SPX Support, Resistance (S/R) and Moving Averages for Trading the Week of 5/6/13

SPX support, resistance (S/R), moving averages and other important levels are provided below for trading the week of 5/6/13. The bulls sound the trumpets, throw the confetti and proclaim never-ending blue skies ahead since the Fed, BOJ, ECB and BOE will money print until the cows come home.  The SPX moved above 1600 for the first time in history and the Dow Industrials moved above 15K, however, the 15K hats that were distributed for the historic event, received with cheers from the trading floor, were hidden in brief cases and back pockets by the end of the day as the Dow closed under 15K.

The SPX launches like a rocket on Friday as short-sellers, using the 1600 psychological level as their land in the sand, capitulate giving up at attempting to short this central banker-induced stock market.  This short-covering fuel, along with lower volatility, and a weaker yen, created the upside orgy.  The gap up creates air between 1598 and 1613 so it is important for bulls to hold the 1613-1614 support, otherwise, a drop to 1597-1598 can occur just as fast as the gap up. Obviously, the 1618.46 and 1614.42 all-time high levels are a key focus this week.

The most important big picture support levels are 1613-1614, 1597-1598, 1576, 1563 and 1552-1553. The critical 200 EMA on the 60-minute chart is 1572.82 sloping upwards and considering last week's low, the 20-day MA at 1577.54 and strong 1576 support, a confluence is formed at 1573-1581. This serves as a key gauntlet of support for the new week of trading. Bulls remain on easy street above 1581 while bad things will happen to the markets if the 1573-1581 gauntlet fails. For Monday, with the SPX starting at 1614, the bulls need to punch up through 1618 again, and more new all-time highs several handles higher will occur in quick order.  The bears need to retrace Friday's move, a formidable task, but not impossible, especially considering that 1598-1613 is all air; a move under the 1597-1598 support will accelerate the SPX downwards to 1593 in a heartbeat. A move through 1599-1617 is sideways action.

·         1618.46 Friday HOD

·         1618 (5/3/13 All-Time Intraday High: 1618.46) (5/3/13 Intraday HOD for 2013: 1618.46) (Previous Week’s High: 1618.46)

·         1617

·         1616

·         1615

·         1614.42 Friday Close – Monday Starts Here

·         1614 (5/3/13 All-Time Closing High: 1614.42) (5/3/13 Closing High for 2013: 1614.42)

·         1613

·         1600

·         1599

·         1598

·         1597.60 Friday LOD

·         1597 (May begins at 1597.57)

·         1593

·         1589

·         1587.34 (10-day MA)

·         1586

·         1583

·         1581 (Previous Week’s Low:  1581.28)

·         1579

·         1577.54 (20-day MA)

·         1576 (10/11/07 Intraday High: 1576.09)

·         1572.82 (200 EMA on 60-Minute Chart a Keystone Market Turn Signal)

·         1569

·         1565 (10/9/07 Market Top: 1565.15)

·         1564

·         1563

·         1561

·         1557.96 (50-day MA)

·         1556

·         1553 (10/31/07 Top: 1552.76) (3/24/00 Top: 1552.87)

·         1552

·         1551

·         1548

·         1546

·         1544

·         1539

·         1536

·         1531

·         1528 (3/24/00 Closing Top: 1527.46)

·         1525

·         1524 (12/11/07 Top: 1523.57)

·         1523.84 (20-week MA)

·         1521

·         1520

·         1518

·         1516

·         1515.77 (100-day MA)

·         1514

·         1512

·         1509

·         1505

·         1503

·         1500

·         1498 (12/26/07 Top: 1498.85)

·         1495

·         1489.57 (10-month MA)

·         1489

·         1485

·         1482.90 (150-day MA; the Slope is a Keystone Cyclical Signal)

·         1481

·         1476

·         1475 (9/14/12 Intraday HOD for 2012: 1474.51)

·         1472

·         1469.77 (12-month MA; a Keystone Cyclical Signal) (the cliff)

·         1468

·         1466 (9/14/12 Closing High for 2012: 1465.77)

·         1465

·         1464.15 (200-day MA)

·         1461

·         1460

·         1457

·         1456

·         1453

·         1447

·         1446

·         1445.62 (50-week MA)

·         1444

·         1441

·         1440 (5/19/08 Intraday HOD for 2008: 1440.24)

·         1438 (9/13/12 Fed Announces QE3 Infinity)

