STOCK MARKET BULLISH -- LONG -- CAUTION

Keybot the Quant flipped long at the opening bell at SPX 1349, the upside fueled by a strong retail sector, financials and lower volatility.  Shortly thereafter, the semiconductors joined the bullish fun. Interestingly, however, the NYA came up to the 7750 and received a smack down and copper remains weak as well. Moving forward, the caution flag stays out since this rally move is an upside short-covering orgy bounce. The markets will need time to sort thru the excitement. The quant is tracking XLF right now with extreme interest. Watch XLF 14.45.  The bulls will keep the markets buoyant if they keep the XLF above 14.45, if not, markets will begin drifting lower. Also watch the SOX 375.30 level as currently identified by the algo.  Above 375.30 and markets will remain buoyant.  If the SOX falls under 375.30, the broad indexes will leak lower.

For the last trade, the algorithm program was flat, with no consequence, but the actual trading execution suffered a 3.4% loss via DXD. This is due to timing issues and the fact that the Monday drop, and today's pop, both occurred at the opening bells which taxes the ETF positions creating large gaps. Remain very cautious. Markets are unstable and erratic. This move today is a very strong candidate for a whipsaw move either today or tomorrow, or at Monday's opening bell.

7/29/12; 7:00 PM EST =

7/27/12; 10:00 AM EST =

7/26/12; 9:46 AM EST = +46; signal line is +28

7/26/12; 9:30 AM EST = +30; signal line is +28; go long 1349; (Benchmark SPX for 2012  = +7.2%)(Keybot this trade = -0.1%; Keybot for 2012 = +9.6%)(Actual this trade = -3.4%; Actual for 2012 = +5.4%)

7/24/12; 11:59 AM EST = -16; signal line is +28

7/24/12; 9:30 AM EST = +0; signal line is +30

7/23/12; 3:25 PM EST = +14; signal line is +31

7/23/12; 3:07 PM EST = +0; signal line is +31

7/23/12; 1:32 PM EST = +14; signal line is +31

7/23/12; 1:16 PM EST = +0; signal line is +30

7/23/12; 1:08 PM EST = +14; signal line is +29

7/23/12; 10:42 AM EST = +0; signal line is +28

7/23/12; 9:30 AM EST = -16; signal line is +28; go short 1348; (Benchmark SPX for 2012  = +7.2%)(Keybot this trade = +0.5%; Keybot for 2012 = +9.7%)(Actual this trade = +0.0%; Actual for 2012 = +8.8%)