Sunday, February 12, 2012


Keybot the Quuant remains long to start the new week of trading. The algorithm prints the Sunday number which results in no chage. Keybot wants to go short now but it continues to be held back waiting for final confirmation signals.  Utilities and commodities battled last week to a standoff; those two sectors as well as volatility and copper will play a key role this week.

If UTIL stays below 451.17 the broad markets will weaken.  If CRB stays above 310.50 the broad markets will maintain buoyancy. If VIX stays below 26.00 the broad markets will maintain buoyancy. If JJC stays above 48 the broad markets will maintain buoyancy. Thus, bulls want to be above UTIL 451.17, CRB 310.50 and JJC 48 and below VIX 26.  Market bears want to be below UTIL 451.17, CRB 310.50 and JJC 48 and above VIX 26. Watch the SPX:VIX ratio which now signals market bearishness ahead--unless  the ratio moves up and over 68.

For the SPX for Monday, starting at 1343, the 1351 level represents bull victory, and the 1337 support level represents bear victory.  A move thru 1338-1350 is sideways action. The market bulls need to see eight points in the futures overnight to make a run to 1351.  If the 1337 support fails, which is a six point drop, a move to 1326 is probably on tap.

The Greece austerity vote passed so the euro, and commodities and equities futures, are in a happy mood to start the week, but there are many hours before the U.S. open. Ten buildings are currently burning in Greece. Keybot prints out only one pre-scheduled number this week on Thursday.  The algorithm has remained calm for the last ten tading days; perhaps this week things will heat up and the algo will become more active. Stay on guard, markets are highly unstable. A failure at CRB 310.50 would likely trigger Keybot to go short. If CRB stays above 310.50, the market bulls will likely maintain market buoyancy.

2/19/12; 7:00 PM EST =
2/16/12; 9:00 AM =
2/12/12; 7:00 PM EST = +48; signal line is +49 but algorithm says stay long
2/10/12; 10:00 AM EST = +48; signal line is +49 but algorithm says stay long

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