Friday, August 18, 2017

STOCK MARKET BULLISH -- LONG

Keybot the Quant is on the long side as of about two hours ago. The chips flip back to the bull camp so stocks remain buoyant. Chips and banks tell you everything you need to know about market direction. Watch SOX 1074.30 (now at 1076) and XLF 24.65 (now 24.67). It is a game of pennies and a couple dollars.

If both parameters remain bullish, stocks should move sideways to sideways higher into the weekend. If either parameter turns bearish, stocks will create a negative bias. If both turn bearish stocks will tumble lower into the closing bell. Easy-peasy.

8/27/17; 7:00 PM EST =
8/20/17; 7:00 PM EST =
8/18/17; 2:18 PM EST = +70; signal line is +68
8/18/17; 1:49 PM EST = +54; signal line is +69 but algorithm remains long

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant flips to the long side at SPX 2433. The stock market rallies on news that Whitehouse strategist Stephen Bannon is out. Treasury Secretary Mnuchin and National Economic Advisor Cohn, former Goldman Sachs cronies, muscle Bannon out the door. The investment bankers and Wall Street always win.

Chips, financials and commodities leap to the bull side triggering the algorithm to flip long. It came on fast. The chips, however, have already reversed. Thus, bulls need SOX above 1074.30 (now at 1073.17) to prove that a solid stock market relief rally is underway. Bears need to push XLF under 24.65 (now at 24.67) and/or GTX under 2215.70 (now at 2218.40) to prove that the downside selling in the stock market will resume. The bulls would also benefit from the VIX moving below 11.41 (now at 14.56).

Note how close the bull-bear battle is for the semiconductors, banks and commodities. Flip a coin. Markets are very erratic and unstable. A whipsaw back to the short side may occur. Watch the chips as the key signal. If SOX moves above 1074.30, the upside rally for equities is real. If SOX stays under 1074.30 the bears will prevent further upside in stocks.

On the last trade, the Keybot computer program gained +0.9% for a cumulative gain of over +4% this year thus far. The actual trading gains +1.6% on the last trade and is now up nearly +5% on the year. Remember, the actual trading was negative for the entire first half of this year. Keybot exits SDS and enters SSO remaining in 2x ETF's. The benchmark SPX is up +8.7% this year. Stay alert for a potential whipsaw. Chips, banks and commodities are controlling stock market direction currently.

8/27/17; 7:00 PM EST =
8/20/17; 7:00 PM EST =
8/18/17; 1:49 PM EST = +54; signal line is +69 but algorithm remains long
8/18/17; 12:17 PM EST = +70; signal line is +69; go long 2433; (Benchmark SPX for 2017 = +8.7%)(Keybot algo this trade = +0.9%; Keybot algo for 2017 = +4.3%)(Actual results this trade = +1.6%; Actual results for 2017 = +4.8%)
8/18/17; 11:31 AM EST = +56; signal line is +70
8/18/17; 11:25 AM EST = +40; signal line is +71
8/18/17; 10:00 AM EST = +24; signal line is +73
8/17/17; 3:54 PM EST = +23; signal line is +75
8/17/17; 3:47 PM EST = +39; signal line is +78
8/17/17; 3:39 PM EST = +55; signal line is +80
8/17/17; 3:23 PM EST = +39; signal line is +82
8/16/17; 9:00 AM EST = +55; signal line is +83
8/14/17; 11:57 AM EST = +55; signal line is +85
8/14/17; 9:36 AM EST = +69; signal line is +85
8/13/17; 7:00 PM EST = +53; signal line is +85
8/10/17; 10:07 AM EST = +53; signal line is +86
8/10/17; 10:05 AM EST = +69; signal line is +88; go short 2455; (Benchmark SPX for 2017 = +9.7%)(Keybot algo this trade = +1.2%; Keybot algo for 2017 = +3.4%)(Actual results this trade = +2.5%; Actual results for 2017 = +3.2%)

Wednesday, August 16, 2017

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains short with the algo only printing the pre-scheduled number this morning and nothing during the regular session. Volatility was high drama today. The VIX came down to kiss the 11.25-11.32 area called out by Keybot ahead of time, and the VIX bounced allowing the bears to maintain control despite a marginal move higher in the stock market.

Bulls need VIX below 11.32, GTX above 2214 and/or RTH above 80.64. Any one will create upside joy in stocks. If two of the three flip bullish, Keybot will likely flip long.

Market bears will maintain control of the stock market if all three parameters, volatility, commodities, and retail stocks, respectively, remain bearish. Bears need weaker banks and chips to take stocks lower. The bears are in control with the algo number 28 points under the signal line.

8/18/17; 10:00 AM EST =
8/16/17; 9:00 AM EST = +55; signal line is +83
8/14/17; 11:57 AM EST = +55; signal line is +85

Tuesday, August 15, 2017

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains bearish. The market bulls need lower volatility and higher commodities to prove that they can rally the stock market. Bulls need VIX below 11.32 and/or GTX above 2215. Bears need weaker chips, banks and copper to gain downside mojo. The bears are in control with the algo number 30 points under the signal line. Keybot prints a pre-scheduled number before the opening bell on hump day.

