Thursday, September 15, 2011


Keybot the Quant is long as of yesterday so continue to watch for a potential whipsaw today. The interesting aspect was that not only did the retail sector move up and over the levels that the algo was scanning the last few days, but the utilities moved up and over a key level as well, the UTIL 427.21, as per the algo.  This adds to the bullishness and hints that a whipsaw will likely not occur today and the long side may be explored for equities for a few days.

Semiconductors led the broad markets higher over the last couple days, and yesterday the retail sector and utes further encouraged bulls.  The algo is currently indicating that this up move may be short-lived, however, simply a countertrend rally, especially since copper, commodites, financials and the higher volatility indicate further weakness ahead. But, for now, Keybot will contininue scanning and monitor how long the bulls want to run.

Watch commodities, CRB to see if the bulls want to run stronger. If CRB, now printing 334-ish, moves above 338.30, then the broad market bulls are stronger than given credit. On the bear side, watch the utes. If UTIL, now at 429.48, falls back under 427.21, that indicates the bulls are already running out of gas. Likewise, retail, RTH, now at 104.47, is bull friendly, but should it lose the 103.30-ish level, this would indicate that the bulls are already losing momentum. Barring any weakness in utes or retail, the bulls will continue to create broad market buoyancy moving forward.

For the SPX today, now at 1189, the market bulls need to get above 1202 and the upside will bust wide open with buyers entering in force taking markets much higher. If the SPX falls under 1163 in today's session, the bears will growl strongly, the upside euphoria will quickly vanish, and broad market selling will accelerate. A move thru 1164-1201 is sideways action with the markets in idle mode. Markets remain unstable and at the mercy of Euro news.

10/7/11; 10:00 AM EST =
10/2/11; 7:00 PM EST EOM =
9/30/11; 10:00 AM EST =
9/27/11; 10:00 AM EST =
9/25/11; 7:00 PM EST =
9/20/11; 9:00 AM EST =
9/18/11; 7:00 PM EST =
9/16/11; 10:00 AM EST =
9/14/11; 12:43 PM EST = -24
9/14/11; 12:39 PM EST = -40; signal line is -58; go long 1180; (Benchmark SPX for 2011=-6.2%)(Keybot this trade=+0.5%; Keybot for 2011=+26.4%)(Actual this trade via SH=+0.4%; Actual for 2011=+39.7%)

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