·         1435

·         1433

·         1431

·         1430 (12/12/12 Fed Announces QE4 Infinity and Beyond)

·         1429 (11/6/12 President Obama Election Top)

·         1427 (5/19/08 Closing High for 2008: 1426.63) (2013 Begins at 1426.19)

·         1424

·         1422

Keystone's Trading Week in Review and Path Ahead 5/4/13

On Friday, 4/26/13, BOJ maintains the pledge for stimulus but data shows the deflation continues.  The yen actually strengthens on the news, so the dollar/yen drops to 98.64 from well over 99 yesterday and equity futures move lower. Analysts are now questioning if the dollar/yen will reach the psychological 100 level. The Nikkei is up an obscene 35% this year purely due to money-printing. The Japanese banks and auto manufacturers benefit from the weaker yen created by ‘Abenomics’. Spain protests flare-up with rioters clashing with police over the austerity and 27% unemployment rate.  Portugal protests heat up as well. Two million households in Spain have no one in the family working.  Protestors are now targeting individual politicians and others perceived to have created the current fiscal mess; a new and troubling twist in the debt saga.  All politicians, bankers and other power brokers around the globe are watching this new societal development with grave concern. Perhaps pitchfork and torch stores will open up on city street corners. The general public is up in arms since the bankers that created all the economic problems were bailed out and are now wealthier than ever, and the too-big-to-fail banks are larger than ever, while individual citizens are struggling each day mired in unemployment with taxes and other expenses increasing daily. The ECB says the bond-buying program may not be needed going forward since yields have calmed.  The BOJ easy money is finding its way to European bonds causing the drop in yields so the reason for calmer yields is not due to a recovering Europe, but rather more central banker intervention in markets continuing to distort price discovery. About 4% of Cyprus’s money deposited in banks was pulled over the last month, perhaps a bit under what would be expected since money is no longer truly safe in banks.  Of great interest is that the other European nations do not show significant outflows from bank deposits so folks do not appear worried about losing money when a bailout occurs. Go figure. Gucci reports the weakest sales in three years indicating that the wealthy continue to cut back on spending.  Merkel softens the rhetoric from the Bundesbank comments yesterday.   The initial read on Q1 GDP is 2.5%, weaker than the expected 3.2%. The markets open and sell off. The Consumer Sentiment is in line with estimates but markets sell off further with the SPX at 1578 at lunch time. Volatility moves strongly higher signaling trouble for markets but then trails off lower into the closing bell allowing the broad indexes to recover. The flat day ends with the SPX at 1582 failing to print all-time highs this week.  The Dow closes at 14713. For the week, the SPX is up 1.7%, the Dow up +1.1%, the Nasdaq up +2.3% and RUT up +2.5%.  Tech and small caps led higher which is a plus for the bulls.  Semiconductor’s are up 4.4% this week.  The parabolic move in utilities continues as traders use the Fed and BOJ easy money to fuel new asset bubbles in dividend stocks, utes, REIT’s, high-yield instruments, healthcare and other perceived safe havens.  Congress passes stop-gap measures to remedy the airport problems caused by the sequester cuts; of course just in time for themselves to fly home for a short recess.

---------------------------------------------------------------

On Sunday, 4/28/13, as Letta is sworn-in as the new Italy leader that will try to form a new government, two police officers are shot at the event. The targeted attacks on individuals that created the global economic mess are increasing, as also evidenced in Spain last week.

On Monday, 4/29/13, Japan markets are closed today. The dollar/yen drops under 98. Greece passes a bill eliminating jobs so this troubled nation can receive more European aid to handle debt. Greek protestors take to the streets and riot on the news.  Euro-area sentiment Is weaker than expected.  The Italy 10-year yield drops under 4%, a 2-1/2 year low, showing a continued perceived calmness in Europe.  The European indexes and futures are higher this morning as traders expect more stimulus talk from the Fed and ECB this week.  Personal Income and Outlays shows incomes rising at a slower rate but consumption and spending is up.  Folks are not receiving raises at their jobs, their wages are stagnant, and others are working under the table now, so income is lackluster.  The Dallas Fed Manufacturing data is very weak completely falling out of bed but the equity markets ignore the bad news since it only means that the Fed and BOJ will pump more easy money.  Markets run higher into the afternoon with the SPX printing a new all-time closing high at 1593.61. The Nasdaq prints new 12-year highs at 3290.  The broad indexes start the week strongly anticipating more central banker easy money. After the bell, MAS, a bellwether for the housing sector misses on bottom and top line earnings.