8/18/17; 10:00 AM EST =
8/16/17; 9:00 AM EST =
8/14/17; 11:57 AM EST = +55; signal line is +85

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains short as the stock market staggers sideways after Monday's big relief rally. Keybot printed another number in the Monday session but nothing so far on Tuesday. The bears are in charge with the algo number 30 points under the signal line but humorously, the stock indexes are green.

Bears will need to weaken the chips and banks to gain downside momo. The bulls need higher commodities, lower volatility and higher retail stocks to reestablish an upside rally. Bulls need GTX above 2215, VIX below 11.32 and/or RTH above 80.69. Any one of the three will guarantee further upside in the stock market and if 2 of the 3 flip bullish, Keybot will likely flip long.

8/16/17; 9:00 AM EST =
8/14/17; 11:57 AM EST = +55; signal line is +85
8/14/17; 9:36 AM EST = +69; signal line is +85

Monday, August 14, 2017

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains bearish as the bulls stage a robust relief rally. The semiconductors and banks lead the way higher. SOX pops up through the important 1076 level creating the upside thrust. The bears remain in control with the algo number 16 points below the signal line but the caution flag is out.

Bulls need stronger retail stocks and lower volatility. If RTH moves above 80.69 (now at 80.27) and/or VIX below 11.35 (now at 12.56), stocks will move strongly higher. If one of these two parameters flip bullish, consider the imminent turn to be in play and Keybot will be in position to go long. The bears need weaker chips and to push the SOX back below 1076. Weaker chips and banks will help bears while stronger retail stocks and lower volatility will help bulls.

8/20/17; 7:00 PM EST =
8/18/17; 10:00 AM EST =
8/16/17; 9:00 AM EST =
8/14/17; 9:36 AM EST = +69; signal line is +85
8/13/17; 7:00 PM EST = +53; signal line is +85

Sunday, August 13, 2017

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains short. The bears need weaker banks to prove they have the juice to send the stock market another leg lower. Bears need XLF under 24.63 (now at 24.73 only a dime above). On Friday, the financials fell to 24.67 only 4 pennies from the 24.63 called out by the algo but price bounced. XLF will tell you a lot about the stock market direction early in the new week of trading.

Market bulls are slapped around a little but not yet concerned about the tame pullback. Keybot is tracking volatility, chips and retail. Bulls need either VIX under 11.33, SOX above 1076 and/or RTH above 80.77. Any one of these three will stop all market selling and begin a relief rally. If 2 of the 3 turn bullish, Keybot may be in position to move to the long side again.

Lots of retail earnings this week will toss the RTH to and fro. Watch the chips. If SOX moves above 1076, stocks are going to begin rallying higher. Bears need to stab the banks in the heart with XLF 24.63 if they want to create serious stock market selling.

Keybot prints two pre-scheduled numbers this week one on Wednesday morning and the other on Friday morning. The bears are cruising with the algo number 32 points below the signal line.

8/20/17; 7:00 PM EST =
8/18/17; 10:00 AM EST =
8/16/17; 9:00 AM EST =
8/13/17; 7:00 PM EST = +53; signal line is +85
8/10/17; 10:07 AM EST = +53; signal line is +86

Friday, August 11, 2017

STOCK MARKET BEARISH -- SHORT

Keybot the Quant remains bearish as the stock market rebounds on Friday morning. Bears need lower commodities and banks to create market carnage, GTX under 2214 (now at 2223) and XLF under 24.64 (now at 24.83), respectively.

Bulls need higher chips and retail stocks to move the stock market higher, SOX above 1076 (now at 1063) and RTH above 80.78 (now at 79.99), respectively. Semiconductors are key. If SOX remains below 1076, the bears are going to remain in control going forward. If SOX moves above 1076, the relief rally has upside legs. The caution flag will come out if SOX moves above 1076. If commodities and banks remains bullish, and chips and retail stocks remain bearish, the stock market will stagger along sideways into the weekend.

8/13/17; 7:00 PM EST =
8/10/17; 10:07 AM EST = +53; signal line is +86

Thursday, August 10, 2017

STOCK MARKET BEARISH -- SHORT

Keybot the Quant flips to the short side shortly after the opening bell at SPX 2455. The VIX has popped above 15 now at 13.45 creating market negativity. Ditto retail stocks with RTH failing below the critical 80.82 level. Ditto chips that collapse under the important SOX 1076 bull-bear line in the sand. The semiconductor weakness creates the flush lower in stocks shortly after 10 AM.

On the last trade that went about one month, the algo program gains +1.2%. The actual trading gains +2.5% and is now up +3.2% on the year. It is nice to see a positive number since many Wall Street algorithms are struggling greatly this year due to the lack of volatility and low volume. Keybot is hanging in there. The S&P 500 benchmark is up nearly +10% this year thus far. Keybot exits SSO and enters SDS.

