Keystone's Midday Market Action 7/31/12

Copper, JJC, is flat, remaining under 44.20, preventing further market upside. Note the VIX coming up to test the 18.75-18.80 level highlighted this morning.  The market bears did not have the strength to push up thru, however, at least so far today, the VIX now printing 18.40.  Thus, the bears want to see 40 cents more (18.80) to start moving the broad indexes lower.  If the VIX stays under 18.80, the markets will languish sideways and the bulls are fine.  Keystone's SPX:VIX Ratio Indicator is 75.18 remaining seven points above the critical 68 level showing that the bulls maintain a firm market grasp. Tech (Nasdaq) is a hair positive on the day while the broad markets (SPX) are a hair lower, thus, tech is leading the upside favoring the bullish side. The 10 AM ConCon number did provide a pivot, which was down for markets, but the jaggy sideways action today is not committing to either side. SPX continues to hug the 1385 level, now moving in a sideways range overall thru 1381-1391 for almost two days. Bulls will win at 1392 and higher, bears will win under 1381. VIX 18.80, and SPX 1392 and 1381 holds the key today. If the status quo remains, with VIX under 18.80 and SPX between 1381 and 1392, then markets will languish sideways and traders are content to wait on Chairman Bernanke when he brings the tablets down from on high tomorrow and provides the market answer.

Note Added 7/31/12 at 11:17 AM:  Several tickers have Keystone's interest today as possible plays but the choppy nature of markets perhaps places hammock time ahead of trading time.  Adding more RIMM (long) is of interest, more CEP (long), maybe buying GNK (long), maybe a CTRP long, utilities are attractive shorts, WMT as a short now since it displays attractive negative divergence on daily and weekly charts, maybe DNDN as a long off their earnings beating, also a pull back in energy may come so perhaps an energy short.  All are very short term trading considerations.  For now, watching, paying attention to VIX 18.75-18.80 where the bulls and bears will fight for market control. FB is puking again down 5% today, the chart is ugly, Keystone's 80/20 rule says 2's move to 8's, so if FB closes under 22, that would hint that 18 may be on the way.  An FB long is perhaps not a consideration until 17.70-18.20 but even then, the stock is damaged goods and best avoided. Other than that, perhaps a slice of pie then some hammock time.

Note Added 7/31/12 at 12:26 PM:  Bears are attacking SPX 1381 but the bulls are preventing failure so far.  Specifically, watch 1381.37 as the line in the sand. If the SPX stays under 1381.37 for a few minutes, the markets will take a leg lower.  The VIX is at 18.60, under the critical 18.80 level the bears need.  This morning, as the SPX moved lower, the VIX had spiked higher to test higher levels than now, which hints that perhaps this market weakness will not have legs.  SPX 1381.37 and VIX 18.80 will tell you the answer in the minutes ahead.

Note Added 7/31/12 at 12:35 PM:  SPX is under 1381.37, see if it holds. The VIX, however, is at 18.66.  The bears are a hair away from victory if they can muster up 14 more cents in the VIX (18.80), otherwise, the market bulls will recover today.

Note Added 7/31/12 at 12:44 PM:  Watch Keystone's SPX 30-Minute Chart with 8 MA and 34 MA Cross indicator showing the 8 MA at 1384 heading down and the 34 MA at 1382 heading up.  Perhaps a cross is in order in the coming hour, watch it closely. The bears will be favored for the days ahead if the 8 MA stabs down thru the 34 MA.  If a cross does not occur, markets will have to spike higher to avoid the cross. So there is some drama ahead. SPX:VIX ratio has a 73 handle remaining above 68. SPX recoverred above 1381 but now is in trouble again.  Copper is negative. VIX is at 18.67; bears got nothing unless they move the VIX above 18.80.

Note Added 7/31/12 at 12:56 PM:  VIX 18.71 .... 18.73 ... well, bears, do you got what it takes?

Note Added 7/31/12 at 1:02 PM:  SPX 1379 handle but VIX at 18.74. Keystone took profits on TWM exiting the trade.

Note Added 7/31/12 at 1:27 PM:  Keystone bot DNDN opening up a new long position; the stock is receiving a beating after earnings but the charts are positively diverged; this is an extremely speculative and dangerous trade.

