Keystone's Midday Market Action 5/16/12

Housing Starts were much better than expected, printing above 700K, which is an upside surprise.  NYA is printing 7660 above the critical 7628.  RTH is 41.20, bear-friendly under 41.38. SPX:VIX ratio is 62.24 well under the bull-bear line at 68.  Tech is not leading the upside so the move up should not have much steam.  SPX is printing 1335.52, between the 1337 resistance and 1333 support. Oil Inventories are released at 10:30 AM and FOMC Minutes at the 2 PM hour where a market pivot point should occur.

Note Added 5/16/12 at 9:53 AM:  RTH sitting on 41.38 now, whichever way she goes so goes the markets.  SPX punched up thru the 1337 R.

Note Added 5/16/12 at 10:34 AM:  RTH likes the underside of 41.38 favoring bears, so far. NYA remains above 7628 which keeps the bulls away from a secular bear market.  SPX:VIX ratio is 64 four points under 68 favoring bears.  Probably sideways settling in until the FOMC minutes this afternoon. Tech is not leading the upside. Watch AAPL now only up a buck on the day.

Note Added 5/16/12 at 2:39 PM:  RTH and SPX:VIX are bear-friendly all day long and they pulled the markets lower.  NYA failure at the 40-week MA at 7629. NYA now printing 7604. The broad indexes have fallen into a secular bear market. See if the sub 7629 print holds thru the close today. The 2 PM FOMC minutes created a market pivot point.  The Fed shows a mixed bag of opinions and no confidence in the economy. The markets pushed under 1328.50 so a downside acceleration would be expected. SPX LOD is 1325.95 which is not much of a downside push.  Remember, 1326 is strong sturdy support, if it gives way a test of the 1314-1318 area will come, so, for the first test, 1326 S held.

Note Added 5/16/12 at 3:06 PM:  NYA comes up for a back kiss of 7629 and ..... fails again. Now printing 7620. This NYA battle for 7629 will provide drama into the close today.

Note Added 5/16/12 at 3:18 PM: NYA is at 7607. SPX is hanging out near the lows so another test of 1326 S may be on tap.

Note Added 5/16/12 at 3:49 PM:  SPX tested 1326, bounced, here she comes again......

Note Added 5/16/12 at 3:52 PM:  NYA is printing 7600, check that, 7599, secular bears are growling strongly. SPX fighting at the critical 1326 support, if it fails it will mean that about 8 to 12 more handles of downside will be coming in the days ahead.

Note Added 5/16/12 at 3:55 PM:  SPX lost 1326, printed a 1324 handle, now a back kiss of 1326..................

Note Added 5/16/12 at 4:15 PM:  SPX closed at 1324.80, so it did tumble four points under the 1328.50 projection from this morning afterall. NYA closed at 7593 signaling a return of the Secular Bear. Growl.