On Tuesday, 4/30/13, EOM today. Italy’s Letta says the situation remains difficult and warned people to not expect too much, obviously trying to lower the already lofty expectations. Euro-area unemployment is 12.1% continuing to rise. Germany unemployment increases.  Europe, however, is in the central banker mode of bad news is good news since the ECB will likely cut rates this week and start the printing presses which will send equities higher regardless of bad news. The broad indexes are flat to lower to begin the day. Chicago PMI is much worse than expected at 49, a reading under 50, comparable to the readings from 2009.  Consumer Confidence is better than expected.  Markets see-saw up and down with the VIX moving above 14 creating market selling but by 11 AM, volatility collapses lower again and equities move higher. The FOMC two-day meeting begins. The 10-year yield drops to 1.64% but recovers to 1.68% as equities recover.  The major indexes move higher into the closing bell and the SPX prints new all-time closing and intraday highs at 1597.57.  AAPL conducts the largest bond offering ever which is well received and creates an optimistic bullish market vibe. April finishes as an up month for the Dow, SPX and Nasdaq, however, the Trannies, Cyclicals and the RUT (small cap stocks) log down months. The NYMO McClellan Oscillator chart signals a significant market top in place.

On Wednesday, 5/1/13, Australia manufacturing data is at multi-year lows since there is less need for commodities in a slowing global economy. China’s PMI manufacturing data is weaker than expected indicating a continued slowdown. Copper, oil, steel, iron ore and other commodities sell off. Today is International Labor Day and May Day protests occur across Europe.  European markets are closed for the holiday. Moody’s downgrades Slovenia to junk status.  The ADP Jobs Report is far weaker than expected and sends the futures markets lower (ADP is used as an early read for the Friday Jobs Report).  MRK and MA earnings disappoint.  The broad indexes are weak after the opening bell. Volatility jumps higher with the VIX over 14.  Copper collapses -3.3%.  Oil collapses -3.1% as crude oil supplies are at the highest levels ever verifying a slowing global economy. Airlines are happy about the lower fuel costs. ISM Mfg Index is 50.7 above the 50% expansion-contraction level but below last month’s number. Construction Spending is weak.  Markets pivot lower on the negative news this morning. Keystone’s 30-minute chart shows the 8 MA stabbing down through the 34 MA signaling bearish markets for the hours and days ahead. The FOMC Meeting Announcement provides something for everyone.  The wording ‘increase or reduce’ is added in reference to QE so instead of talk of tapering, an increase in QE is placed on the table. This is due to the deflationary conditions occurring as highlighted by Keystone’s Inflation-Deflation Indicator that has signaled deflation starting in March.  The committee says ‘downside risks remain’. The bulls wave the ‘increase’ word and the bears wave the ‘reduce’ word and markets move flat. Chairman Bernanke stressed the importance of Congress to become more involved. He is likely concerned, as he should be that the Fed may be creating a fiscal drag and hurting the economy more than helping. The Fed is worried about deflation. Many analysts have now reduced their GDP forecasts for H2 2013 down to 1.0 to 1.5%. As the afternoon plays out the markets roll over to the downside with the SPX closing in the low 1580’s.  

On Thursday, 5/2/13, the HSBC China PMI confirms the weak manufacturing data as reported by the official number yesterday. Global giant Siemens cuts guidance moving forward. BMW’s profits drop. Swiss banks are logging strong profits. Germany’s DAX is back above 7900. France’s 10-year auction results in a record low yield at 1.81%. Italy’s 2-year yield drops to 1.07%, a record low, as the BOJ easy money continues to buy European bonds and U.S. stocks. The ECB Rate Decision results in a one-quarter point rate cut to 0.50% as expected.  The markets take the news in stride with global indexes and futures remaining flat.  In the press conference, however, Draghi comments about potential negative deposit rates where banks would have to pay the ECB for holding euro deposits (the ECB is trying to encourage banks to lend money out rather than hold it at the central bank). The euro drops on these comments. Jobless Claims are at the lowest in five years pumping life into the futures markets turning a gloomy bear day to a happy bull day. Companies may not be hiring anyone but they do not appear to be laying off anyone either. Markets rally all day long recovering Wednesday’s losses. Oil recovers the 3% loss from yesterday with WTIC printing at 94.  Copper recovers half its losses from the prior day. Volatility collapses, with the VIX falling under 14, creating upside fuel for the broad indexes. Keystone’s 30-minute chart shows the 8 MA moving up through the 34 MA signaling bullish markets for the hours and days ahead. The SPX prints a new all-time high at 1598.60 and a new all-time closing high at 1597.59. Traders are very optimistic ahead of the Jobs Report in the morning. After the bell, AIG and LNKD earnings beat but LNKD reduces guidance and the stock is sold off over 10%.