Note Added 7/31/12 at 1:42 PM:  Tech continues to lead the upside which helps stall any bearish market move.  SPX is now back above 1381.37. VIX is 18.65, the bears did not have the juice to move up thru 18.80, at least so far. Keep watching SPX 1381.37 and VIX 18.80, and the SPX 30-minute chart, the 8 MA now a hair away from crossing down thru the 34 MA which would usher in bearishness for the days ahead.  The markets should either bounce strongly and move up, or the SPX will collapse down thru 1381, in the minutes ahead, say over the next hour or so.

Note Added 7/31/12 at 1:53 PM:  Keystone bot TWM reopening this trade.

Note Added 7/31/12 at 1:55 PM:  Bears are making a run lower again; SPX near 1381.37 and VIX is at 18.71. Do you got what it takes this time bears?

Note Added 7/31/12 at 2:06 PM:  Bingo. The 8 MA moves down thru the 34 MA on the SPX 30-minute chart; this is very bear favorable moving forward. Reference the Turn Signal page on this site for more information and the previous signals.  Let some time pass to see if the 8 MA stays under the 34 MA, if so, the bears will gather strength.

Note Added 7/31/12 at 2:36 PM:  Keystone added more TWM but the bear side cannot gain steam to the downside unless the VIX moves above 18.80.

Note Added 7/31/12 at 3:07 PM:  VIX is at 18.64, the bears cannot move the volatility above 18.80 no matter how hard they try. Perhaps they need Popeye's spinach. The 8 MA remains under the 34 MA on the SPX 30-minute chart so this is a significant bearish development, as long as it holds thru the close. VIX moving above 18.80 would seal the deal for the bears, until then, markets remain in limbo. SPX is at 1381.45 a hair above the important 1381.37 for today.

Note Added 7/31/12 at 3:40 PM:  The last twenty minutes are providing drama; SPX 1381.37 and VIX 18.80 is where the action is.

Note Added 7/31/12 at 3:48 PM:  SPX failed thru 1381.37 but the VIX continues to favor the bulls at 18.60.

Note Added 7/31/12 at 3:59 PM:  Keystone took profits on the TWM day trade exiting.  Also added more DNDN.  Also bot CTRP opening up a new long position.

Note Added 7/31/12 at 4:02 PM:  Look at the VIX playing its games all day long until the final minute.  Things are settling out, VIX at 18.88. A very interesting finish, best to let the smoke clear and see if there is any more of the blueberry pie remaining in the frige.

Keystone's Morning Wake-Up 7/31/12

EOM today so the monthly charts will receive a new final print at 4 PM. CRUS earnings beat last evening so this will create buoyancy in AAPL (parts are used in Apple products) and the tech sector. Copper did not move up yesterday so the market bulls were held in check. The Dow Industrials log nine down Monday's in a row. Continue using JJC 44.20 as the trigger for a strong sustainable upside market move, otherwise, the upside is limited.  Watch SOX 376.00, now at 380.61. Bulls need to stay above 376 while bears need to push under 376.  Watch VIX 18.80, now at 18.03. Bulls need to stay below 18.80 while bears need to push above 18.80.  Watch XLF 14.45, now at 14.73. Bulls need to stay above 14.45 while bears need to push below 14.45. Watch Keystone's SPX:VIX Ratio Indicator, now at 76.83; 68 is the key level that will signal strong bearishness, above 68 and bulls are fine. The CPC put/call chart posted last evening highlights the complacency in the markets. Despite any traders waxing worry on television or in other media, traders are not worried, they are in fact worry-free and complacent, fully expecting the central bankers to pat their behinds forever forward. Remain cautious and attentive in these markets.

Case-Shiller data is released at 9 AM EST; this will impact the housing sector trades including Keystone's SRS trade.  Chicago PMI at 9:15 AM provides insight into manufacturing strength, or lack thereof, as well as a hint concerning employment for later in the week. One of Keystone's most important monthly indicators, due to its tangible correlation to markets, is Consumer Confidence at 10 AM. Expect a market pivot point. The trading session should settle in after this trio of economic data occurs this morning since traders will await Chairman Bernanke's delivery of promises on Wednesday at 2:15 PM.

