STOCK MARKET BEARISH -- SHORT -- CAUTION

Keybot the Quant is in the bear camp to begin the new year. The market sogginess is caused by higher volatility and lower chips and utilities. For the first trading week of the year, the bull-bear lines in the sand that dictate stock market direction are UTIL 719.63, UTIL 726.63, VIX 10.43 and SOX 1255.55. US markets are closed today for New Year's but resume trading Tuesday morning.

The market bears have the downside on a silver platter; if they want it. UTIL begins the week at 723.37 and if price drops below 719.63, the stock market will likely go into a mini free fall.

The market bulls need UTIL above 726.63 to prove that stocks will continue rallying higher. The bulls also need SOX above 1255.55 (now at 1253.05) and VIX below 10.43 (now at 11.04) which will create stock market strength.

The stock market will remain weak if SOX stays below 1255.55 and VIX above 10.43. One thing you can watch is the VIX 200-day MA at 10.96. This will be an immediate tell on stock market direction. If the VIX remains above 10.96, the stock market is going to trend lower. If the VIX slips below 10.96, the bulls are fighting back and will keep the stock market buoyant and elevated.

If either UTIL moves above 726.63, or SOX above 1255.55 or VIX below 10.43, any one will do, consider the imminent turn to the upside in play. If 2 of the 3 parameters turn bullish, and the SPX moves above 2692, Keybot will likely flip to the long side. On Tuesday (tomorrow), we will see what the bears got. Keybot prints a pre-scheduled number on Friday morning.

The Keybot the Quant algorithm is zeroed for the new year. Last year was disappointing with the algo model up +2.1% and the actual trading up +1.3%. The benchmark S&P 500 jumped +19.4% last year. The trades in 2017 are listed below. The algo flipped 36 times in 2017 as compared to only 26 times in 2016 which verifies the choppy whipsaw action. The sawtooth price action in the stock indexes and low volatility wreaks havoc on the algorithms. The S&P 500 begins 2018 at 2674. The beat goes on.

1/14/18; 7:00 PM EST =

1/7/18; 7:00 PM EST =

1/5/18; 9:00 AM EST =

1/1/18; Begin 2018 Data Set = +54; signal line is +78; go short 2674; (Benchmark SPX for 2018 = 0%)(Keybot algo this trade = 0%; Keybot algo for 2018 = 0%)(Actual results this trade = 0%; Actual results for 2018 = 0%)

Keybot the Quant Begins 2018 on the Short Side from SPX 2674. All Data 0%. Begin 2018.

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START 2018 PROGRAM

Begin Printing

Mark and Set

Date Stamp 1/1/18; 3:11 AM EST

START 2018 PROGRAM

Copyright Enforced. 2008. 2009. 2010. 2011. 2012. 2013. 2014. 2015. 2016. 2017. 2018. Keybot the Quant. The Keystone Speculator. K E Stone. All Rights Reserved.

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END OF 2017 RESULTS:

SPX Benchmark Final 2017:  +19.4% Gain (SPX Started at 2239 and Ended at 2674)

Keybot the Quant Actual Trading +1.3% Underperforms SPX Benchmark

Keybot the Quant has never printed a negative year

Keybot the Quant is a long-short algorithm that oscillates between a bullish (long) position and a bearish (short) position seeking the smoothest path through the trading year

Number of Position Changes (Long to Short or Short to Long) During 2017:  36

Number of Broker Commissions Required During 2017:  72

Benchmark SPX During 2017:  +19.4% Gain

Keybot the Quant Algorithm (Computer Program Only) During 2017: +2.1%

Keybot the Quant Actual Trading Return for 2017 Including All Commissions, Costs and Fees:  +1.3% Return

