Keystone's Morning Wake-Up 4/30/12

EOM today so the monthly charts receive new data points. Japan and China markets were closed overnight due to holiday.  Sixteen Spanish banks receive a downgrade from S&P and Spain is confirmed to be in recession. The RBA expected cut of 25 bips this evening requires watching.  Markets should be unresponsive to the cut since it is priced in but a 50 bip cut (not expected) would bounce commodities and equities. Personal Income and Outlays, a fave data point for the Fed, hits shortly. Lots of Fed heads talking every day this week.

Sticking to the technicals, watch SPX 1407 which will launch further upside. Watch 1408.47 since this was the starting number for April.  At the close of trading today, above 1408.47 locks in another positive month but below 1408.47 locks in the first negative month since November 2011, five months ago.  Watch 1397 on the bear side since losing this level will usher in accelerated market selling.  A move thru 1398-1405 is sideways action today.

The dollar is stronger today, the euro weaker, thus, commodities, copper and equities should be weaker and that is the case currently.  Watch CRB 311 and JJC 48.25.  CRB is helping the bears right now and JJC is helping the bulls.  With copper projected to be a bit weaker today, JJC 48.25 will tell a lot.  If the markets sell off after the open but JJC stays above 48.25, the bears got nothing.  But if the markets sell off and JJC drops under 48.25, the bears got game.  SOX, semiconductors, are important, the 418.75 level is the bull-bear line, currently favoring bears and helping prevent the markets from moving higher.

Utilities are important as well moving almost 5% higher in twelve days. This is bullish for markets so watch to see if weakness appears in the utes moving forward, or not.  As long as UTIL stays above the 450-455 range bulls are fine. If price drops into and thru this range, the broad markets will be in trouble.  UTIL sits at 470 well above danger. JJC and SOX are the keys to broad market direction today. The Nasdaq futures are leading the S&P's lower pre-market which places a small feather in the market bears cap to start the day.