Monday, October 31, 2011

STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant remains long despite the sell off into the closing bell today. Copper and volatility are dancing on the fence and the direction they fall tomorrow will determine broad market direction.  On a longer term time frame, the market bears have something to smile about today since the month-end print occurred for the SPX and it finished well below the 12-month MA indicating that the broad markets remain in a secular bear market moving forward for the weeks and months ahead.

For tomorrow, since the SPX closed at the lows, the market bears only need red futures overnight, even red only by a few pennies, and this will be enough to continue the selling right where it left off at the close today, with the SPX working down to test support at 1249, 1247, 1244 and stronger support at 1242. SPX 1249 is important since the SPX failed here on 8/4/11 ushering in the waterfall sell off. Also of interest is that the SPX dropped back under the starting year number of 1257.64 turning negative on the year again.

Keeping it simple for tomorrow, watch JJC (copper) 46.80 and VIX 30.00. Closing prints are JJC 46.90 and VIX 29.96, both market bullish (copper is above 46.80 and VIX is below 30). These sectors are only providing market bullishness by pennies, the JJC only 10 cents over, and the VIX only four cents under, hence, they are dancing on the fence line tonight. If JJC loses 46.80 and/or VIX moves up and over 30, the broad markets will be selling off; controlled selling if one turns bearish, if both turn bearish, the selling will accelerate substantially and Keybot will probably flip to the short side.  If JJC stays above 46.80 and VIX stays below 30, the markets will move sideways to sideways up during Tuesday's session.

11/20/11; 7:00 PM EST =
11/17/11; 9:00 AM EST =
11/13/11; 7:00 PM EST =
11/6/11; 7:00 PM EST =
11/4/11; 9:00 AM EST =
10/31/11; 7:00 PM EST EOM = +22; signal line is -1
10/31/11; 12:42 AM EST = +22; signal line is -2
10/31/11; 12:21 AM EST = +6; signal line is -3
10/31/11; 11:27 AM EST = +22; signal line is -4
10/31/11; 10:53 AM EST = +6; signal line is -5
10/31/11; 10:42 AM EST = +22; signal line is -6
10/31/11; 9:30 AM EST = +6; signal line is -8
10/30/11; 7:00 PM EST = +36; signal line is -9
10/28/11; 10:00 AM EST = +36; signal line is -11
10/27/11; 11:59 AM EST = +36; signal line is -13
10/27/11; 9:30 AM EST = +22; signal line is -15
10/26/11; 3:59 PM EST = +6; signal line is -17
10/26/11; 3:47 PM EST = -8; signal line is -18
10/26/11; 3:31 PM EST = +6; signal line is -18
10/25/11; 10:00 AM EST = -8; signal line is -20
10/25/11; 9:30 AM EST = -8; signal line is -20
10/24/11; 10:34 AM EST = +6; signal line is -21
10/24/11; 9:30 AM EST = -8; signal line is -23; go long 1238; (Benchmark SPX for 2011=-1.6%)(Keybot this trade=-2.7%; Keybot for 2011=+26.4%)(Actual this trade via MYY=-3.8%; Actual for 2011=+36.5%)

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