STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant flips to the short side at SPX 2678 on Friday the very last day of trading for the year, with only minutes remaining, reminiscent of the flip two years ago in the final minute of the year. You saw the VIX fail in the last minute but 3 minutes before that the chips flushed lower. The SOX dropped to the critical 1255.55 level, identified by Keybot, and then price gapped lower which sucked the broad stock indexes lower and spiked volatility. For the first week of the new year, utilities, volatility and chips are controlling stock market direction.

The VIX kept bumping it head up against the 10.43 level on Friday but did not poke up through until the very end of the session. Isn't it amazing that Keybot can call out these important levels and parameters before they occur?

Market bears will need lower utilities to drive stocks lower. Bulls will need higher utes and chips and lower volatility to send stocks higher. The parameters and levels can be identified once the algorithm is zeroed tomorrow for the new year.

The Keybot algorithm program gains a half-percent on the last trade. Ditto the actual trading. Keybot exits SSO and enters TWM. The year will close out with a disappointing finish for the Keybot the Quant algo only gaining about a percent in actual trading over the entire year under performing the SPX benchmark up over +19%.

The positive spin is that the algorithm keeps you out of trouble weaving the calmest path possible throughout any year in any trading environment. Keybot has never finished a year negative albeit this year was a close call. The price action in 2017 is the worst possible for algorithms with many investment houses pulling the plugs halfway through the year.

Even though the S&P 500 trended higher the whole year, the price action was very choppy and sawtooth. This whipsaw behavior along with low volatility kills the algorithms. The final 2017 numbers and all trades for 2017 will be posted tomorrow once the algo is zeroed for the year.

12/31/17; 7:00 PM EST EOM EOQ4 EOY2017 = +54; signal line is +78

12/29/17; 3:59 PM EST = +54; signal line is +79

12/29/17; 3:56 PM EST = +68; signal line is +80; go short 2678; (Benchmark SPX for 2017 = +19.6%)(Keybot algo this trade = +0.4%; Keybot algo for 2017 = +1.9%)(Actual results this trade = +0.6%; Actual results for 2017 = +1.1%)

12/28/17; 9:36 AM EST = +84; signal line is +80

12/27/17; 3:54 PM EST = +70; signal line is +80 but algorithm remains long

12/27/17; 2:23 PM EST = +54; signal line is +80 but algorithm remains long

12/27/17; 10:07 AM EST = +84; signal line is +81

12/27/17; 10:00 AM EST = +68; signal line is +81 but algorithm remains long

12/26/17; 2:14 PM EST = +68; signal line is +81 but algorithm remains long

12/26/17; 11:30 AM EST = +84; signal line is +81

12/26/17; 11:00 AM EST = +68; signal line is +81 but algorithm remains long

12/26/17; 10:22 AM EST = +84; signal line is +81

12/26/17; 9:39 AM EST = +68; signal line is +81 but algorithm remains long

12/24/17; 7:00 PM EST = +84; signal line is +81

12/22/17; 10:00 AM EST = +84; signal line is +80

12/21/17; 10:06 AM EST = +84; signal line is +78

12/21/17; 9:36 AM EST = +68; signal line is +78 but algorithm remains long

12/19/17; 9:00 AM EST = +84; signal line is +77

12/18/17; 3:13 PM EST = +84; signal line is +77

12/18/17; 2:16 PM EST = +100; signal line is +76

12/18/17; 1:20 PM EST = +84; signal line is +75

12/18/17; 9:36 AM EST = +100; signal line is +75

12/17/17; 7:00 PM EST = +84; signal line is +74

12/15/17; 3:48 PM EST = +84; signal line is +73

12/15/17; 1:56 PM EST = +100; signal line is +73

12/15/17; 10:16 AM EST = +84; signal line is +72; go long 2668; (Benchmark SPX for 2017 = +19.2%)(Keybot algo this trade = -1.2%; Keybot algo for 2017 = +1.5%)(Actual results this trade = -2.2%; Actual results for 2017 = +0.5%)