Sunday, January 8, 2012


Keybot the Quant is long to begin the new trading week but the algorithm is set up to flip short at anytime.  Monday's open offers drama since the algo number is under the signal line and if the other programming rules line up, and the futures are about four points negative, Keybot should flip to the bear side.  Watch the SPX 1273 level.  SPX begins at 1277. If the 1273 is lost to the downside, Keybot will likely flip to the short side and the markets should be falling on substantial downside pressure. Thus, SPX 1273 takes on epic significance tomorrow.

Monday's trade depends on the Merkozy meeting. If the Europe news is encouraging, the market bulls need to push the SPX higher to touch the 1282 handle, if so, the upside will rocket higher with a wild bull orgy move. A move thru 1275-1280 is sideways action. Note the tight five point range so chances are that the SPX will make a decision on which way to move and it should have a significant impact on markets. Retail is very important this week, so watch RTH closely to see if it collapses. RTH 110.25 is the key level which will cause significant harm to the broad markets.  Other key sector levels to watch are JJC 44.75, SOX 367.60, XLF 12.80, CRB 315.00 and most importantly, the SPX 12-month MA at 1280-ish.

Keybot prints only one pre-scheduled number this week on Friday morning.  Monday's open will be an exciting start if the futures are red. Caution is warranted since a turn appears imminent.

1/15/12; 7:00 PM EST =
1/13/12; 10:00 AM EST =
1/8/12; 7:00 PM EST = +6; signal line is +11 but algorithm says stay long
1/6/12; 12:40 PM EST = +6; signal line is +10 but algorithm says stay long

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