Tuesday, June 27, 2017

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant remains short through the dramatic market machinations. Yesterday, the market bulls had it on a silver platter; all they needed to do was to move the S&P 500 higher slow and steady and not in a gap-up move. Comically, price jumped up in a gap-up move. The algo employs gap-up and gap-down timers so Keybot was not permitted ot go long for 87 minutes and by the time that played out equities had already retraced the bulk of the move.

Today the semiconductors fail and that is what created the downside action in equities. Chips and volatility are the two most important parameters impacting market direction currently. Bulls need SOX above 1057.51 (now at 1048.66) to prove that the upside rally can restart. Market bears need VIX above 11.59 (now at 11.06) to begin a serious drop in equities.

If the semi's recover with SOX above 1057.51, consider the imminent turn to be in play and if the SPX moves above 2440, Keybot may flip long. If VIX moves above 11.59, it is over for stocks; they will be tumbling lower. VIX begins trading at 3 AM EST.

If stocks selloff but the VIX remains below 11.59, the market bears got nothing and stocks will recover higher.

The algo number is 12 points under the signal line with the bears in charge. The battle on hump day is semiconductors versus volatility. Which will win? The winner will send the stock market in that direction. If SOX remains bearish and VIX remains bullish, stocks will stagger along sideways with a slight downward bias.

7/2/17; 7:00 PM EST EOM EOQ2 EOH1 =
6/30/17; 10:00 AM EST =
6/27/17; 3:02 PM EST = +54; signal line is +66
6/27/17; 2:33 PM EST = +70; signal line is +67 but algorithm remains short
6/27/17; 1:50 PM EST = +54; signal line is +68
6/27/17; 10:00 AM EST = +70; signal line is +68 but algorithm remains short
6/25/17; 7:00 PM EST = +70; signal line is +68 but algorithm remains short

Sunday, June 25, 2017

STOCK MARKET BEARISH -- SHORT -- CAUTION -- TURN MAY BE IMMINENT

Keybot the Quant remains short as the market drama continues. The algorithm is champing at the bit to go long with the algo number 2 points above the signal line but the internal programming rules will not yet fully latch to permit the move. If the SPX moves above 2441, Keybot will likely flip long hence the imminent turn notation is in the title line. The market bulls need a slow and steady rise in stocks rather than a gap-up move at the opening bell on Monday morning.

The market bears can begin pushing strongly lower if either copper or the banks weaken. Bears need either JJC under 29.44 (now at 29.77) and/or XLF under 23.72 (now at 23.89). Either parameter will create immediate selling in stocks. Both flipping to the bear camp will create a strong downside move in stocks. If VIX moves above 11.60, equities will be tumbling lower in earnest as a major selling event will be underway.

Keybot prints two pre-scheduled numbers this week one on Tuesday morning and the other on Friday morning. The month, second quarter and first half of the year ends on Friday, EOM, EOQ2, EOH1, respectively.

For Monday, bulls are cheering for SPX 2441 and higher to claim victory ahead. Bears are cheering for JJC under 29.44 or XLF under 23.72 which will cause stocks to sell off. Watch the copper futures trading overnight for hints and listen to any bank news in the early morning.

7/2/17; 7:00 PM EST EOM EOQ2 EOH1 =
6/30/17; 10:00 AM EST =
6/27/17; 10:00 AM EST =
6/25/17; 7:00 PM EST = +70; signal line is +68 but algorithm remains short
6/21/17; 2:41 PM EST = +70; signal line is +68 but algorithm remains short

Thursday, June 22, 2017

STOCK MARKET BEARISH -- SHORT -- CAUTION -- TURN MAY BE IMMINENT

Keybot the Quant remains on the short side but is champing at the bit to go long with the algo number 2 points above the signal line. Copper is controlling broad stock market direction. JJC 29.43 is the bull-bear line in the sand and price is at 29.47 which creates slight lift in stocks. Bulls win if JJC remains above 29.43 and if SPX moves above 2442, Keybot will likely flip long, hence the imminent turn notation in the title line. If stocks begin running higher, RTH above 81.48 will add more upside fuel.