The bears are in control with the algo number 33 points under the signal line, however, watch out for a whipsaw move in these erratic and goofy markets. Focus on chips. The market bears will run out of gas and be unable to push the stock market lower if the SOX rises above 1076. If SOX remains under 1076 (now at 1073), the bears will continue growling and creating more negativity in the stock market. The bears finally have a turn at bat.

8/13/17; 7:00 PM EST =
8/10/17; 10:07 AM EST = +53; signal line is +86
8/10/17; 10:05 AM EST = +69; signal line is +88; go short 2455; (Benchmark SPX for 2017 = +9.7%)(Keybot algo this trade = +1.2%; Keybot algo for 2017 = +3.4%)(Actual results this trade = +2.5%; Actual results for 2017 = +3.2%)
8/10/17; 9:36 AM EST = +69; signal line is +88 but algorithm remains long
8/9/17; 3:59 PM EST = +99; signal line is +89
8/9/17; 9:36 AM EST = +85; signal line is +88 but algorithm remains long
8/8/17; 3:45 PM EST = +99; signal line is +88
8/8/17; 3:38 PM EST = +85; signal line is +87 but algorithm remains long
8/6/17; 7:00 PM EST = +99; signal line is +87
8/4/17; 10:27 AM EST = +99; signal line is +85
8/4/17; 10:07 AM EST = +83; signal line is +84 but algorithm remains long
8/4/17; 9:36 AM EST = +99; signal line is +84
8/4/17; 9:00 AM EST = +83; signal line is +82
8/3/17; 3:52 PM EST = +83; signal line is +82
8/3/17; 3:42 PM EST = +99; signal line is +81
8/3/17; 1:57 PM EST = +83; signal line is +79
8/3/17; 1:12 PM EST = +67; signal line is +78 but algorithm remains long
8/3/17; 1:07 PM EST = +83; signal line is +77
8/3/17; 12:52 PM EST = +99; signal line is +76
8/3/17; 11:52 AM EST = +83; signal line is +73
7/31/17; 7:00 PM EST EOM = +99; signal line is +71
7/30/17; 7:00 PM EST = +99; signal line is +70
7/28/17; 10:00 AM EST = +99; signal line is +68
7/25/17; 11:48 AM EST = +100; signal line is +66
7/25/17; 10:00 AM EST = +86; signal line is +64
7/25/17; 9:41 AM EST = +86; signal line is +62
7/23/17; 7:00 PM EST = +70; signal line is +59
7/20/17; 1:25 PM EST = +70; signal line is +58
7/19/17; 2:47 PM EST = +84; signal line is +57
7/19/17; 1:57 AM EST = +100; signal line is +55
7/19/17; 1:47 PM EST = +86; signal line is +53
7/19/17; 1:37 PM EST = +70; signal line is +52
7/19/17; 1:13 PM EST = +86; signal line is +52
7/19/17; 12:31 PM EST = +70; signal line is +50
7/19/17; 11:52 AM EST = +86; signal line is +49
7/19/17; 9:00 AM EST = +70; signal line is +49
7/16/17; 7:00 PM EST = +70; signal line is +48
7/14/17; 10:00 AM EST = +70; signal line is +48
7/11/17; 11:40 AM EST = +70; signal line is +48
7/11/17; 11:24 AM EST = +56; signal line is +48
7/10/17; 9:36 AM EST = +70; signal line is +48; go long 2425; (Benchmark SPX for 2017 = +8.3%)(Keybot algo this trade = +0.7%; Keybot algo for 2017 = +2.2%)(Actual results this trade = +1.3%; Actual results for 2017 = +0.7%)

Note Added 11;11 AM EST: SOX is printing at 1074.09 about 2 points below the 1076 bull-bear line in the sand called out by Keybot. Watch this closely. Bears win under SOX 1076. Bulls win above SOX 1076.

STOCK MARKET BULLISH -- LONG -- CAUTION -- TURN MAY BE IMMINENT

Keybot the Quant remains long but keeps teasing a move to the short side. Volatility is playing games with the VIX moving above and below the key 11.16 level. The algo number will drop again after the opening bell with VIX above 12 currently. Thus, if the SPX drops below 2462, Keybot will likely flip short. Yesterday, the bear's threatened to take stocks lower but they did not have enough gas and could not take out the initial lows in the session.

Market bulls need to push volatility lower and send VIX below 11.16 to resume the upside rally. Market bears will growl with VIX above 11.16 and especially above 12. The SPX 2462 level is key in the early going.

8/13/17; 7:00 PM EST =
8/9/17; 3:59 PM EST = +99; signal line is +89
8/9/17; 9:36 AM EST = +85; signal line is +88 but algorithm remains long
8/8/17; 3:45 PM EST = +99; signal line is +88