STOCK MARKET BEARISH -- SHORT -- CAUTION -- TURN MAY BE IMMINENT

Keybot the Quant remains short after a wild violent day of action. The markets are extremely erratic. The bulls had it on a silver platter and Keybot was literally seconds or at most minutes from flipping long. The algo was waiting for price to latch properly which is typically a given, and then boom; the ECB news hit the wires concerning Greece and the markets collapsed in a heart beat. All three of the previous parameters highlighted; NYA 10809, SOX 670.05 and XLF 23.86 leap back into the bear camp after leaping into the bull camp a short time before. It is rare for three key parameters to perform that type of behavior. The algo ends at where it started the day.

For Thursday, the three parameters above, and VIX 16.48, are all in play and being tracked by Keybot. All four parameters are creating market negativity. If any of the four parameters turn bullish, and the SPX moves above 2051-2054, and remains above, Keybot will likely flip to the long side. Focus on semiconductors and financials since they are ranked as the most important influences on market direction currently. Watch SOX 670.05 (price is at 669.15 so bulls need 90 cents). Watch XLF 23.86 (price is at 23.71 so bulls need 15 cents). These two will likely tell the immediate market story at the opening bell. And of course keep watching NYA 10809.

For the SPX starting at 2042, the bulls need to touch the 2055 handle and bingo, stocks will accelerate higher to 2061 in a flash. The bears need to push under 2037 which will create a downside acceleration. A move through 2038-2054 is sideways action. Markets remain very unstable. The circus will likely continue.

2/6/15; 9:00 AM EST =

2/4/15; 3:51 PM EST = +10; signal line is +21

2/4/15; 3:47 PM EST = +26; signal line is +22 but algorithm remains short

2/4/15; 3:46 PM EST = +40; signal line is +22 but algorithm remains short

2/4/15; 3:25 PM EST = +56; signal line is +23 but algorithm remains short

2/4/15; 3:22 PM EST = +40; signal line is +22 but algorithm remains short

2/4/15; 3:09 PM EST = +26; signal line is +22 but algorithm remains short

2/4/15; 1:53 PM EST = +10; signal line is +23

2/4/15; 1:33 PM EST = +24; signal line is +23 but algorithm remains short

2/4/15; 12:45 PM EST = +10; signal line is +23

2/4/15; 10:50 AM EST = +24; signal line is +23 but algorithm remains short