For the SPX today starting at 1385, the bulls need to touch 1392 and the bears need to push under 1381 to create acceleration moves in their respective directions.  A move thru 1382-1391 is sideways action today. China hints at further easing policies, especially to spur the domestic economy, but the futures markets are not bouncing on that happy talk.  Tech led the downside yesterday. Note that last week tech led the upside bolstering the rally move.  As this missive is written at 6:15 AM EST, the Nasdaq futures are up 0.37% and the S&P's are up 0.24%, hence tech is leading the upside today thus far, so market bulls are smiling. Watch this relationship into the open. In a nutshell, SPX 1392 and 1381, JJC 44.20, SOX 376, VIX 18.80 and XLF 14.45 will dictate broad market direction today.

CPC Put/Call Daily Chart Complacency Rules Markets Forming Significant Top

The CPC is now printing in the 0.7's firmly signaling that traders are complacent and have no worries at all about the markets going down.  With the Bernanke and Draghi puts underneath the markets, where the central bankers vow to do whatever it takes to support the markets, traders are drinking the Koolaid, and the CPC shows that there is no fear about a market sell off, instead, the vast majority of traders expect markets to continue higher.  Of course, when traders are fully loaded to one side of the boat, the markets do the opposite.  The red squares show significant recent market tops, all occurring when traders were complacent and worry free thinking that markets will not go down. As would be expected by this contrarian indicator, the markets topped and rolled over at each red square.

Conversely, once markets sell off and the broad indexes tumble lower, traders become worried, novice traders tend to sell at the bottom, the exact wrong time.  They do that out of fear thinking that the markets will not recover and that the markets will continue falling.  The black squares show where the market fear was rampant, and, as expected, the markets bounce instead, punishing the majority of traders that were shorting the markets thinking the end of the world was at hand.  Projection is that a significant market top is now being formed which should result in a roll over and strong downward move for the markets in the days ahead. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your finanical advisor before making any investment decision.

Keystone's Midday Market Action 7/30/12

The bulls launched a run at SPX 1389, bumping their heads for the first hour but then pushing up thru. This leads to the strong resistance level at 1391 in quick order where price is having difficulty.  Typically, the acceleration move would be several handles but the 1391 is putting up a fight.  The SPX is up 0.28% and the Nasdaq is up 0.15% so tech is not leading the broad markets. This is one reason that price is having trouble moving thru SPX 1391 thus far today.

Telecom continues to run as Ma and Pa continues to pump the Dividend Stock Bubble higher; Keystone's T short trade is feeling pain.  Note that copper is negative all day thus far. JJC is down a nickel to 43.39. The bulls need 44.20 to signify substantial and extensive market upside ahead. Thus, SPX plays around the 1389 S/R, held in check by tech not leading the broad indexes higher and weak copper. Watch 1391, if price punches up thru and stays above for a few minutes, 1400 plus is on the way.  To stop the market upside, the bears must push hard preventing 1391 and also push price back under 1389 and lower. The +955 TICK at 10:22 AM marked the top for the broad indexes thus far today. The NYAD has pulled back trying to burn off the uber bullishness. The TRIN is at 1.03, actually favoring the sell side above one, despite the higher move in the markets today. Utilities run higher but remain extremely attractive from the short side.

Note Added 7/30/12 at 11:02 AM:  Markets settling into a sideways vibe.  Watch SOX 375.30, now at 381.26.  Bears need six points lower to cause market damage; bulls are fine above 375.30.  Watch VIX 18.80, now at 17.89. Bears need a point higher to cause market damage; bulls are fine below 18.80.  SPX S/R is 1394, 1391, 1389, 1388, 1385, 1377 and 1374. The Nasdaq is now red, tech is leading the broad markets lower. So sideways is the direction for now. The upside is held back since copper is weak and tech is not leading the upside. The bears cannot gain traction on the downside since the SOX and VIX are not cooperating. Time to fire up the tractor and catch up on some mowing.

