The utilities climbed higher yesterday but fell a hair short of the UTIL 466.77 level (50-week MA). This is key as described in this morning's chart. Copper and commodities, JJC 45.75 and GTX 4930, respectively, are key levels to watch, as identified by Keystone's algo, and prices are comfortably above creating market bullishness. The Dow Industrials punched thru their October 2012 intraday high yesterday so this officially places the Dow on the list of five-year highs with the RUT, Trannies and mid-caps, and also hinted at more bull fun for the day ahead yesterday. Tech lagged the broad market but GOOG and IBM earnings beat last evening so this will start the Nasdaq off in a better mood today. Yesterday was another Tepper Rally day. David Tepper, a Pittsburgh-boy, from this neck of the woods, Appaloosa Management, is credited for cheer-leading the QE2 rally in late 2010. Traders were hesitant back then but when Tepper appeared on television and said do not fight the Fed and buy with both hands, the QE2 rally took off in force and was dubbed the Tepper Rally. Tepper appeared on Bloomberg yesterday and was a raging bull which supplied further bull market fuel.
It is all going the bulls way. Any negative news is ignored and important technical levels are breached as price moves higher. PKG slipped 3% yesterday and was down over 4% intraday. This is a key cardboard, packaging and shipping indicator for the economy. The SPX is chasing higher to the upper BB's on the daily and weekly charts now targeting 1500-1505. The 1496 is strong resistance and also the last remaining gap fill on the top side. All the other action when the 2007 market top rolled over is sealed properly on the way down and 1496 would complete the need for price to move higher based on gap theory alone. Keystone's SPXA150R Indicator moves to 87, between the 85 and 90 zone, which provides a strongly bearish signal. These are heights where markets typically reverse. If SPXA150R moves up thru 90 that verifies further bullishness but would also signal an uber bearish signal forward. If SPXA150R moves back below the 85 level today and tomorrow, that will signal further market selling ahead.
The BPSPX shoots higher to 79.40 at September 2012 market highs and at overbot conditions. Another indication of a market peaking but the Energizer Bunny pays no attention and motors higher. The NYMO is 51 back up to the levels of the September top, late November top, and this years top the first few days of the year. Indicators are lagging on the way up setting up negative divergence if the NYMO only squeezes out a couple more points, and says a market pull back is on tap but the bulls laugh and pour another glass of booze as the buying algo's continue clicking in. The CPC put/call ratio jumps yesterday to 0.94 which is comical since the bears simply cannot get any breaks these days. An upward spike of the CPC shows some worry entering the markets and this occurs as the broad indexes sell off, but instead, the CPC moves higher and the markets move higher as well. Today and tomorrow is a key time for markets. The VIX is flat yesterday remaining under 13. The bullish sentiment appears to be waning. The sellers are sitting on the sidelines sick of the daily beatings and the bulls may be starting to look for the red exit signs since the buying poll is becoming thin.
The daily 10-11 AM pump occurred on schedule yesterday and this sent the TRIN lower, under 0.90, to verify the market bullishness, and finished at the low at 0.78. Markets may simply idle along sideways today waiting for the all-important AAPL earnings. Analysts want to see 47.8 million iPhones so that is a key number for this afternoon. The U.K.'s Cameron surprised everyone, upstaging the high-brow crowd in Davos, by announcing the intent to offer a referendum vote on whether or not to stay in the EU. Cameron says he wants to stay in the EU but is in favor of the referendum vote to occur. More drama and confusion, which resulted in lower futures overnight, and the euro dropping under 1.33, but that was short-lived, and the bulls rallied the troops again. Futures are flat currently. For the SPX today, the bulls only need a smidge of green in the futures and an upside acceleration will occur to test the 1496 resistance and fill the last remaining gap from 2007. The bears need to push under 1481 to create a downside acceleration to 1476 in quick order. A move thru 1482-1492 is sideways action. In a nutshell, watch UTIL 466.77 and SPX S/R at 1468, 1472, 1473, 1474.51, 1476, 1481, 1485, 1486, 1489, 1496 (gap fill), 1499, 1500, 1505 and 1511. The House is scheduled to vote on extending the debt ceiling deadline which will kick the can down the road. COH missed on earnings this morning so this may impact the retail sector. MCD beats on earnings, not a blow-out, but a healthy beat, and is up one-half percent pre-market. The 10-year yield is 1.83%. Oil is flat but remains elevated. Copper is flat. The euro is 1.3345.