Monday, March 6, 2017


Keybot the Quant remains short moving into the Tuesday trading day. The algo prints five numbers on Monday to begin the week. The bulls are keeping GTX above the critical 2366.87 line in the sand, however, copper is weak and when JJC opened below the critical 30.54 line in the sand, you knew the trading day would favor the bears. The weakness in copper was the key element in taking the broad stock indexes lower to begin the week.

Market bears need lower commodities, higher volatility and/or lower retail stocks to usher in more market negativity. Watch GTX 2366.87 (now at 2368.48), VIX 12.70 (now at 11.24) and RTH 78.00 (now at 78.43). Each parameter that flips bearish will cause a serious downside leg in the stock market. Market bulls must focus on pushing copper higher. If JJC moves back above 30.54 (now at 30.44), the market selling is over and stocks will rally.

For the SPX starting at 2375, the bulls need to push above 2379 and bingo, the upside will accelerate higher. If JJC moves above 30.54, the bulls will be singing, "Happy Days are Here Again." Market bears need to push the SPX under 2368 to accelerate the downside. A move through the 2369-2378 is sideways action for Tuesday.

The bears remain in control but the caution flag is out. If JJC moves above 30.54, consider the imminent turn to be in play and if the SPX would move above 2379, Keybot will likely flip long. Copper and commodities are the two key parameters most impacting stock market direction and both are impacted by the move of the US dollar index. Bears win big with GTX under 2366.87. Bulls win big with JJC above 30.54.

Watch copper futures in overnight trading since it will tell you a lot about the US stock market direction tomorrow. Copper is currently rising +0.3% to 2.666. Interestingly, and humorously, since the robots always run the show, a +0.3% gain in copper places JJC right at the critical 30.54 bull-bear line in the sand. As copper goes, so goes the markets.

3/10/17; 9:00 AM EST =
3/6/17; 1:18 PM EST = +84; signal line is +91
3/6/17; 12:54 PM EST = +70; signal line is +91
3/6/17; 12:07 PM EST = +84; signal line is +92
3/6/17; 11:44 AM EST = +70; signal line is +93
3/6/17; 9:36 AM EST = +84; signal line is +93
3/5/17; 7:00 PM EST = +100; signal line is +93 but algorithm remains shortt

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