Keybot the Quant is short to start the new trading week. Watch the SPX:VIX ratio 68 level, now only four pennies above favoring bulls by a hair. If the ratio stays above 68 and moves higher the market bulls will be running. If 68 fails, a huge market down day is on tap with the Dow Industrials likely to fall triple digits. China lowered the triple R's, this serves as stimulus, so the bulls may be in charge.
Continue watching XLF 15.18, VIX 18.14, both bearish, and RTH 41.35, bullish. Any change in posture from any of these will thrust the broad market in that direction. The retail sector is pivotal this week with sales data and earnings from HD, WMT and TGT, as well as many others, which will directly impact RTH.
For the SPX for Monday, the bulls need to touch the 1366 handle and the market upside will accelerate. Bears need to push under 1349 to accelerate the downside. A move thru 1350-1364 is sideways action. Markets remain highly unstable. The tug-o-war by SPX:VIX above and below 68 eight times in last week's trading, verifies the ongoing bull-bear struggle. If the China cut rallies the bull troops, and either XLF or VIX join the bull camp, Keybot would be very close to moving to the long side. Keybot prints only one pre-scheduled number this week on Wednesday morning.
5/20/12; 7:00 PM EST =
5/16/12; 9:00 AM EST =
5/13/12; 7:00 PM EST = +0; signal line +16
5/11/12; 10:00 AM EST = +0; signal line +17
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