On Friday, 5/3/13, India cuts rates one-quarter point to 7.25% but trader’s wanted more; the Bombay Sensex drops -0.6%. Italy’s 2-year note yield drops under 1% for the first time ever.  Spain 10-year yield falls under 4% (last seen October 2010). The BOJ’s easy money continues buying European bonds. ECB’s Nowotny plays down the negative interest rate talk from yesterday and says “markets over-interpreted Draghi’s comments on negative deposit rates. This would have to be analyzed closely and is not relevant for the immediate future.”  The euro jumps from 1.3060 to over 1.3120. The EU cuts the Eurozone economic growth forecast. U.K.’s RBS bank sells off as it loses customers due to the weak European economy. The dollar, USD, drops under 82.  The government is investigating JPM for questionable energy trading practices.  IBM is also under investigation on bribery charges. The Monthly Jobs Report is 165K jobs and 7.5% unemployment rate, better than the 145K and 7.6% consensus. The prior month’s revisions cause the futures markets to sky rocket higher. The March number is revised up from the paltry 88K to 138K and February from 268K to 332K, a multi-year high.  Average earnings are up 0.2% (flat last month) but hours worked are 34.4 down from last month. So folks may be paid a wee bit more per hour but they are working less hours, so the actual take home pay is lower.  Less hours worked is not a hopeful sign despite all the euphoria. The labor participation rate remains flat and weak at 63.3% with many folks giving up looking for work. The ADP Jobs Report loses its luster as a prediction tool. The S&P futures are +13, the Dow Industrials are +130 and Nasdaq is +23.  The SPX is now set to print new all-time highs and easily cruise above 1600 for the first time ever. Copper is up strongly, +6%, with its best day in one and one-half years. The bulls have everything going their way. Good news is good news and bad news is good news.  Any negative earnings or economic data are viewed as positive since the Fed and BOJ will only pump markets higher due to the weak data. The broad indexes soar higher at the opening bell.  The SPX prints above 1600 for the first time in history in the opening minute and runs 20 handles higher to 1618.46, a new all-time high.  At 10:20 AM, the Dow Industrials print above 15K for the first time in history running over 170 handles higher to 15009.59, a new all-time high. Ralph Acampora, noted stock analyst, says the Dow will reach 20K within four years. Jeremy Siegel, noted professor, who made the bold Dow 16K call recently for the end of this year, repeats his bullishness on television. Short-sellers capitulate adding more upside fuel. Volume remains below average for the market up days. The broad indexes float higher into the close but the Dow is unable to close above 15K. The SPX prints a new all-time closing high at 1614.42 and new all-time high at 1618.46.  The Dow prints a new all-time closing high at 14973.96 and new all-time high at 15009.59. The Nasdaq prints a new 12-½ year high at 3388.12. RUT prints a new all-time high at 959.55. Crude oil jumps strongly the last couple days closing at 95.61. Look for the gasoline price at the pump to move higher again. Gold is 1470 recovering from its drubbing last week. The 10-year Treasury yield moves from 1.63% this morning to close at 1.75% showing that money is leaving the bond market and moving into stocks. The parabolic utilities sector, pumped by the Fed’s easy money is actually down today. Traders are rotating into tech and industrials sectors, tripping over each other to buy the XLI which was up over 2% today before closing up 1.7%. The recent negative manufacturing and other economic data shows a slowdown ahead but traders are buying steel, coal, and industrials with both hands. The trading session is one large euphoric bull party. Despite the bullishness, the NYMO McClellan Oscillator chart signals a significant market top in place. The SPXA150R chart hits the 90 level signaling time to short the market. Market complacency continues as evidenced by the low VIX (now under 13) and CPC put/call ratio.

--------------------------------------------------------------

On Monday, 5/6/13, China and Japan PMI Composites. Flash Crash 3-Year Anniversary.

