Keystone's Morning Wake-Up 8/30/13; EOM; Consumer Sentiment

EOM today. August started at 1686 so a down month should be logged at 4 PM EST when all the monthly charts receive new prints. It took the whole day but JJC (copper) finally gave it up in the final minute of trading falling to 39.96. It is amazing how Keybot the Quant algo can identify these important levels before they occur. Watch JJC  39.97 since it is now a key pivot. Equity markets move higher if JJC moves above 39.97 and equities will move lower if JJC moves lower. Copper is down in early morning trading.

SPX is 1638.17. The 100-day MA is 1638.96. The 20-week MA is 1642.83, a sturdy ceiling. Last week's low 1639.43. The bulls need to touch 1646.50 to create an upside acceleration  The bears need to push under 1631 to accelerate the downside. A move through 1632-1645 is sideways action to end the week. The 8 MA is under the 34 MA on the 30-minute chart signaling bullish markets ahead, however, the 8 MA is curling downwards and a negative 8/34 cross may occur today. BPSPX is now a market sell signal.  Markets receive a couple-day pop from the high TRIN and uber low NYAD discussed earlier this week. It is surprising to not see equities far lower and weaker. Perhaps the weak copper will kick in further downside today.

Traders believe strongly in the Fed and worship at Chairman Bernanke's feet; the junkies need the drug-pusher. CPC and CPCE put/calls continue to show complacency. VIX is climbing towards 17 but still not near 20 so overall, traders continue to lack fear. There are dip-buyers in the market more worried about missing the next big run-up in stocks rather than worrying about the markets selling off in any substantive way. Copper is key. S&P futures are flat to positive. If copper is weak (JJC sub 39.97), markets should be weak. Chicago PMI is on tap at 9:45 AM and Consumer Sentiment will create a 10 AM market pivot.

Note Added 9:34 AM:  JJC 39.68. SPX 1638.35 with the dance around the moving averages and last week's low continuing (pink numbers above). TRIN is 0.87 after dropping to 0.64 at the first minute, trying to help the bulls. Markets should weaken if copper remains weak. WTIC crude is under 108, Brent is under 115, and gold is under 1400, since the U.K. does not want to strike Syria and all the war rhetoric is easing. KKD is slipping on a stale donut laying on the dirty tile floor.

Note Added 10:20 AM:  Markets pivot lower at 9:55 AM on the release of Consumer Sentiment. The copper weakness today is causing the market weakness. VIX is 17.11, so each day, begrudgingly, another bull becomes a touch bearish, but overall, traders remain complacent and are not worried.  Most traders are likely more concerned over the pending picnic's and barbeque's on tap this 3-day holiday weekend than trading. The bears need to break down through 1631 to create a downside acceleration. SPX is printing 1635.81. LOD 1633.91 so watch this number. TRIN is 0.88 which keeps the bulls in the game today. Markets are typically bullish in front of a holiday weekend, typically bullish on a Friday afternoon, and typically bullish from the last day of the month through the first four days of the new month, however, the Syria situation, emerging market currency crises and numerous other macro headaches give traders pause.

Note Added 11:01 AM:  The 8 MA stabs down through the 34 MA on the 30-minute chart signaling bearish markets for the hours and days ahead. See if it holds. SPX 1632.67.  LOD 1631.84 so watch this number. The first test of 1631 support holds.

Note Added 11:44 AM: SPX testing the critical 1631 support now. Bounce or die. LOD 1630.85 so watch this number.

Note Added 1:08 PM:  Secretary Kerry takes the podium to speak about Syria and chemcial weapons. The SPX loses 1631, then 1630......, then 1629 ......

Note Added 1:12 PM:  VIX is 17.80 printing the HOD.  A few more traders are becoming concerned, seeking protection by buying volatility, with each word Kerry speaks. SPX 1629.20. The 1627 is the strong support that should send prices far lower if ruptured. The 10-year yield is 2.75%.

Note Added 1:15 PM: Kerry becomes squishy after all the talk of bravado. VIX jammed lower. SPX big bounce to 1634. Thus, a round trip of drama, from 1634 to 1628 to 1634 in twenty minutes time.

Note Added 1:20 PM:  Markets are jumpy like a deer in the headlights not knowing which way to leap. Kerry says the U.S. does not have to wait for the U.N. inspection report so it looks like the U.S. may strike Syria at any time before Tuesday. The SPX 1633-1634 appears to be a pivot level today, bulls win above, bears win below.

Note Added 2:21 PM: Equities are leaking lower with the SPX testing the 1631 support again, and bouncing again.  President Obama was to speak at 2:15 PM but the Whitehouse is typically late, like now, but he should take the podium any minute. Perhaps a few more Tomahawk's needed loaded on the war ships before he starts talking. Oil and gold remain steady, SPX is slightly under the 1633-1634 pivot. Markets await the news from the president.

Note Added 2:40 PM:  SPX is drifting higher now above the 1633-1644 pivot. VIX leaking lower. The president is no where to be seen. Send out a search party. He may not want to speak before 4 PM since equities are starting to float higher.

Note Added 2:51 PM:  The president's remarks are taped comments and the president repeats a lot of Kerry's squishy talk. Sounds like a strike on Syria is a 'definite maybe'. The Syria picture appears cloudier than ever but the markets view it as less aggressive so the SPX floats sideways with upward buoyancy at 1634.47. Traders are ready for the holiday weekend. There goes one sneaking out the back door. He is easy to spot wearing a straw hat, sandals and a Hawaiian-shirt.