Sunday, December 9, 2012

STOCK MARKET BEARISH -- SHORT -- CAUTION -- TURN APPEARS IMMINENT


Keybot the Quant is short going into the new week of trading. As mentioned in the prior post, VIX 15.82 runs the show when the opening bell rings tomorrow. Bulls will be running strongly higher if they can push the VIX under 15.82, in addition, this would provide the push that Keybot likely needs to commit to the long side.  Bears will be happy if they hold the line and prevent VIX 15.82 from failing. For the SPX starting at 1418, the bulls only need to see two points higher, to move up and over 1420, and hold it for several minutes, to ignite an upside acceleration that would likely be in concert with the VIX dropping under 15.82 and Keybot flipping long.  If the markets pop at the opening bell but the VIX does not drop under 15.82, the bulls got nothing and the markets will reverse to the downside.  The bears need to push under 1411 to create a downside market acceleration. A move thru 1412-1419 is sideways action. The broad indexes are extremely unstable, erratic and unpredictable. The action with the quant over the last couple days illustrates this indecisive behavior. VIX 15.82 will pick the winner tomorrow. Keybot does not print any pre-scheduled numbers this week so the algo will be purely at the mercy of the market action.

12/16/12; 7:00 PM EST =
12/9/12; 7:00 PM EST = +17; signal line is +9 but algorithm says stay short
12/7/12; 10:00 AM EST = +17; signal line is +8 but algorithm says stay short

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