On Tuesday, 5/7/13, 3-Year Note Auction. Consumer Credit.

On Wednesday, 5/8/13, 10-Year Note Auction.

On Thursday, 5/9/13, Jobless Claims. Wholesale Trade. 30-Year Bond Auction.

On Friday, 5/10/13, Treasury Budget. Chairman Bernanke speaks. G8 Meeting begins.

--------------------------------------------------------------

On Monday, 5/13/13, Retail Sales. Business Inventories.

On Tuesday, 5/14/13, Import and Export Prices.

On Wednesday, 5/15/13, PPI.  Industrial Production.

On Thursday, 5/16/13, Jobless Claims, CPI and Housing Starts. Philly Fed.

On Friday, 5/17/13, Consumer Sentiment. Leading Indicators.

---------------------------------------------------------------

On Wednesday, 5/22/13, Existing Home Sales. FOMC Meeting Minutes.

On Thursday, 5/23/13, Jobless Claims, PMI Mfg Index. New Home Sales. 10-Year TIPS Auciton.

On Friday, 5/24/13, Durable Goods Orders.

--------------------------------------------------------------

On Monday, 5/27/13, U.S. Markets are Closed in Observance of Memorial Day.

On Tuesday, 5/28/13, U.S. Markets Open for Trading.  Consumer Confidence. 2-Year Note Auction. The 16.4 trillion Debt Ceiling limit is hit, however, the government is taking in more revenue than expected, the sequester cuts are in place, and Congress is developing a plan to extend the Debt Ceiling deadline to August or September, so this can will likely be kicked about three months into the future. The politicians are trying to line up all the problems, debt ceiling, fiscal cliff, and CR resolution to fund the government, for a combined August-September deadline thus providing this summer as the time to conduct a knock-down drag out political fight to set the U.S. on the correct fiscal path forward. This political behavior is similar to the summer of 2011 which did not receive a happy ending.

On Wednesday, 5/29/13, 5-Year Note Auction.

On Thursday, 5/30/13, Jobless Claims, GDP. 7-Year Note Auction.

On Friday, 5/31/13, EOM. Personal Income and Outlays. Chicago PMI. Consumer Sentiment.  Farm Prices.

----------------------------------------------------------------

On Monday, 6/3/13, PMI Mfg Index. ISM Mfg Index. Construction Spending.

On Tuesday, 6/4/13, International Trade.

On Wednesday, 6/5/13, ADP Employment Report. Productivity and Costs. Factory Orders. ISM Non-Mfg Index. Beige Book.

On Thursday, 6/6/13, Jobless Claims.

On Friday, 6/7/13, Monthly Jobs Report.

---------------------------------------------------------------

In September, Merkel (Germany) seeks re-election and will not want to see Greece or other nations exit the euro before the election but will not care afterwards. Perhaps Greece and others, or Germany, may exit the euro in the future.

In Q4 2013, European bank stress tests will occur.

On Friday, 1/31/14, Chairman Bernanke’s term ends at the Fed, unless there is news during Q4 2013 that he will stay on. Will Yellen, even more dovish and likely wanting to see QE on steroids, take the reins?

In March 2014, the ESM is officially “fully operational.” The banking union schedule has been delayed from January 2013 to January 2014 and now to March 2014.

NYMO McClellan Oscillator Signals Significant Market Top

Here we go again. Like Led Zeppelin says, 'the song remains the same'. We watched the NYMO chart a few days ago, and a few days before that as well.  Is the third time a charm?  Note the three tops in a row currently printing, each signaling a significant market top, but the central bankers will not allow markets to correct. Perhaps it will now no longer matter what the central bankers think and do?  Friday's print is 44.68 well into the range of signaling a market top. The red circles show the market tops and green circles show market bottoms. The double circles are key reversals.  What do you think will happen?

Market bottoms occur when the NYMO drops under -40. The important mid-November bottom occurred at -90, once that hit it was a key indicator to use to feel comfortable buying the market long. Likewise the other green circles.  Market tops are signaled when NYMO moves above the +30 or +40 level, however, the tops have gotten sloppy over the last months.  Note that tops are now occurring from about +10 and higher. The central banker intervention creates distortions in all markets these days and may be the cause of tops occurring at lower NYMO levels.