Note Added 7/30/12 at 1:04 PM:  Status quo. Dow Industrials remain above 13K. The SPX 1385 S/R level is serving as resistance ever since it failed at 11:19 AM EST.  Since 1385 failed a test of 1377 would be in order.  JJC remains weak and the Nasdaq continues to lead the broad indexes lower.  The VIX remains under 18 and the SOX is at 379.18. Traders may be playing a waiting game since the excitement will steadily grow thru the week beginning tomorrow.  Case-Shiller is at 9 AM, Chicago PMI at 9:15 AM and Consumer Confidence at 10 AM that will likely create a market pivot point.  The Case-Shiller data wiill affect Keystone's SRS trade.

Note Added 7/30/12 at 1:30 PM:  Keystone closed out the UNG trade. Natty came on long and strong as expected but the entry into this trade was too early (February-March). Probably will result in about a 10% loss, no biggie, losses will be written against gains this year for tax purposes. Actual loss will be calculated once the books clear this evening. Natty remains favorable moving forward but the recent run looks to be coming to an end chart-wise so a rest would be in order for natty before then resuming the uptrend.  The textbook W pattern bottom in UNG and natty is very attractive for the intermedate and longer term, especially since the W is under the 50 and 20-day MA's which provides extra strength for the pattern.

Note Added 7/30/12 at 3:00 PM:  Uneventful day today, meandering sideways. Traders appear content to float the indexes sideways.  SPX 1385 S/R is the location of the action today; the close above or below will be of interest. Perhaps the final hour will provide excitement.

Note Added 7/30/12 at 4:00 PM:  SPX 1385.29 as price settles out at the close.  The market action should ramp up beginning tomorrow.

Keystone's Morning Wake-Up 7/30/12

European leaders are continuing to pump and praise the central banker's coming intervention.  Geithner will meet with Draghi today.  Spain's recession deepens. The Libor Scandal feeds the public mistrust of the banksters. Draghi promises action but Germany may not be entirely on board. The Fed must deliver a pony on Wednesday at 2:15 PM and the ECB a few hours later on Thursday morning before the U.S. markets open. The Monthly Jobs Report is on Friday morning.  Consumer Confidence at 10 AM Tuesday will kick the crazy trading week into high gear.

Talk will increase concerning back-to-school sales which are a predictor of upcoming Christmas sales.  The Retail Sales number on 8/14/12 will provide an early indication of the back-to-school sales.  Many parents are probably telling Johnny that his back pack can be used one more year and Jane is told to write on the back of last years' paper instead of buying a new tablet.

The Dow Industrials are over 13K; time will tell if 13 is a lucky number, or not.  For the SPX today, starting at 1386, the bulls need only three points, to push thru 1389 and an upside acceleration will occur, the sturdy 1391 resistance level will likey give way, and the SPX will be on its way to 1400. The futures overnight remain red so the bears are trying to push back and stop the upside momo. Copper is very important today. If the JJC overtakes 44.20, the bulls will be running over SPX 1400 in the coming days. The bears must make a stand and prevent 44.20 at all costs which will stop the market upside. Copper and commodities move opposite the dollar and the dollar is currently flatish, neither side wanting to tip their hand in the early going as the new trading week begins. SPX 1366 is important support below. A move on Monday thru 1367-1388 is sideways action.

SPX Daily Chart Showing Bradley Turn Dates 2011-2012

The Bradley turn dates are highlighted for the last year. Note the market inflection points that typically occur on these dates.  The Bradley turn dates for 2012 are 12/28/11, 1/11/12, 1/28/12, 2/16/12, 2/22/12, 3/16/12, 4/11/12, 4/23/12, 6/12/12, 7/28/12, 8/14/12, 8/25/12, 9/30/12, 10/9/12, 11/1/12, 11/14/12, 12/22/12 and 1/20/13. The bold dates are major Bradley turn dates.  The Bradley turns do not predict direction, only that a market inflection point may occur.  Sometimes the moves result in an acceleration move either up or down such as the major turn on 12/28/11 which resulted in a continued upside acceleration move for markets.

