Sunday, September 18, 2011


Keybot the Quant is long to start the new trading week. The algo program shows the initial utes failure occurred in early August, six weeks ago, and last week the utes recovered from this failure giving market bulls something to cheer about. This is an important development since it hints at further underlying strength in the markets. The bugaboo is that the ute daily and weekly charts are forming negative divergence so this upside market fun may be short-lived. For this week, Keybot is scanning UTIL 423.83. UTIL is now at 439.29, comfortably 15 points above, thus the market bulls are running.

The financials are the next major sector that can add some further upside oomph to the markets. Watch XLF, now at 12.90, the algo wants to see 13.25, if so, the broad markets will be rockin' higher.  Copper, commodities and the high volatility remain firmly planted in the bear camp, however, and, considering a sustained potential move up in the dollar, the markets should not receive any help from this trio.  Overall, the markets are currently maintaining a sideways to sideways up bias and that will continue as long as the utes, retail and the semi's remain buoyant.

For the SPX for Monday's session, starting at 1216, if the market bulls can touch 1220, the buyers will enter in force and drive the indexes up several more handles in quick order. The market bears need to lose the 1204.50 level, about 11 points lower, to wrestle back control of the markets and usher in large block selling.

The algo clicks off one pre-scheduled number this week on Tuesday morning at 9 AM. The market bulls are in firm control and it looks like the only thing that can derail the upside bias is bad news out of Europe. The Housing Starts data is pivotal, a vital monthly number, so definitely focus your attention on the markets for Tuesday's open.

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 = -24
9/16/11; 10:00 AM EST = -24
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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