Nonetheless, at +44.68, a significant market top is occurring right now.  There is very little ceiling height remaining for the NYMO. Projection is a market top in place now and a reversal in the broad indexes should occur moving forward perhaps beginning on Monday. Type 'NYMO' into the search box at the right to bring up the prior NYMO charts for additional study. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

Keystone's BPSPX Indicator Market Buy Signal

Keystone's BPSPX Indicator is regularly updated on the Other Market Signals page. In a  surprising development yesterday, the bulls eek out a Market Buy Signal by one thin dime. The BPSPX signals a market buy, or sell, signal when price reverses six percentage points. In November and December, the market bottom was confirmed when the BPSPX moved from 58 to 64. From there it was off to the races for the bulls.  In March, the top occurs at 84.40 so the Market Sell Signal triggered at 78.40. The markets sold off in April but the bulls will not let the bears shine. The central banker easy money remains powerful and continues to pump equities higher. The near-term bottom a few days ago is 75.2. Thus, 75.2 + 6 = 81.20. Yesterday's print is 81.40 so a Market Buy Signal occurs.

This is not an expected development for the BPSPX. Typically, once the downside, or upside commitment is made, the markets should continue along in that fashion for a few weeks, but the bulls changed all that on Friday.  This move is very suspect and may be short-lived. However, since the signal is a market buy now, the bulls must be shown respect, and the bears cannot shine again until a six percentage-point down move occurs to 75.40 (81.40 - 6 = 75.40). This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

Keystone's SPXA150R Indicator Signals Significant Market Top

The SPXA150R is one of Keystone's Short-Term Market Signals (reference the Short-Term Signals page on this site). Price touched 90 on Friday.  The 80-85 zone signals Bearishness since traders are becoming too optimistic on the markets. The 85-90 zone is Strongly Bearish since the markets are printing at lofty levels. Above 90 is Uber Bearish since the bullish party is out-of-hand, the wine is flowing like water, and several bulls are dancing on table tops donning lamp shades, like yesterday. The 90+ level identifies all market tops including the recent tops in May and September of last year, and the top three weeks ago.  The 90 level is an all-systems go signal for shorting the market. The month of May will be interesting. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

Keystone's Midday Market Action 5/3/13; Jobs Report Rally

The bulls are running strong today with the SPX crossing up over 1600 and the Dow Industrials up over 15K to new all-time highs. The SPX HOD is 1618.46 and the Dow HOD is 15009.59 so watch these numbers closely today. VIX is at 12.87.  TRIN is 0.74 off the uber low 0.53.  Oddly, the TICK did not surpass +725 today; for this type of upside orgy you should expect to see +1000 print if not +1200.  The utilities, UTIL, are actually down today.  Tech and small caps are outperforming to the upside. Traders are moving from the utility sector bubble back into the tech sector. The XLI, industrials sector, is up over 2% today with traders also rotating into these stocks expecting a strong economic recovery despite all the weak manufacturing data.

The broad indexes pivoted upwards on the 10 AM data.  The 10-year is at 1.73% a big move from the 1.63% this morning showing that traders are favoring the risk-on trade and moving out of bonds. The SPX 1600 must have ignited animal spirits; it ignited the trading robots and caused many short-sellers to throw in the towel.  The SPX is now printing 1615.96 and the Dow is at 14984.59. Stronger commodities will help the bulls maintain an elevated stock market. JJC (copper) is up 6.5% but this is off the very low numbers after the couple month sell off. FCX, still used as a copper proxy although it is more diversified now, is up 3.6%. SCCO is up 5%.

Note Added 12:30 PM:  Dollar/yen 99.15 about one point higher from one day ago. The push to 100 may be occurring again.  Up dollar/yen means weaker yen due to BOJ easing and higher equities.  The euro is 1.3110 up and over 1.31, up euro is up markets.  The following asset relationships are falling back in sync. Weaker yen (BOJ easing) = higher dollar/yen = higher euro/dollar = lower USD dollar basket (Fed easing) = higher commodities = higher oil = higher equities = weaker bonds (higher yields).  Stronger yen (less BOJ easing) = lower dollar/yen = lower euro/dollar = higher USD dollar basket (less Fed easing) = lower commodities = lower oil = lower equities = stronger bonds (lower yields). Risk-on is higher equities and lower bonds (higher yields) while risk-off is lower equities and higher bonds (lower yields). The interesting thing about the jobs report is that 165K jobs does not even keep up with the jobs needed to handle the new entrees into the workforce (about 150K to 180K jobs). Crude oil is now 95.72 on its way to 96. VIX is 12.88.