The major turn date on 3/16/12 results in nearly calling the market top this year thus far. The major turn on 6/12/12 created a Bradley window, which is +/- seven days each way, from early June to late June, and early June marked the recent market bottom.  Saturday, 7/28/12, was a major Bradley turn and we sit directly in the center of the window right now.  The wild upside market rally late last week, within the Bradley turn window, may be the result of this current major turn which would point to stronger markets moving forward.  Conversely, the spike in the broad indexes prints the current high to start this new week of trading, exactly on top of the actual Bradley turn date.  Thus, the whole week must play out this week before the results of the Bradley turn can be assessed. Perhaps a market top will be identified, although this would fly in the face of all the stimulus talk from central bankers that is creating the market buoyancy.

Note that there are seven more turns remaining in 2012, in five months time, so a wild end to the trading year may be on tap with very choppy markets. Watch the action this week to see how this major Bradley turn resolves itself.  For more information, reference the Bradley Siderograph, Donald Bradley, Peter Eliades and Arch Crawford web sites. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here. Consult your financial advisor before making any investment.

MUB Muni Bonds Negative Divergence

The muni bond bubble continues along undaunted.  Keystone is looking for a top in the muni's as one of the yearly predictions but waiting for that is like waiting for Godot.  The MUB weekly chart is setting up nasty, however, so Godot may be coming into eyesight.  As soon as price registers a higher high than February, which in essence it is now, the red lines for the indicators will lock in the wcked negative divergence.  Price should receive a strong spank down from the red circle moving forward.  The short green lines show a long and strong profile in the shorter couple month time frame so a stutter step at these levels would be in order, then a smack down and roll over. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

SRS UltraShort Real Estate Weekly Chart Falling Wedge Positive Divergence

SRS, a 2x inverse ETF that moves opposite to the real estate sector trails lower into the black falling wedge.  The green lines show the positive divergence now in place that should bounce price.  Keystone opened a long postion in SRS on Friday. An entry anywhere from 24.70 to the current 25.33 level appears attractive. Projection is for a bounce in SRS at anytime, likely in conjunction with weaker housing sector news. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

SPX Daily Chart Negative Divergence Upward-Sloping Channel

Big three day upside from 1329 to 1389, 60 handles, which reinforces an upward-sloping channel for the last 2 1/2 months. The green lines show the long and strong profile during June that wanted to see higher highs with price. The higher prices printed but the red lines show the indicators rolling over and exhibiting negative divergence.  This caused the spank down six days ago. SPX 1391 is important resistance above and 1366 is important support below.  Price is also honoring the 50-day MA at 1335 as support. The blue square in May and the one in June shows where the uber euphoric +1500 TICK numbers occurred like Friday's super high TICK.  After those uber high TICK's, the SPX had an intraday or two day tumble of from 17 to 30 handles before recovering to new highs.  The NYAD printed over +2000 and TRIN prints 0.28, the lowest close (signaling uber bullishness) since December over one-half year ago. The markets are begging for a snap back move lower to relieve this bullish pressure.

For the two bullish days, volume remained below the volume seen in June at lower price levels.  If the markets were strong, the volume should exceed the previous levels. Watch the red lines for the indicators over the last six days to see if the negative divergence remains in place or if any of the indicators move higher; the RSI is flatish currently. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Keystone's Key Events and Market Movers for Trading the Week of 7/30/12

Keystone presents the following underlying market currents, sometimes subtle, sometimes turbulent, that move global markets in real time.  The key dates and times below typically correspond to market pivot points.

Key Dates and Times for the Week Ahead:

