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.
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