Note Added 1:59 PM:  The broad indexes jumped this morning and stuck, moving through 1515-1518, a tight range today.  SPX is leaking down to look at the 1615 support. Despite the strong up day, the 2-hour, 1-hour and 30-minute charts are all agreeable to the SPX rolling over again. TRIN is 0.84 coming up off the bottom but remaining firmly bullish. Volume is below average running at about three-quarters of a day's average expected volume although there should be a big push into the closing bell today.  VIX is stone-cold flat at 12.87 reflecting the flat sideways range of the SPX. The 10-year yield is up to 1.75%.  The dollar/yen is 99.13, flat since a couple hours ago, reflecting flat equities. Crude oil also moving flat at 95.78. Gold is flat today at 1464. The Dow 15K level will likely generate drama into the closing bell; the newspaper headline writer's are cheerleading the push higher since 15K is a lot more exciting than a new all-time high at 14990. Note that the SPX HOD at 1618.46 and Dow HOD at 15009.59, the new all-time highs, from this morning, are holding as resistance, so far.

Note Added 2:29 PM:  The SPX support and resistance in this new uncharted territory is interesting. The robots must be trading in 50 cent and one dollar increments.  The initial jump this morning on the SPX is to 1612, then S/R moving higher is 1613, 1614, 1615, 1616, 1616.50, 1617, 1617.50, 1618 and 1618.50-ish (the all-time high is 1618.46). Price tested 1615 support one-half hour ago and it held, so far. VIX 12.84.  TRIN 0.84.

Note Added 3:24 PM:  SPX 1613.05 testing the 1613 support now.  VIX 12.96 remaining under 13 helping the bulls. TRIN is 0.84 remaining bullish today. The Dow is 14968.50 needing 32 points to receive the happy 15K weekend newspaper headline.

Note Added 3:41 PM:  SPX 1614.94 at the 1615 level. Dow is 14980 on the dot needing 20 more to approve the fireworks display for this evening. VIX 12.86 leaking lower pushing equities higher. TRIN is lower at 0.78 providing a push of bull fuel.

Note Added 3:45 PM:  Dow 14990 ten points away.

Note Added 3:57 PM:  Dow 14977 slipping.

Note Added 4:00 PM:  The juice was not there for Dow 15K; the bulls will have to wait until next week and the headline writer's scratch their heads with dull pencils wondering how they can make 14974 sound exciting. The new all-time highs from this morning held all day long. SPX new all-time high at 1618.46 and new all-time closing high at 1614.42. The numbers are continuing to settle out.

SPX 2-Hour Chart Upward-Sloping Channel Overbot Negative Divergence

New all-time highs are printed on the joyous jobs report this morning. Price is now near the top of the upward-sloping channel for the 2-hour chart.  The red lines show the negative divergence that created the mid-April pull back and now the chart is setting up in the same manner. The move up today has such momentum, however, there may be a day or three needed to absorb all that energy, so some sideways at these elevated levels may be in order. The indicators are not sharing the upside enthusiasm although the MACD line is trying to point to higher highs ahead. Stochastics and RSI are in overbot territory now. The markets continue higher but the projection is sideways to sideways lower ahead. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

Keystone's Morning Wake-Up 5/3/13; Monthly Jobs Report

The drama for the week reaches a crescendo in one hour's time when the Monthly Jobs Report hits at 8:30 AM EST.  The consensus is 145K jobs (last month, March data, was 88K) with a steady unemployment rate at 7.6%.  The revisions to last month's numbers are important. Also, watch the hours worked (34.6 last month), hourly earnings (0.0% last month) and labor participation rate (63.3% last month). Since the disappointing jobs number last month at a paltry 88K, on the bear side, companies have reported weaker sales and the sequester cuts continue to affect companies negatively. On the bullish side, Jobless Claims hit a five-year low yesterday so although companies may not be hiring, they appear to not be firing either. Factory Orders and ISM Non-Mfg data is released at 10 AM so markets will pivot on that news.

Commodities are up strongly again today wiping out Wednesday's dramatic drops. Futures are idling ahead of the jobs numbers.  The weaker volatility, with VIX dropping under 14, creates bullishness for markets as evidenced yesterday. For the SPX today starting at 1598, the bulls only need to see positive futures and the SPX will be moving up through 1600 after the opening bell today. The bears need to push under 1583 to accelerate the downside. A move through 1584-1597 is sideways action today. The 8 MA is above the 34 MA on the 30-minute chart so the bulls are clearly in charge. The 10-year yield sits at 1.63%-1.64%. The Jobs Report will tell the story.