·         Keystone’s Comments on the Upcoming Week:  The European debt crisis drama took a positive turn last week on the talk of stimulus from the Fed and ECB central bankers.  Since ponies were promised, and the equity markets responded violently to the upside, the ponies must be delivered this week on Wednesday at 2:15 PM EST and Thursday morning about 7 AM EST. Geithner is flying over to meet with European officials tomrrow. Obviously, something changed this week with the European drama since the new urgency and action by the CB’s occurred and smacks of desperation. Either Greece has completely blown up fiscal-wise, or one or more of the Spanish regions are in failure, or other negative scenario has occurred. Perhaps this week the answer is provided.  Spanish and Italian bond yields have pulled back on the happy easing talk.  Bank runs and European riot worries now take a back seat to the happy stimulus talk.  The European news flow directly dictates global market direction. Congress is in session for a few more days which is a market negative. Watch for further China easing measures such as lowering triple R’s which will bounce equity markets. Earnings season remains in full swing. Many companies warned so the bar is low enough to provide easier beats. About three-quarters of the companies are in line or beating with EPS, which is typical, but over one-half of the companies are reporting top line revenue numbers that are missing expectations clearly showing that the overall economy remains sick underneath the surface.  Sectors to watch are steel, shipping, oil refiners, energy, water and utilities. A major Bradley turn date occurred on Saturday so a Bradley turn window is open this week for a major market turn to occur. The acceleration rally move may have already identified the turn since the window runs from 7/16/12 thru 8/3/12. Hang on to your hat, Wednesday thru Friday this week will be a circus.

·         Monday, 7/30/12: Dallas Fed Mfg Survey 10:30 AM. Earnings: APC, CALM, CRUS-provides insight into AAPL, DBD, DNDN, EMN-chemicals and plastics are the building blocks of all recoveries, FISV, FLS, GLRE, GMO, GNOM, GRO, HCA, HLF, HTZ, INVE, IDTI, KWR, LMNX, MSO, MAS-important for housing sector, MPWR, NABI, NEU, NU, NWPX, OSIR, STX, SPPI, STEM, VRTX, VVUS, WTR, YRCW.

·         Tuesday, 7/31/12: EOM-monthly charts receive new prints today. FOMC 2-day meeting begins. Employment Cost Index and Personal Income and Outlays 8:30 AM. S&P Case-Shiller House Price Index 9 AM. Chicago PMI 9:45 AM. Consumer Confidence 10 AM-potential market pivot point.  Farm Prices 3 PM. Earnings: ALL, ADM, BMC, COH-retail, DRIV, EIX, EA, FMC, GERN, HRS, HW, HEP, KLIC, PFE, PZZA, FIRE, TARO, X, VLO, YNDX.

·         Wednesday, 8/1/12: Mortgage Purchase Applications 7 AM. Motor Vehicle Sales-is the auto industry stumbling? Challenger Job Report 7:30 AM. ADP Jobs Report 8:15 AM. PMI Mfg index and Treasury Refunding Announcement 9 AM. Construction Spending and ISM Mfg Index 10 AM-potential market pivot point.  Oil Inventories 10:30 AM. FOMC Meeting Announcement 2:15 PM-expect a market pivot point. Full Moon (markets are typically buoyant moving into the full moon). Earnings: AMT, ADP, AGN, AVP, BALT, ED, DVN, ERII, EXC, FCN, GNK, GGP, HOG, HUN, H, ICE, IPI, MET, MUR, OC, PAR, PRU, SIGA, RGR-gun sales will be in the news, SNCR, THOR, TSO, SAM, HIG, TWX, RIG, VG, WLT, WTW, WMB, YELP.

·         Thursday, 8/2/12: BOE Rate Decision. ECB Rate Decision and Press Conference 7 to 8 AM EST. Jobless Claims 8:30 AM. Natty Inventories 10:30 AM. Fed Balance Sheet and Money Supply 4:30 PM.  Earnings: ALTI, AIG, AMSC, AWK, APA, AVEO, BEAM, BDX, BBG, BCRX,CAH, CBS, CKP,  DUK, FLR-gauge of engineering activity, GM-the national embarrassment, GTLS, K, LNKD, MWE, MELI, MTZ, MCP, MWW, NFG, NILE, OMX, PRX, PH, PWR, RDC, SD, SRE, SWN, SE, SUN, SFY, TDC, TWC, TIE, UPL, WNR, XEC, XEL, ZIP.

·         Friday, 8/3//12: Monster Employment Index.  Monthly Jobs Report 8:30 AM--this report is one of four remaining before the presidential election in November; October is the most important. ISM Non-Mfg Index 10 AM.  Earnings: BID, BPL, DRC, EOG, PG, SOL, TNH.

·         Wednesday, 8/8/12: 10-Year Note Auction 1 PM.

·         Thursday, 8/9/12: Jobless Claims 8:30 AM. 30-Year Bond Auction.

