80.

The CRB is now over 316 pumping bullish life into the markets. More cracks are appearing in the retail sector but individual company stock buy-backs and other magician's tricks are temporary holding back the coming negative divergence retail smack down.

Business Inventories are on tap in ten minutes and plenty more drama after that with Natty Inventories, the 30-Year Bond at 1 PM, and Treasury Budget at 2 PM.

Note Added 1/12/12 at 9:57 AM:  SPX came up to test 1293.80 again, and failed. This little battle is a bear victory. See if price wants to now stay under 1293.80 moving forward, or if it makes another attempt.

Note Added 1/12/12 at 2:40 PM:  SPX came up for another look at 1293.80 at 1 PM and received another spank down. As this is written, SPX catapults higher up thru 1294. On the SPX 30-minute chart, the 8 MA crossed under the 34 MA but now moved above again as the SPX spikes.  The CRB collapsed at 11 AM which is helping create market bearishness. SPX now printing 1294.33, it will probably come back down to test 1293.80 again.

Note Added 1/12/12 at 3:01 PM:  CRB, commodities, lost the 310 level which helps the bear case. Corn, wheat and sugar are hit after the Farm Report today. Oil weakness is interesting taking this morning's chart in consideration.

Note Added 1/12/12 at 3:06 PM:  SPX now back testing 1293.80, and boiiiinnnng, price bounced.