Keystone's Midday Market Action 6/19/13; FOMC Rate Decision, Forecasts and Chairman Bernanke Press Conference

Mortgage Applications are down this morning with the refi's flat. The trend remains lower and the Housing Starts were not impressive yesterday continuing to question the housing recovery. FDX beat on EPS this morning but top line was light like most other companies these days. Shipping is a key bellwether and FDX lowered guidance while saying 3,600 employees are 'leaving voluntarily'. That is a lot of folks, perhaps they were made to walk the plank to help them arrive at the appropriate decision.

Same-o metrics are in place today as recent days. Watch UTIL 488.48 and GTX 4764. UTIL is dropping as trading begins now at 488.92 so today's theatrics begin.  GTX jumps to 4797. Dollar/yen 95.05. TRIN spikes above one helping bears but is drifting back down towards the neutral one, now at 1.15. Yesterday the TRIN closed near the uber low 0.50 so a TRIN above one is needed to relieve the bullish euphoria. Markets may maintain a flat posture today until the Fed this afternoon. Strike up the calliope and begin the parade. The circus main event is 2 PM EST with the Fed statement and Forecasts and then Chairman Bernanke's Press, or rather Desk, Conference begins at 2:30 PM. Markets will pivot on the news and Q&A today. Bernanke purchased fuzzy slippers from WMT last evening since he plans on quietly side-stepping each question to maintain the status quo.

Note Added 9:43 AM:  UTIL bounces off the 488 handle on the first try, now she falls again, 488.87 ...... Bears got nothing unless they push UTIL under 488.48. VIX is above 17.

Note Added 10:07 AM:  UTIL drops under 488.48 for a couple minutes but bounces so the bulls are in control at UTIL 489.21. The short minute charts favor the bounce but the 30-minute and one and 2-hour charts appear to be hinting at some further weakness in UTIL moving forward. GTX 4804. Dollar/yen 95.03. Euro 1.3390. SPX 1649.45. HOD 1652.23 holding under the 62% Fib highlighted on the daily chart at 1652-1654 this morning, so far.

Note Added 11:42 AM:  UTIL keeps teasing 488.48 but remains on the bull side today now at 489.55. Dollar/yen at 95.04. So use these two as the pivots today. Bulls need UTIL to stay above 488.48 and dollar/yen above 95. Bears need UTIL under 448.48 and dollar/yen under 95. For now, markets float sideways. VIX and SPX are both down today so one of them is wrong. TRIN 1.03, neutral. Markets sliding sideways ahead of the Fed. Time for a slice of apple pie.

Note Added 1:44 PM:  Sideways action continues. Yields creep up with 10-year at 2.21%. Dollar/yen 95.17. Euro 1.3410 over 1.34 so the corresponding dollar is weaker which corresponds to traders expecting the Fed to pump the easy money talk. UTIL jumps higher the last 45 minutes now at 490.60 well above 488.48. Since UTIL is moving higher, traders must be expecting the 10-year yield to drop. Utilities will be sold off if yields are on the rise. GTX 4810. Big VIX collapse today from over 17 to under 16 now at 15.87. VIX will continue to create market negativity above 13.75 but the intraday move lower today provides bull fuel. VIX 20-day MA is 15.89 exactly where price is now testing. TRIN 1.03 remaining neutral refusing to favor a side today. The Fed Forecasts and Statement hit in a few minutes and then the Press Conference begins at 2:30 PM. Markets should become volatile. Gather inside the Big Top one and all, the grand main event is about to begin, take your seats.

Note Added 1:59 PM:  UTIL 491.14 the high for the day. SPX 1651. Dollar/yen 95.25.

Note Added 2:02 PM:  The Fed says no change to the purchase program. Markets flat so far. Dollar jumps higher. Gold down. Euro down to 1.3373 as dollar jumps.  Dollar/yen higher 95.66. 10-year yield now hits 2.24%. UTIL jumpy now slipping. Markets need to digest the confusion.

Note Added 2:08 PM:  Markets are selling off, but orderly. TRIN 1.25. UTIL is at 488.31 losing the 488.48, however, Chairman Bernanke is waxing the new money bazooka in the back room that he plans on displaying shortly. Markets should trade wildly up and down for the next hour.

Note Added 2:14 PM:  UTIL recovers above 488.48. TRIN down to 1.00 neutral. Markets recover. This erratic behavior should continue. 10-year yield is 2.26% so it punched through the 2.23% recent high. Watch this closely into the close. VIX drops to 15.55 under its 20-day MA. Dollar/yen to 96.06, a one point move today which is huge for a currency, so the weaker yen helps equities recover. Euro 1.3351 well off its 1.34+ highs today dropping as the dollar rises.

Note Added 2:23 PM:  10-year is 2.28% so utilities drop. UTIL falls under 488.48. Usually, use about 7 to 10 minutes when prices are testing support and resistance to see if they really want to stay at the new level. Minutes ago, UTIL failed but recovered in six minutes. UTIL failed again at 2:18 PM. Looks like she is lost now which should create market negativity. UTIL now under 487 and dropping.

Note Added 2:31 PM:  The 'Desk' Conference begins. SPX 1647. Dow 15274. UTIL 486.82. TRIN 1.03. VIX 15.83. Compare these numbers after the Chairman finishes Q&A.

Note Added 2:53 PM:  SPX drifting lower to 1642.59. The 20-day MA is 1638.72. Price may want to take a look at this support. UTIL 484.21. Watch UTIL 481.15 since this level will open a trap-door in the equities markets. Keystone takes a couple of heart pills as the tension mounts and rolls the defibrillator closer to the computer.

Note Added 3:19 PM:  The markets continue to drop as the Chairman speaks. The stage manager is frantically making hand signals to end the performance but the band plays on. The manager grabs the hook. If Bernanke talks for another ten minutes the SPX will be down another ten points. UTIL is 482.86 well under 488.48 creating market negativity but remaining above the trap-door market trigger at 481.15.

Note Added 3:26 PM:  Euro 1.3279 now under 1.33 after being above 1.34. These currency moves are big. Dollar/yen 96.70. The 10-year yield is 2.32% with a 2.33% high, the highest yield since March 2012, fifteen months ago.

Note Added 3:28 PM:  The Press Conference ends. Fortunately the Chairman was able to walk off the stage and did not get carried off in a stretcher. SPX 1641 so it lost six. Dow 15215 so it lost 60. UTIL 483.97 dropped due to higher yields. TRIN 1.26, bearish. VIX 15.95 up a touch so slightly more bearish than when the talk began.

Note Added 3:42 PM:  UTIL just lost 482, this is getting serious. Place seats in upright position and install helmets. UTIL 481.15 is the number.  UTIL 482.07 ... 481.97 ... 481.93 ... hang on, bulls better pull up on the stick fast or they are going to hit.... 481.85 .....

Note Added 3:46 PM:  Trap-door. UTIL 481.10 is the number. UTIL printing 481.08 now, failure.... 480.99 ... 480.73. Hang on, the markets may collapse into the close, the trap-door just opened.