·         Tuesday, 8/14/12: PPI and Retail Sales 8:30 AM.

·         Wednesday, 8/15/12: Spanish stress tests due from independent auditor. CPI 8:30 AM.  Industrial Production 9:15 AM.

·         Thursday, 8/16/12: Jobless Claims and Housing Starts 8:30 AM. Philly Fed 10 AM.

·         Friday, 8/17/12: Consumer Sentiment 10 AM.

·         Wednesday, 8/22/12: Existing Home Sales 10 AM. FOMC Minutes 2 PM.

·         Thursday, 8/23/12: Jobless Claims and New Home Sales 10 AM.

·         Friday, 8/24/12: Durable Goods Orders 8:30 AM.

SPX S/R Week of 7/30/12

SPX support, resistance, moving averages and other important levels are highlighted below. The SPX price is now above all the important moving averages, even the 10-day MA, a very short term support indicator, is 25 points lower at 1360. Markets catapulted higher on the Fed and ECB central banker easing talk as well as all European leaders jawboning solidarity. The SPX jumped 60 handles in three days.

The 1389 resistance placed a ceiling on the move. This level is key for Monday trading. If the bulls punch up thru 1389 after the opening bell, watch to see if the overnight futures are green by three or more points, another upside acceleration will occur causing more bear pain. SPX 1391 is very strong resistance and if it is taken out, the 1400's are on the way.

The bears need to push down thru the support levels at 1385, then 1377, to stop the upside momo.  When price pushed up thru the strong 1366 level, that pointed the way higher, so bears need to target the 1366 as their short-term goal. Bears can reestablish market negativity under 1366 but that is nearly 20 handles lower.  A move thru 1367-1388 is sideways action for Monday's trade. If the bears push markets lower, and achieve the sub 1366 print, next focus your attention on the strong support gauntlet at 1357-1360. The bulls are running currently on the Bernanke and Draghi stimulus fuel. Since these two carnival barkers promised ponies, one pony must be delivered Wendesday afternoon (Fed) and the other pony on Thursday morning before the U.S. markets open (ECB) to justify and sustain the upside.

·        1565 (10/9/07 top)

·        1525

·        1500

·        1440 (5/19/08 Intraday HOD for 2008: 1440.24)

·        1427 (5/19/08 Closing High for 2008: 1426.63)

·        1425 (Gap Fill from 2008)

·        1424

·        1422 (4/2/12 Intraday HOD for 2012: 1422.38)

·        1419 (4/2/12 Closing High for 2012: 1419.04)

·        1417

·        1415 (5/1/12 Top 1415.32)

·        1413

·        1410

·        1406 (5/29/08 HOD)

·        1403

·        1399

·        1394

·        1391

·        1389.19 Friday HOD

·        1389

·        1388

·        1385.97 Friday Close—Start Monday Here

·        1385

·        1377

·        1374

·        1371(5/2/11 Intraday HOD for 2011: 1370.58)

·        1370

·        1366

·        1364 (4/29/11 Closing High for 2011: 1363.61)

·        1363

·        1362

·        1360.20 (10-day MA)

·        1360.05 Friday LOD

·        1359.97 (20-week MA)

·        1359.32 (100-day MA)

·        1358

·        1357.64 (20-day MA)

·        1355

·        1351

·        1349.18 (200 EMA on 60-Minute Chart)

·        1347

·        1346.67 (150-Day MA; the Slope is a Keystone Cyclical Signal)

·        1343

·        1341

·        1338

·        1337

·        1335

·        1334.60 (50-day MA)

·        1333

·        1331

·        1330.08 (10-month MA)

·        1329

·        1326

·        1324

·        1321

·        1319

·        1318

·        1317.91 (200-day MA)

·        1316

·        1314

·        1312

·        1308

·        1307

·        1305

·        1304.26 (12-month MA; a Keystone Cyclical Signal)

·        1300

·        1298

·        1296

·        1295

·        1294.04 (50-week MA)

·        1293 (10/27/11 Intraday High 1292.66)

·        1292

·        1289

·        1287

·        1286

·        1285

·        1281

·        1278

·        1277

·        1275