Keystone's Morning Wake Up 1/13/12

Today is Friday the 13th.  How appropriate considering JPM's earnings release a short while ago creates a dark cloud over the markets. JPM met on the bottom line but laid an egg for the top line revenue. Speaking of eggs, an Apple store in China was egged after it failed to open because of concern over the large crowd. Perhaps AAPL was more concerned about the scalpers in the crowd or other nefarious goings on.  Anyway, shouldn't the crowd be throwing apples instead of eggs?

At 9:55 AM, Consumer Sentiment is released serving up a market pivot point.  If the bears want to fight back they will have to extend their claws today.  Markets are closed on Monday in Observance for Dr. Martin Luther King Day.  Markets tend to be buoyant into these holiday weekends but the world wide turmoil ongoing obviously carries much greater clout than seasonality factors.

The Farm Report slapped the grains silly yesterday and damaged the CRB. This helps the bear case for the broad markets.  Copper, JJC, however, is enjoying a large jump and is supporting this market bullishness over the last few days.  The retail sector started to stumble yesterday, someone needs to walk up and nudge it over the cliff, it should not take much effort.

As shown by the previous charts posted, the SPX is moving thru a sideways channel 1285-1297.  Today's drama begins at the top side of this channel.  For the SPX today, starting at 1295.50, the market bulls want to see 1296.80, use 1297 since it is easier to remember, which represents the HOD's over the last three days. If the bulls can move above 1296.80, the upside party will be in full force with a 1300+ print on tap ahead of the weekend.

The market bears have the negative divergence on the 30-minute and daily charts on their side, however, which should create a spank down.  The bears need to push the SPX downwards to get under that lower rail of the sideways channel at 1285. This move will immediately pave the way to test 1281. If 1281 fails, the broad markets are in serious trouble. A move thru 1287-1295 is sideways action today.

Friday the 13th may be ushering in market hijinx already. The spoo futures dropped three handles as this missive is written. The SPX is set to open four points lower.