Note Added 8:35 AM:  The Jobs Report sends the markets violently higher with the S&P futures now up +11.  There are 165K jobs with a 7.5% (lowest since December 2008) rate. Hourly earnings are up 0.2% compared to flat last month but hours worked are 34.5 lower than last month. Labor participation rate remains flat at 63.3%. The big push higher in markets is due to the revisions. Last month's paltry 88K is revised to 138K and February was revised from 268K to 332K. The 332K is a multi-year high. The 10-year yield jumps to 1.69% as money runs into equities. S&P's are now +12, the Dow +110 and Nas +23. Looks like SPX 1600 is a done deal this morning. The bulls are benefiting on good news as well as bad news.  The bad news is met with the realization that the Fed and BOJ will only increase their money printing so all news is viewed positively. Keystone's 80/20 rule says 8's lead to 2's, so it looks like the breach of 1580 should lead to the 1620's.

Note Added 8:50 AM:  S&P's +11.  Dow +106.  Nasdaq +21.  Crude oil 95.22.  The 10-year yield is now at 1.70% regaining this psychological level. Gold 1465.  Dollar/yen 99.07 (higher dollar/yen = weaker yen = higher equities). The euro is 1.3047 dropping back under 1.31.

Note Added 9:35 AM:  The broad indexes are up strongly, the whistles and horns are sounding for SPX 1600, the first time it has printed in history.  The data at 10 AM should create a pivot. The markets will need time to settle out this morning. SPX now moving towards 1614 with the shorts throwing in the towel. VIX is 12.85 under 13.  TRIN is 0.65 confirming the uber bullishness.

SPX 30-Minute Chat 8 MA and 34 MA Cross Upward-Sloping and Sideways Channels Overbot Negative Divergence

The bears keep having the rug pulled out from under them like Lucy pulling back the football just as Charlie Brown approaches to kick the ball. The 8 MA fell under the 34 MA on Wednesday signaling the all-clear for bears but yesterday, the football was pulled away once again as the 8 MA moves above the 34 MA signalling bullish markets for the hours and days ahead. The 8 MA is 1597.38 so the bears need to push the SPX under 1597 to start curling the 8 MA to the downside.  The brown lines show the ongoing sideways channel through 1576-1598 for the last two weeks. The blue lines show the upward-sloping channel in play for the last two weeks. Price is at or near the tops of both these channels increasing the drama for the imminent Jobs Report.  The red lines clearly show negative divergence across the board; the price highs are occurring with less and less oomph. Anything can happen when the jobs numbers hit but the projection is sideways to sideways down moving forward. As always, use the 8/34 cross on this chart as the bull-bear guide moving forward. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.

SPX Daily Chart New All-Time Intraday and Closing Highs Upward-Sloping Channel Potential M Top Negative Divergence

The SPX Energizer Bunny stock market continues higher fueled by the central banker rocket fuel. Traders are ignoring any negative data and earnings and solely focusing on the easy money policies. The SPX prints a new all-time intraday high at 1598.60 and new all-time closing high at 1597.59. Interestingly, the new closing high was only squeezed out by two pennies above the prior closing high at 1597.57.  The bears are frustrated since any downside move is met with the central banker buy-the-dip philosophy.  Despite the new stock market highs, the 10-year Treasury yield remains frozen at 1.63%-1.64% showing that there is no rotation from bonds to stocks but instead, Fed and BOJ easy money is pumping equities higher.

The buying volumes remain weak as new highs are printed. The stochastics are overbot. The indicators are negatively diverged wanting to see another roll over in price but the Fed and BOJ are strong forces that are dead-set on pumping markets higher. The morning market pump each day (Fed) from 10 AM-11 AM is clearly visible. So the chart says down but not only are the central bankers in play but also the Monthly Jobs Report only a couple hours away. Charts can only price in all news up to the minute so the jobs data can create a violent reaction either way today. A potential M Top formation is in play now and the next few days decides if the final down leg for the M forms, or not. The H&S pattern was negated with the higher highs yesterday, however, the current print may serve as a head for an H&S pattern moving forward. Price continues to fight to try and maintain the upward-sloping channel. Projection is sideways to sideways lower moving forward. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.