The bears must send copper lower immediately and push JJC under 29.43 to create a downside move in the stock market. If this occurs, bears will set their sights on VIX 11.62 and if price moves above this level, the higher volatility will create stock market carnage.

So JJC 29.43 runs the entire show. As copper goes, so goes the market.

6/25/17; 7:00 PM EST =
6/21/17; 2:41 PM EST = +70; signal line is +68 but algorithm remains short
6/21/17; 2:03 PM EST = +54; signal line is +67
6/21/17; 9:41 AM EST = +70; signal line is +68 but algorithm remains short
6/20/17; 12:28 PM EST = +54; signal line is +67; go short 2442; (Benchmark SPX for 2017 = +9.1%)(Keybot algo this trade = +2.2%; Keybot algo for 2017 = +1.5%)(Actual results this trade = +4.6%; Actual results for 2017 = -0.6%)

Tuesday, June 20, 2017

STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant flips to the short side at SPX 2442 at lunchtime today. Lo and Behold! Sound the seven trumpets! After several fake-outs to the downside over the last couple weeks, the algo finally flips into the bear camp. As always, remain alert for a potential whipsaw back to the long side tomorrow.

Commodities, copper and weak retail stocks are causing the sell off in equities. Copper, retail stocks and volatility are most directly impacting stock market direction currently; watch JJC 29.41, RTH 81.50 and VIX 11.62. These three parameters determine if the bears continue to win going forward, or, if the bulls retake control.

Copper and retail stocks are in the bear camp creating market downside. Volatility is in the bull camp creating market upside. Market bears need VIX above 11.62 (now at 10.86) and stocks will begin falling apart in earnest to the downside.

Market bulls need either JJC above 29.41 (now at 29.06) and/or RTH above 81.50 (now at 80.63). Bulls got nothing unless they pump copper and/or retail stocks higher.

Thus, watch copper futures trading overnight for a hint on stock market direction tomorrow (Wednesday). Ditto volatility. The VIX begins trading at 3 AM EST. Also listen for any news on retail stocks; if it is good news that tells you the bulls will stage a comeback. If the retail news is bad that will give extra strength to bears to push stocks lower.

On the last trade, the Keybot the Quant algorithm computer program gains +2.2% and is now up +1.5% on the year. The actual trading is nearly back to flat on the year after a weak start due to the low volatility and sideways choppy stock market activity. Keybot exits SSO and enters SDS remaining in the 2x ETF's. The benchmark S&P 500 is up a huge +9.1% this year and the first half of the year is not even over.

Bears are cheering for VIX 11.62 since carnage will result. Bulls need JJC 29.41 or RTH 81.50 which will stop the stock market selling and restart the upside rally. If volatility remains bullish and copper and retail stocks bearish, the stock market will stagger along sideways with a slight downward bias. The caution flag remains out since tomorrow will be a very important day to see if the bears develop downside legs, or not.

