Keystone's Morning Wake-Up 11/7/13; ECB Rate Decision and Press Conference; GDP; TWTR IPO

The main event is on tap for the minutes ahead; the ECB rate decision is 7:45 AM EST and Draghi's press conference is 8:30 AM.  Draghi's comments at the press conference will likely have a greater effect on futures. Draghi is not expected to cut rates today with a back drop of Europe falling into deflation and manufacturers and exporters desperately needing a lower euro so they can help the continent recover. If Draghi cuts, or does not cut but talks dovishly, the euro should drop, the dollar would pop, commodities and stocks should drift lower. If Draghi does not cut, and he does not talk dovishly, in fact he may take a stance that the euro price is fine at current levels with no need to worry, the euro will pop, dollar will drop, commodities and stocks will likely rally. The euro was 1.36-ish at the October meeting so Draghi may don an Alfred E. Neuman mask and quip, "what, me worry?" The fireworks begin shortly. The U.S. GDP and Jobless Claims are released at 8:30 AM. Chain Store Sales will provide input into the retail sector. Fed's Stein speaks at 9:10 AM and Dudley speaks at 1:30 PM. The constant daily barrage of Fed heads pumping the stock market continues. Natty Gas Inventories are 10:30 AM and Consumer Credit at 3 PM.

UTIL 504.41, JJC 40.18 and XLF 20.40 dictate market direction. Very simply, the bulls need higher copper, JJC above 40.18, to send markets higher. The bears need UTIL 504.41 and/or XLF 20.40 to send markets lower. If the 3 parameters remain status quo, markets will stagger sideways. Copper collapsed -2% yesterday. For next week, the UTIL 508.47 is the bull-bear line in the sand instead of 504.41, and note how the bulls already jammed the utes above 508 yesterday to try and at least maintain an elevated stock market for early next week. As this week ends today and tomorrow, watch UTIL 408.47 closely. If the bulls end the week above, the markets will continue to maintain their elevated action. if UTIL slips into the weekend and stumbles lower, especially down towards 5 hundo and under 5 hundo, this will be a firm signal that the markets are in serious trouble. Do not forget about the low CPC and CPCE put/call ratio's highlighted here over the last 2-1/2 weeks.  The uber low CPC 0.69 and CPCE 0.46 prints, multi-week and yearly lows, signal rampant trader complacency where the vast majority of traders believe stocks will not go down; which is when they do. During the last two weeks, two more low prints occur for each ratio which helps extend the upside happiness but the ratio's continue to signal that a significant market top is occurring at any time, any day forward.

For the SPX starting at 1770, the bulls need to touch the 1774 handle and happy days are here again. The SPX will print new all-time highs on its way to 1780. The bears need to push under 1764.50 to accelerate the downside. A move through 1765-1773 is sideways action. The BOE leaves their key rate unchanged at 0.5%. King Draghi prepares to stand at the podium, stick out his arm, and in Caesar-style fashion will dictate the fate of global markets with a thumbs up or thumbs down. It is embarrassing to see what the markets have become. Well, what say you sire? Your trading subjects will react to your spoken word. Before the news, the S&P futures are flat, Dow +10, Nasdaq -2, euro 1.3504, dollar/yen 98.67, pound 1.6065, 10-year yield 2.63%, WTIC oil 95.06, gold 1315, silver 21.79, copper flat.

Note Added 7:47 AM:  Big surprise. Draghi brings the tablets down from on high and announces a rate cut to 0.25%. The euro drops to 1.3375. The 10-year yield drops to 2.61%. Futures are popping higher on the news inconsistent with the remarks above with the euro dropping and dollar popping. S&P's +6. Dow +60. Nasdaq +7. The ECB's version of free and easy money is causing U.S. traders to become excited and bullish. The analysts and traders did not expect the move. The market move is somewhat tame across the board, so far. Commodities are a touch weaker, gold is dead flat, but futures bounce. Draghi is a sly fox. The 10-year is now non-reactive at 2.63%. All eyes will now focus on the press conference and the U.S. data in about one-half hour.

Note Added 8:39 AM:  Draghi says that Europe may experience prolonged low inflation. Monetary policy will remain accomodative with low or even lower rates for as long as needed. Draghi is speaking very dovishly and the euro falls through 1.33. The dollar pop sends commodities lower with oil, gold and copper all lower. The futures, however, remain elevated. This behavior continues to illustrate how the central bankers are in full control of the stock market and ignore fundamentals. The Fed beating the dollar with QE, or BOJ weakening the yen, or ECB blasting the euro lower; all are great in trader's eyes since easy money will pump equities higher. The race to debase heats up again. The GDP is much stronger than expected at 2.8%. S&P's +6.5. Dow +74.  Nasdaq +6.8. 10-year yield 2.63%.