Tuesday, April 22, 2014

STOCK MARKET BULLISH -- LONG

Keybot the Quant remains long as the bulls continue an upside rally without resistance. The algo did not print any numbers in the Monday session. The bears held the line at SPX 1870-1871 all day long but in the final minutes the bulls thrust higher to 1872. Note how financials, XLF, actually finished negative. This allows bears to keep a lid on the upside. Bears need either XLF 21.77 and/or VIX 14.70 to place a ceiling on the upside and roll equities over to the downside. If both turn bearish and the SPX drops under 1863, Keybot will likely flip short but at this juncture this scenario does not appear to be in play. The caution flag will be needed if the bears push XLF under 21.77. Bulls will receive more upside juice with either RTH 58.95 and/or JJC 37.45 so the bull focus is to push the retail sector and copper higher, respectively. Bulls must have these two sectors in pocket to move to the all-time highs and then above SPX 1900.

For the SPX starting at 1872, closing at the high, the bulls only need a tiny smidge of positivity and this will set up an acceleration move higher. A move above the strong 1874 resistance is a big deal and shows the bulls in firm control heading to the all-time highs. The bears need to hold the 1872-1874 resistance level with all their might and at the same time push under 1863 to accelerate the downside. A move through 1864-1871 is sideways action. S&P futures are flat about four hours before the US opening bell.

4/25/14; 10:00 AM EST =
4/20/14; 7:00 PM EST = +47; signal line is +23

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