6/25/17; 7:00 PM EST =
6/20/17; 12:28 PM EST = +54; signal line is +67; go short 2442; (Benchmark SPX for 2017 = +9.1%)(Keybot algo this trade = +2.2%; Keybot algo for 2017 = +1.5%)(Actual results this trade = +4.6%; Actual results for 2017 = -0.6%)
6/20/17; 9:36 AM EST = +54; signal line is +67 but algorithm remains long
6/19/17; 1:19 PM EST = +70; signal line is +67
6/19/17; 12:58 PM EST = +86; signal line is +67
6/19/17; 10:58 PM EST = +70; signal line is +66
6/19/17; 10:36 PM EST = +54; signal line is +66 but algorithm remains long
6/19/17; 10:07 PM EST = +70; signal line is +66
6/18/17; 7:00 PM EST = +54; signal line is +66 but algorithm remains long
6/16/17; 10:00 AM EST =+54; signal line is +67 but algorithm remains long
6/16/17; 9:00 AM EST = +54; signal line is +68 but algorithm remains long
6/15/17; 3:57 PM EST = +54; signal line is +69 but algorithm remains long
6/15/17; 12:27 PM EST = +70; signal line is +71 but algorithm remains long
6/15/17; 10:37 AM EST = +54; signal line is +71 but algorithm remains long
6/14/17; 9:36 AM EST = +70; signal line is +72 but algorithm remains long
6/13/17; 1:26 PM EST = +86; signal line is +72
6/13/17; 11:01 AM EST = +70; signal line is +71 but algorithm remains long
6/13/17; 10:11 AM EST = +86; signal line is +71
6/13/17; 9:36 AM EST = +70; signal line is +70 but algorithm remains long
6/12/17; 3:08 PM EST = +86; signal line is +71
6/12/17; 9:45 AM EST = +72; signal line is +71
6/11/17; 7:00 PM EST = +86; signal line is +72
6/8/17; 10:05 AM EST = +86; signal line is +71
6/7/17; 1:30 PM EST = +70; signal line is +71 but algorithm remains long
6/7/17; 12:53 PM EST = +54; signal line is +71 but algorithm remains long
6/7/17; 11:58 AM EST = +70; signal line is +71 but algorithm remains long
6/5/17; 3:03 PM EST = +54; signal line is +70 but algorithm remains long
6/5/17; 10:08 AM EST = +70; signal line is +69
6/4/17; 7:00 PM EST = +54; signal line is +68 but algorithm remains long
6/2/17; 9:00 AM EST = +54; signal line is +69 but algorithm remains long
5/31/17; 7:00 PM EST EOM = +54; signal line is +69 but algorithm remains long
5/30/17; 10:00 AM EST = +54; signal line is +69 but algorithm remains long
5/30/17; 9:36 AM EST = +54; signal line is +69 but algorithm remains long
5/28/17; 7:00 PM EST = +70; signal line is +69
5/26/17; 10:00 AM EST = +70; signal line is +69
5/25/17; 2:36 PM EST = +70; signal line is +69
5/25/17; 11:58 AM EST = +86; signal line is +69
5/25/17; 11:48 AM EST = +70; signal line is +68
5/25/17; 10:57 AM EST = +86; signal line is +68
5/25/17; 9:36 AM EST = +100; signal line is +68
5/24/17; 3:36 PM EST = +84; signal line is +67
5/24/17; 2:08 PM EST = +68; signal line is +66
5/24/17; 12:26 PM EST = +84; signal line is +66
5/24/17; 12:24 PM EST = +68; signal line is +65
5/24/17; 12:00 PM EST = +54; signal line is +65 but algorithm remains long
5/24/17; 11:01 AM EST = +68; signal line is +66
5/23/17; 3:09 PM EST = +84; signal line is +65
5/23/17; 2:28 PM EST = +100; signal line is +63
5/23/17; 2:16 PM EST = +84; signal line is +62
5/23/17; 9:36 AM EST = +68; signal line is +59
5/22/17; 1:18 PM EST = +84; signal line is +58
5/22/17; 9:38 AM EST = +68; signal line is +57; go long 2390; (Benchmark SPX for 2017 = +6.7%)(Keybot algo this trade = -0.6%; Keybot algo for 2017 = -0.7%)(Actual results this trade = -0.9%; Actual results for 2017 = -5.2%)

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

Keybot the Quant remains long but the algo is champing at the bit to go short. The algo number is 13 points under the signal line. The market bears have it on a silver platter if they want it. Copper and retail stocks have failed. JJC is under the critical 29.43 and RTH is under the 81.51 bull-bear line both creating stock market weakness.

If the SPX drops under 2442, and remains under heading lower, Keybot will likely flip short. The imminent turn is very much in play right now. High drama. The SPX is at 2445 and has printed a LOD so far at 2444.07. Bears need to eat some spinach like Popeye so they can push a few points lower if they want to start a stock market selloff.

If the VIX moves above 11.62, the stock market will be tumbling lower in earnest. Market bulls will restart the happy upside in stocks if JJC moves above 29.43 or if RTH moves above 81.51. The beat goes on. Do the bears finally have the oomph to flip the model short or do the bulls slap them in the face again like the last couple weeks?

