Ahead of the open, (13-12)

Nobody promised the conclusion of ECB, Euro leaders meetings would put a brake on the twists and turns in the market.  As aftermath..”.. (enough to stop S&P downgrades?),  leaves a lot of speculation ahead and more intraday swings” Dec. 9.  Fitch and Moody’s started the downgrade review card today. (SP looms for Tues.) * market may shrug off a negative SP note now due to market losses today, it may be positive short term market trade signal if any dip is bought.

ES began to weaken early pre-market off European bond markets selling off and the sell -off exacerbated off what was just hours prior the lead here into the trading week with semi tech giant INTC pre-announcing and cutting guidance quite severely, ”Underneath the Eurozone mess was continued unfavorable guidance continuing in tech (majority)…” Maybe, it’s a good thing SP came out of last week up 1% as no one is really paying attention yet to what damage has already been done by Europe to the real economy”.  As far as market taking cue off Europe, it’s not a case of the telegraphed, not surprising outcome of the summit that was viewed positively on Friday all off a sudden surrendering all gains off a few nights sleep after realization the implementation will take months, it’s more of traders just following the path of the peripheral euro bond market, EURO to pave the equity market direction day to day. In all, there is enough liquidity provided by ie. ECB that should contain yields from re- widening to recent alarming levels for the last 3 weeks of '11 trading.  The rest of the year doesn’t contain much in the way of meetings/ catalytic events for the Eurozone, so market will rely on Euro peripheral bond market solely. Thus, focus is either going to turn to ’12 real economy/Q4 EPS via guidance and/or will turn to US politics and debate over (unemployment benefits/tax holiday),with favorable outcome a market positive into year end.

Just like Thursday’s selling off a hawkish ECB, today’s selling wasn’t panicky either, but break of 20MA is ominous when paired with Euro and Gold selling off today. 20MA held today thanks some late dip buying, but a potential close below it in the days ahead will dampen any hope of a risk on seasonal rally and instead a sell mode effect will prevail. A nearby cross of 20ma/50ma is ominous as well.  Fears are seemingly accumulating now as INTC woke up those not “paying attention”, China export #’s.  The stress of Europe on others is beginning to show it’s hand.