This morning's drama results in the SPX jumping to near 1590 after the opening bell. HOD is 1589.64. VIX is 14.39 trailing lower but staying above 14 which helps the market bears. TRIN is 1.27 favoring bears today despite the up markets. The 10-year yield is at a steady 1.64%. The euro is 1.3077 weakening on Draghi's comments. The dollar/yen is 97.78. Use the 10-year yield, euro and dollar/yen numbers as pivots today. Bulls want higher yields, higher euro and higher dollar/yen. Bears want lower yields, lower euro and lower dollar/yen. Germany 10-year yield is now 1.17% testing the all-time lows at 1.16%-1.17%.
The 8 MA remains under the 34 MA on the SPX 30-minute chart as the session begins. A move through 1582-1597 is sideways action today. S/R is 1593, 1589, 1586, 1579, 1576, 1574.07 (20-day MA), 1569, 1565, 1563, 1561, 1556, 1555.55 (50-day MA), and strong support at 1552-1553. The day begins with the bulls punching up through 1586 and now attacking 1589 R. The 1593 resistance test is next if 1589 gives way. The 20-day MA and the strong floor at 1576 form a confluence at 1574-1576 so this support level may serve as both a magnet to draw price lower and an important test for the markets where a bounce or die moment will occur. The markets may idle along sideways today as trader's begin to set their sites on the Monthly Jobs Report at 8:30 AM now less than 23 hours away. Time for a walk to enjoy the beautiful summer-like day in scenic Pennsylvania.
Note Added 12:36 PM: The VIX falls through 14 and the TRIN dropped under one, thus, the broad indexes move higher. The SPX went through 1589, then 1593 R, then up to test the all-time high at 1597.57, managing to print a new all-time high and HOD today at 1597.86. The bulls are unstoppable and can taste the 1620's. The 8 MA moves up through the 34 MA signaling bullish markets for the hours and days ahead so the bulls frustrate the bears once again not allowing the bears to shine. The bears need to drop the SPX quickly, moving price under 1593 and lower, to reverse the 8/34 cross. The euro is 1.3061 moving flatish to a bit lower so this is a hair of downside pressure for the market indexes. More importantly, the dollar/yen is at 98 moving up, which means weaker yen, and higher equities. So the bulls have the BOJ to thank again for today's move which recovers yesterday's loss. The 10-year yield remains low at 1.62%-1.63% so obviously money is not rotating from bonds to stocks but instead, new fresh money, easy money from the central bankers, continues to float into the stock market. TRIN is 0.96, neutral. For such a strong up day the TRIN should be 0.7 or 0.8. VIX is 13.87 so the bulls will continue pushing markets higher. The bears will stop the upside if the VIX moves back above 14 and/or the TRIN above one. The high print today in the SPX creates a triple top over the last three and one-half days with price continuing to bump up against 1598, not yet able to print the 1598 handle. Watch VIX 14, dollar/yen 98 and SPX 1597.86.
Note Added 1:18 PM: VIX 13.78. Dollar/yen 97.98. SPX 1597.28. TRIN is 0.89 dropping lower to help the bulls.
Note Added 3:03 PM: VIX is 13.66 at lows of the day so the broad indexes are at the highs of the day. SPX prints a new all-time high and HOD at 1598.60. TRIN is 0.97, neutral, which is odd, as well as the low 10-year yield, since the TRIN should be lower and yield higher for such a bullish day. The low volatility and higher dollar/yen provides the bull fuel today, as well as the typical morning pump by the Fed. Note the dollar/yen leaking lower, now at 97.90, down from 98. The euro is 1.3055 dead flat today so the ECB does not have much affect today. The main thrust is the Fed, BOJ and weaker volatility. Crude oil is regaining the 3% loss from yesterday although copper can barely make back one-half of yesterday's drop. Semiconductors, SOX, are up +1.3% today moving above 447, providing market fuel. Utilities are lower for two days in a row. The bulls are focused on the 'increase' word in the Fed statement which hints at continued QE. Traders do not appear worried about any negativity from the Jobs Report in the morning.
Note Added 3:30 PM: VIX is at the lows today at 13.61 so this keeps the broad indexes elevated; the lower vol provides the juice. Dollar/yen is at 97.95 idling sideways. The euro idles sideways. Volume is below average today running at about 70% of a day's average expected volume so this trend of lower volume up days continues. If VIX keeps dropping below 13.60, and 13.50, and lower, the SPX will run over 1600. The VIX 50-day MA is 13.83 so pay attention to the final print today. TRIN 0.98. The 10-year yield remains stuck at 1.63%. A new all-time high is printed today at 1598.60. The all-time closing high is 1597.57 so watch this number. SPX is now printing 1597.53 only pennies away.
Note Added 3:52 PM: VIX 13.60. TRIN 1.04. SPX 1596.82.
Note Added 4:02 PM: VIX goes out at 13.59 at the lows under the 50-day MA, a big plus for market bulls. The SPX prints a new all-time closing high and new all-time intraday high today. The SPX all-time intraday high is today, 5/2/13, at 1598.60 and all-time closing high is today, 5/2/13, at 1597.59 (a new closing high by two measly pennies).
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