6/25/17; 7:00 PM EST =
6/20/17; 9:36 AM EST = +54; signal line is +67 but algorithm remains long
6/19/17; 1:19 PM EST = +70; signal line is +67

Monday, June 19, 2017

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

Keybot the Quant remains long. The euphoric bull party continues. Keybot has been champing at the bit to go short but the parameters will not latch to allow the move, hence, the robot remains long and stocks float higher.

Retail stocks and copper are controlling stock market direction currently. Watch JJC 29.43 and RTH 81.51 as the bull-bear lines in the sand. Both are playing cat and mouse games today oscillating above and below their key levels. JJC price sits exactly on the 29.43 level that the algo calls out. Isn't that something? Obviously, as copper goes, so goes the stock market.

The RTH slips below 81.51 but it is a game of pennies. Bulls win big with RTH above 81.51 and JJC above 29.43. Bears win big with RTH below 81.51 (which it is as this is typed on Monday afternoon 2 PM EST 6/19/17) and JJC under 29.43 (this battle is in progress).

If you want markets to sell off, you need to see copper moving lower. If you are bullish, you want copper and retail stocks to move higher. The imminent turn notation remains in the title line because JJC slipping under 29.43 would place the algo in position to go short again.

6/25/17; 7:00 PM EST =
6/19/17; 1:19 PM EST = +70; signal line is +67
6/19/17; 12:58 PM EST = +86; signal line is +67
6/19/17; 10:58 PM EST = +70; signal line is +66
6/19/17; 10:36 PM EST = +54; signal line is +66 but algorithm remains long
6/19/17; 10:07 PM EST = +70; signal line is +66
6/18/17; 7:00 PM EST = +54; signal line is +66 but algorithm remains long
6/16/17; 10:00 AM EST =+54; signal line is +67 but algorithm remains long
6/16/17; 9:00 AM EST = +54; signal line is +68 but algorithm remains long
6/15/17; 3:57 PM EST = +54; signal line is +69 but algorithm remains long
6/15/17; 12:27 PM EST = +70; signal line is +71 but algorithm remains long
6/15/17; 10:37 AM EST = +54; signal line is +71 but algorithm remains long
6/14/17; 9:36 AM EST = +70; signal line is +72 but algorithm remains long

Thursday, June 15, 2017

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

Keybot the Quant remains long but is champing at the bit to go short. Copper failed yesterday but is trading marginally higher this morning. As long as JJC remains below 29.47, the softness in the stock market should continue. Bulls need JJC back above 29.47 as soon as possible.

Keybot wants to flip short but the all the parameters are not yet latching to allow the move. If the SPX drops under 2428 this morning (Thursday), the algo will likely flip short but the market bears need a slow and steady move lower not a gap-down or plunge lower that typically leads to a spike higher. Bears have it on a silver platter if they want it. The SPX dropped to yesterday's target but then bounced into the closing bell.

The market selling will seriously accelerate if VIX moves above 11.64. If stocks sell off but the VIX does not move above 11.64, the selling event will likely be short-lived and the bulls will recover.

Thus, bears win big and the model will likely flip to the short side if the SPX price moves down through 2428 heading lower. Extra juice and a downside confirmation occurs with VIX above 11.64.

Higher copper will save the market bulls. If JJC moves above 29.47, the market bulls are back on easy street with the stock market moving higher. Copper and volatility are the two main parameters controlling broad stock market direction currently. Bears win big with VIX above 11.64. Bulls win big with JJC above 29.47.

6/18/17; 7:00 PM EST =
6/16/17; 10:00 AM EST =
6/16/17; 9:00 AM EST =
6/14/17; 9:36 AM EST = +70; signal line is +72 but algorithm remains long
6/13/17; 1:26 PM EST = +86; signal line is +72

Wednesday, June 14, 2017

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

Keybot the Quant remains long as the daily market drama continues. The algo is champing at the bit to go short yesterday but the parameters would not line up to allow the move. Copper is the main parameter controlling broad stock market direction currently.

Watch JJC 29.48 the bull-bear line in the sand. Price is at 29.50 only two pennies on the bull side creating stock market lift. Bulls must send copper higher while bears need to send copper lower. If JJC drops under 29.48 and the SPX drops under 2431, Keybot will likely flip short, hence the imminent turn notation is back in the title line. Copper is down -0.3% in current trading so that would send JJC under 29.48 at the opening bell.

