Sunday, December 13, 2015


Keybot the Quant is bearish to begin the new week of trading. The bears took no prisoners on Friday slapping the bulls around like rag dolls. The algo number is 40 points under the signal line so the bears are cruising but in these markets things can change quickly. The VIX is elevated above 24 so the intraday and day-to-day moves in stock prices, up and down, will become larger and more violent.

An important bull-bear level for utilities this week is UTIL 542. Price is now at 551 so the bulls are going to receive a feather in their cap at the opening bell. However, the algo number will remain at -28 well under the signal line. Bears need UTIL to drop under 542 to create more broad market selling pressure.

Placing utilities to the side, Monday will be a fight between chips and retail stocks which will most greatly impact broad market direction. Watch SOX 660.90 now at 660.78 on the bear side, albeit by 12 pennies, creating market bearishness. Watch RTH 77.21 now at 77.72 in the bull camp creating upside for the stock market. Bears need RTH under 77.21 to continue downward carnage in the stock market. Bulls need SOX above 660.90 to stage a relief rally for equities. Since SOX sits directly on the bulll-bear line, semiconductors are the key to Monday. As chips go, so go the markets.

For the SPX starting at 2012, the bears need three points lower, to push under 2009 and the path to sub 2000 will occur quickly. The bulls need to retrace Friday's losses to regain their mojo, a formidable task, so instead bulls will focus on pushing semi's, retail stocks and utilities higher to try and stabilize markets. Keybot prints one pre-scheduled number this week on Wednesday morning.

12/20/15; 7:00 PM EST =
12/16/15; 9:00 AM EST =
12/13/15; 7:00 PM EST = -44; signal line is -4
12/11/15; 3:59 PM EST = -44 signal line is -2
12/11/15; 10:00 AM EST = -28; signal line is +0
12/10/15; 3:56 PM EST = -27; signal line is +2

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