Keybot the Quant is long going into the Friday session. The Thursday session was calm. The algo motored along all day without printing any numbers. The bulls and bears continue to fight it out. Volatility jumped higher, the VIX now well above 16, so the bears puffed their chests and pushed markets lower. Financials and the retail sector, however, remain elevated in the bull camp. Watch VIX 15.79, XLF 15.77 and RTH 44.35. The market bulls want to push the VIX back under 15.79 to send the broad indexes higher. The market bears want to push the XLF below 15.77, or the RTH below 44.35, since either of these failures will significantly increase market selling.
For the SPX starting at 1419, the bulls need to move above 1431 to create an upside acceleration. The bears have an easier path today, only needing to push the SPX under the strong 1416 support and that will ignite a downside acceleration to test the important 1411-1413 support. A move thru 1417-1430 is sideways action. If either the RTH or XLF fails as described above, and if the SPX is under 1416 and heading lower, Keybot will likely flip short. If the XLF stays above 15.77 and the RTH stays above 44.35, Keybot will likely remain long. Markets are extremely erratic and unstable, exercise caution.
12/16/12;
7:00 PM EST =
12/12/12; 3:28 PM EST
= +17; signal line is +16
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