Monday, May 12, 2014

STOCK MARKET BULLISH -- LONG

Keybot the Quant is long and the bulls came to play today slapping the bears silly with copper and retail. JJC is far above 37.48 guaranteeing bull fuel. RTH moved above 58.68 (the algo constantly recalculates this number so the 58.68 is the key level after the opening bell today instead of the 58.78 mentioned in the prior post) creating the upside market orgy. Bulls are cruising.

The algo number is 81 signaling a market overbot condition. At its heart, the Keybot algorithm is an oscillator. This is why it can function on both sides of the tape, bull or bear. Examples of oscillators are the RSI, MACD and stochastic indicators on charts. When the oscillator climbs to +70 or +80 or higher conditions are overbot and a pull back is in order while a drop to -70 or -80 or lower is oversold conditions requiring a bounce. So there is likely more drama ahead, however, the bears got nothing unless they push RTH under 58.68.

For the SPX starting at 1897, the bulls need less than one point higher, to simply print at 1897 and higher, and an upside acceleration will catapult price above 1900 and several handles more. Since RTH 58.68 is so key to market direction, the Retail Sales number at 8:30 AM will decide the fate of markets. The data will push RTH one way or the other and the broad indexes will follow the retail sector. Watch to see if the S&P futures print any hint of green overnight, if so, SPX 1900+ is coming. The bears must keep the overnight futures negative with all their might. Bears need to push under 1880, a formidable task, so instead the bears will focus on pushing RTH under 58.68 which will stop the broad market upside. A move through 1881-1897 is sideways action for Tuesday.

5/16/14; 9:00 AM EST =
5/12/14; 12:17 PM EST = +81; signal line is +53
5/12/14; 11:42 AM EST = +65; signal line is +51
5/12/14; 10:46 AM EST = +81; signal line is +51
5/11/14; 7:00 PM EST = +65; signal line is +50

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