Keystone's Midday Market Action 3/20/12

The first day of spring ushers in feelings of love in the air but alas, love for bears but no love for bulls today. Housing Starts are key to the economy and the numbers were in line without surprise; the spring weather all winter long in the Northeast U.S. continues to create optimism in the sector.  China and European auto sales are weakening which is trouble for the perceived global recovery. Housing and auto's are important industries using rubber, chemcials, resins, metals, copper and plastics so the continued funk is not forecasting the health in the global recovery that pundits keep cheering.

The dollar is up today so equities are down.  The market bears needed to punch down thru the 1402.50 level for the SPX to accelerate the downside and this occurred.  UTIL is key today as described in the prior chart. The market bulls are holding it all together since UTIL is now printing 451.24 above the danger level of 447. UTIL did drop down to punch at a 450 handle mintues ago. The SPX is down -0.80% while the Nasdq is down -0.84% so the market bears have a slight advantage currently. SPX S/R is 1407, 1406, 1403, 1399, 1396, 1394, 1391 and 1389.  The 10-day MA is 1386.61. SPX is currently operating in the 1396-1399 zone and should test 1396 S now that 1399 failed.

Copper weakness is a game changer today.  While we are watching the UTIL 447 as a market failure signal, here comes JJC getting whipped hard today.  If JJC loses the 48.90 level, now at 49.18, the broad markets are in big trouble, only a measley 28 cents away. Market bears got nothing unless JJC 48.90 or UTIL 447 fail. Markets are served up a red AAPL today instead of the green Apple day after day in recent trading.

Note Added 3/20/12 at 10:32 AM:  After an hour of trading, JJC is at 49.40 above the 48.90 danger level and UTIL is actually up a point today to 453 above the 447 danger level.  The SPX lost the 1402.50 level favoring bears, and then came up for the back kiss at 10:10 AM, now languishing sideways. Lower prices would be anticipated but the market bears got nothing unless they can push copper or utes lower.  Note that the dollar has weakened today as the session moves forward, barely hanging on to a slight positive number today, thus, the markets have regained their composure. Dollar down = up markets and dollar up = down markets. See if today's failure and ceiling at 1402.50 resistance holds, or not.

Note Added 3/20/12 at 12:23 PM:  The bull and bear battle continues.  UTIL is maintaining buoyancy since Treasury yields backed down a touch.  Commodities and copper are weakening on dollar buoyancy.  CRB has a 316 handle three points above the 313 danger level.  All you need to watch is JJC, now at 49.05.  The 200-day MA support at 49.17 failed, the 50-day MA at 49.04 is the last support ahead of the critical 48.90. The market bears need only 14 more measley pennies lower for JJC and the broad markets will sell off substantially. The dollar is telling you the story.