Keystone's Midday Market Action 1/7/13

The bears stood strong and prevented UTIL 466, so far.  Look at the utilities fall like a stone, UTIL now 461. So the market bears crack a smile.  The SPX is sold, now printing 1459.11.  This is the test of 1459 support.  What say you markets? The 10-year yield sits at 1.90%.  Keystone tried to short some USG but the broker could not find any shares.  Instead shorted BAC opening a new short position. For BAC,negative divergence is in place, it received a little pop today.  Keystone was waiting for the 80/20 rule to play out. 8's lead to 2's so 8 led to 12.  Then once it was at 11.80, that leads to 12.20, which occurs today. BAC has momo so some sideways topping may be needed.

Note Added 1/7/13 at 9:58 AM:  The SPX is fighting along the critical 1459 support, neither side giving way. This is important since a downside acceleration would occur but also a failure would make 1444 support in play moving forward. The indicators are weak and bleak for the SPX hour charts, so price should continue lower as the morning plays out. UTIL just fell thru 460. VIX is back above 14 but no where near 15. The 8 MA is converging on the 34 MA on the SPX 30-minute chart so keep an eye on that since it will lock in a bear move for the hours ahead, or not. Reference the SPX 30-minute chart on the weekend scrolling back a page. Time for a slice of pumpkin pie.

Note Added 1/7/13 at 12:05 PM:  The 8 MA stabbed down thru the 34 MA on the 30-minute chart signaling bearish markets for the hours and days ahead.  Watch this into the close to see if the 8 stays under the 34.  AAPL went positive but is now negative again. The euro popped above 1.31 but has dropped back under.  Oil moved up but now moderates. UTIL is under 460. The 10-year yield is now at 1.89% dropping under the 1.9 level.  The SPX lost the strong 1459-1461 support, so a several handle drop would be in order, as long as price stays under 1459 for a few minues. SPX support below is 1457, 1453, 1451, 1447, 1446 and 1444. TRIN is 1.49 representing orderly selling. The TRIN was under 0.85 as the bulls tried to push the markets higher this morning. The TICK is traveling between +500 and -500 representing a relatively calm and orderly day, no extremes as yet. Orderly selling is a good description for today. The SPX is testing 1457 support. With the bulls unable to send UTIL above 466, and the bears unable to bring the VIX up over 16, neither side ate their Wheaties today, and a sideways standoff-style action is occurring in the markets.

Note Added 1/7/13 at 1:35 PM:  The SPX languishes sideways under 1459 for two hours but the bears could not gain any traction, the 1457 support has held thus far. Tech is not leading the downside so the bears do not have oomph. Price is now back up to back kiss the 1459 right now. Thus, the SPX should either jump above 1459 and recover today, or, collapse.  Bounce, or die.

Note Added 1/7/13 at 3:30 PM:  Bounce.  The SPX is at 1462.  The bears cannot gain downside momo since tech is not leading lower, copper recovered, AAPL is flat, oil flat, euro back above 1.31, and VIX remains low at 14.  Bulls are trying to push higher but will not be able to gain momo unless GTX moves above 4955 (now very close at 4910) or if UTIL moves above 466 (UTIL is weak all day now at 460). This strong 1459-1461 support/resistance level was key going into today and it lived up to its billing. The next resistance level above is 1465. Note how the 8 MA is curling upwards on the 30-minute chart. The bulls are trying to reverse the bear signal that triggered at noon time. The market bears need to drive the broad indexes strongly lower right now if they want to maintain negativity.

Note Added 1/7/13 at 3:45 PM:  Markets meandering sideways into the close. Keystone bot PANW, a data storage IPO play, a young speculative issue, opening a new long position. The charts are positively diverged but this may be developed into a longer term hold since data storage efficiency should be a key focus by the tech sector this year. Will take it for a ride for a little while and see what happens.

Note Added 1/7/13 at 4:05 PM:  The 8 MA remains under the 34 MA on the 30-minute chart forecasting bearishness ahead but the 8 is now curled up and converging on the 34 from the underside. The opening bell is very important tomorrow. With an upside move at the open, the 8 will move up thru the 34 and the bulls will be running to match last weeks highs. The bears have to come to play immediately at the opening bell tomorrow and drive the broad indexes lower out of the gate, to prevent the 8 MA from moving up thru the 34 MA, therefore, bears need to see red futures overnight tonight or the bulls will run a couple days or more. UTIL closed at 459. This is a win for market bears today since the bulls were only a point away from the 466 as the day started.  UTIL 466 remains in play.