Volatility also remains important. Bulls can maintain buoyancy in the stock market as long as VIX remains under 11.63 now at 10.25. Stocks will collapse lower if the VIX moves above 11.63.

The big Fed decision and press conference is on tap this afternoon so there may be a wild ride in the market ahead. Watch JJC 29.48 and SPX 2431 since these two parameters will tell the market story today.

6/18/17; 7:00 PM EST =
6/16/17; 10:00 AM EST =
6/16/17; 9:00 AM EST =
6/13/17; 1:26 PM EST = +86; signal line is +72
6/13/17; 11:01 AM EST = +70; signal line is +71 but algorithm remains long
6/13/17; 10:11 AM EST = +86; signal line is +71
6/13/17; 9:36 AM EST = +70; signal line is +70 but algorithm remains long
6/12/17; 3:08 PM EST = +86; signal line is +71
6/12/17; 9:45 AM EST = +72; signal line is +71
6/11/17; 7:00 PM EST = +86; signal line is +72

Sunday, June 11, 2017

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long despite Friday's turmoil and drama. Friday's wild price action was likely due to algorithms gone mad. Price levels were triggered in the tech stocks and the selling accelerated and that money rotated into the retail and bank stocks. Keybot did not print any numbers on Friday. The bulls remain in the driver's seat.

Volatility is currently the top parameter most impacting broad stock market direction. The VIX is at 10.70. The market bears need the VIX to print above 11.64 to create substantive stock market selling. Although higher volatility will stall the market rally, the downside would be limited and Keybot will likely not flip short. Watch to see if the VIX jumps above 11.64, then after a short while comes back below 11.64, then after a short while back above 11.64, this jogging action will hint that a move to the downside for the stock market and higher volatility is at hand.

Market bears also benefit from lower copper. Bears need JJC under 29.40 and it begins the week at 30.02. A combo of lower copper and higher volatility will smack the stock market sharply lower.

Bulls will remain on easy street if the VIX remains under 11.64. Market bulls will benefit if commodities move higher. Bulls need GTX above 2267 now at 2158.

Keybot prints two pre-scheduled numbers this week on Friday one before the opening bell and one shortly after. The epic market event this week is the Federal Reserve rate decision and forecasts, and Chair Yellen press conference, on Wednesday afternoon. The market price activity may be historic.

6/18/17; 7:00 PM EST =
6/16/17; 10:00 AM EST =
6/16/17; 9:00 AM EST =
6/11/17; 7:00 PM EST = +86; signal line is +72
6/8/17; 10:05 AM EST = +86; signal line is +71

Friday, June 9, 2017

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

Keybot the Quant remains long as the market drama continues. The circus is in full swing this week with the UK election, ECB meeting and former FBI Director Comey testimony on Capitol Hill. Keybot was champing at the bit go short but all of the internal parameters would not latch so the algo remains long and the algo number is now back above the signal line. The banks rallied strong which was a direct punch to the bear's face.

Copper also rallied which was a kick in the bear's pants. The battle for market direction is most impacted currently by copper and volatility. Both are in the bull camp creating the upside and new highs in stocks. Market bears must either push JJC under 29.38 and/or VIX above 11.62 to create market selling. If JJC drops under 29.38 and the SPX drops under 2428, Keybot will likely flip short, hence the imminent turn notation remains in the title line. Copper, however, is up +1% as this is typed.

Market bulls need stronger commodities to push stocks higher. GTX above 2268 will create more upside strength in the stock market but price languishes down at 2149. Bears would benefit from lower banks, if XLF falls under 23.56, but price is at a lofty 23.84 after yesterday's rally. The beat goes on.

6/11/17; 7:00 PM EST =
6/8/17; 10:05 AM EST = +86; signal line is +71
6/7/17; 1:30 PM EST = +70; signal line is +71 but algorithm remains long
6/7/17; 12:53 PM EST = +54; signal line is +71 but algorithm remains long
6/7/17; 11:58 AM EST = +70; signal line is +71 but algorithm remains long
6/5/17; 3:03 PM EST = +54; signal line is +70 but algorithm remains long