Keystone's Midday Market Action 3/13/13

Flat day thus far.  TRIN was in the bear's favor at 1.3+ today but leaked back down to the neutral 1.00. A TRIN above one and the bears win today, below one and the bulls win. The SPX stutters along sideways. The 8 MA remains under the 34 MA on the SPX 30-minute chart signaling bearish markets for the hours and days ahead, however, the previous chart shows how the 8/34 cross is teetering on a tightrope and can move either way over the next couple hours. VIX is 12.36 up a smidge. GTX is tumbling lower again now at 4847. Copper remains weak all day long. Watch the TRIN, now at 1.02, it will tell the tale.

Note Added 3/13/13 at 12:43 PM:  CNBC business television reports that David Tepper remains long the markets and is looking for 20% more upside for the broad indexes this year. Tepper is head of Appaloosa Management and is known for his rally call when QE2 was announced in Fall 2010 telling everyone to buy stocks since the Fed's printing will send markets higher, and he was correct, so the QE2 rally from late 2010 to early 2011 is known as the Tepper Rally.  In December-January, a couple months ago, he made the same call saying this recent round of QE, QE4 Infinity and Beyond, that replaced Operation Twist with outright purchases, will result in another upside orgy, and obviously Tepper is exactly correct once again since this year is all up so far. Thus, on news that he is looking for more up, the SPX pops three handles over the last fifteen minutes. Of interest today is that both the Retail Sales and Business Inventories data were positive blow-out beats, but the markets are flat, that is something different. This year thus far, bad news is ignored, and the good news results in several S&P handles upside for each positive news bite, but, that may be changing?  The 8 MA is about to cross the 34 MA to the upside which would signal the bulls back in control. The bears need Popeye's can of spinach right now to stop the upside. From this morning's notes, the bulls need to touch 1557 and the upside will explode higher into the 1560's. The HOD today is 1555.60. TRIN is 1.07 so that hints that the markets should weaken again. If the TRIN would drop to 0.90 and lower then the bulls will run the markets higher and send the SPX up through 1557.  For now, the bears can keep the upside in check with a TRIN above one.

Note Added 3/13/13 at 1:05 PM:  The 10-Year Note Auction results in strong demand, lower yield, traders continue to desire perceived safety. The money that folks want to park goes into Treasuries while the mad money and higher-risk cash plays in the casino equity markets.  TRIN pops to 1.12 but now at 1.07. The beat goes on. SPX is 1554-1555. The 8 MA now moves a hair above the 34 MA signaling bullish markets ahead but this move is shaky; the day will have to play out. The Tepper comments, in essence Fed pumping, saves the day once again. With the TRIN above one, however, the bears may still have a surprise in store today.

Note Added 3/13/13 at 1:23 PM:  Direxion announces reverse splits for some of the triple X speculative ETF's including MIDZ, FAZ, TZA, YANG, EDZ, TECS, NUGT and ERY. The change will occur 4/1/13 so if you hold any of these you will see an adjustment to your account. The total dollars you hold will not change but the price for each will increase and the shares decrease, depending on the split, from 1 to 3 to 1 to 6 depending on the ETF.

Note Added 3/13/13 at 3:24 PM:  White smoke appears at the Vatican and the new Pope, Pope Francis I is now speaking on the balcony. Best wishes and good luck to him. Speaker Boehner tried to horn in on the action with a quick speech highlighting his meeting with President Obama, but all that baby talk on both sides sounds like the same old stuff. The Continuing Resolution (CR) deadline to fund the U.S. government is 3/27/13, only 13 days away.  The SPX punches out a new high today at 1556.39, interestingly, not yet able to touch the 1557 handle that will launch the upside. The SPX intraday high for 2013 at 1556.77, printed yesterday, remains in place.  TRIN is 1.16 so the bears are showing some back bone today. Note that the TRIN dropped into the 0.9's at 1:45 PM, and bounced, which directly corresponds to the high in the SPX today. The action over the last few days is remindful of the back half of December going into the fiscal cliff deadline. The markets were very complacent back then, like now, and the TRIN printed several numbers under 1.0 in early to mid-December, just like now, which exploded into higher TRIN's above 1.00 that led to the December selloff into the first day of the year where the fiscal cliff resolution then saved the day.  The set up now is very similar with the CR less than two weeks away. The broad indexes are flatter than a newlywed's souffle as the markets head towards the close. Volume remains anemic at less than two-thirds of a days average expected volume. Euro 1.2957. The 10-year yield 2.02%. VIX 12.03. GTX 4849.

Note Added 3/13/13 at 4:03 PM:  Dow is up nine days in a row printing new all-time highs day after day; now a new high at 14472.80 and new closing high at 14455.28.  The SPX closes at 1554.51 unable to print a new high for 2013 and unable to attain 1557 to ignite an upside acceleration. The bears kept the TRIN above one all day which limited the market upside. As the day moved along, the VIX was beaten and closed under 12. Oil, copper and commodities were hit again today as the realization hits that the China, Asia and emerging markets in general may not be as rosy as thought. The equity markets do not care, however, and keep inching higher. The 8 MA is above the 34 MA on the 30-minute charts signaling bullishness ahead but tomorrow needs to play out to see if the bears can reverse the 8/34 cross to the downside. Dr. Copper is ill laying on a gurney in sick bay but no one is worried about silly ole market parameters that lead the broad indexes.