1/1/2017	2239	Cover short	3:59 AM	SDS	15.11
1/1/2017	2239	Go Short	3:59 AM	SDS	15.11
1/6/2017	2280	Cover short	12:33 PM	SDS	14.57
1/6/2017	2280	Go long	12:33 PM	SSO	78.86
1/23/2017	2263	Sell Long	10:32 AM	SSO	77.61
1/23/2017	2263	Go Short	10:32 AM	TWM	24.07
1/24/2017	2272	Cover short	11:40 AM	TWM	23.69
1/24/2017	2272	Go long	11:40 AM	SPY	226.82
1/30/2017	2282	Sell Long	9:35 AM	SPY	227.87
1/30/2017	2282	Go Short	9:35 AM	SH	35.85
2/9/2017	2293	Cover short	11:15 AM	SH	35.66
2/9/2017	2293	Go long	11:15 AM	SPY	229.10
3/3/2017	2379	Sell Long	9:59 AM	SPY	238.09
3/3/2017	2379	Go Short	9:59 AM	SDS	13.30
3/28/2017	2361	Cover short	3:57 PM	SDS	13.49
3/28/2017	2361	Go long	3:57 PM	SSO	84.63
3/31/2017	2367	Sell Long	10:17 AM	SSO	85.10
3/31/2017	2367	Go Short	10:17 AM	SDS	13.41
4/5/2017	2369	Cover short	9:43 AM	SDS	13.38
4/5/2017	2369	Go long	9:43 AM	SSO	85.37
4/5/2017	2357	Sell Long	3:28 PM	SSO	84.38
4/5/2017	2357	Go Short	3:28 PM	SH	34.62
4/6/2017	2363	Cover short	1:29 PM	SH	34.48
4/6/2017	2363	Go long	1:29 PM	SPY	235.84
4/7/2017	2358	Sell Long	10:36 AM	SPY	235.46
4/7/2017	2358	Go Short	10:36 AM	PSQ	42.33
4/24/2017	2376	Cover short	3:07 PM	PSQ	41.63
4/24/2017	2376	Go long	3:07 PM	DIA	207.50
5/17/2017	2376	Sell Long	9:57 AM	DIA	208.00
5/17/2017	2376	Go Short	9:57 AM	SDS	13.20
5/22/2017	2390	Cover short	9:38 AM	SDS	13.08
5/22/2017	2390	Go long	9:38 AM	SSO	86.91
6/20/2017	2442	Sell Long	12:28 PM	SSO	90.89
6/20/2017	2442	Go Short	12:28 PM	SDS	12.49
7/10/2017	2425	Cover short	9:36 AM	SDS	12.65
7/10/2017	2425	Go long	9:36 AM	SSO	89.61
8/10/2017	2455	Sell Long	10:05 AM	SSO	91.89
8/10/2017	2455	Go Short	10:05 AM	SDS	49.31
8/18/2017	2433	Cover short	12:17 PM	SDS	50.12
8/18/2017	2433	Go long	12:17 PM	SSO	90.27
8/21/2017	2426	Sell Long	9:36 AM	SSO	89.76
8/21/2017	2426	Go Short	9:36 AM	SH	33.41
8/22/2017	2452	Cover short	3:59 PM	SH	33.05
8/22/2017	2452	Go long	3:59 PM	SPY	245.33
8/29/2017	2434	Sell Long	9:44 AM	SPY	243.64
8/29/2017	2434	Go Short	9:44 AM	PSQ	39.25
8/30/2017	2452	Cover short	10:49 AM	PSQ	38.70
8/30/2017	2452	Go long	10:49 AM	DIA	218.77
9/5/2017	2469	Sell Long	9:36 AM	DIA	219.12
9/5/2017	2469	Go Short	9:36 AM	DOG	16.90
9/11/2017	2484	Cover short	11:42 AM	DOG	16.83
9/11/2017	2484	Go long	11:42 AM	IWM	140.61
9/25/2017	2494	Sell Long	10:54 AM	IWM	144.33
9/25/2017	2494	Go Short	10:54 AM	SH	32.47
9/29/2017	2511	Cover short	9:33 AM	SH	32.26
9/29/2017	2511	Go long	9:33 AM	SPY	250.42
10/19/2017	2549	Sell Long	9:52 AM	SPY	254.56
10/19/2017	2549	Go Short	9:52 AM	SDS	45.49
10/20/2017	2572	Cover short	12:23 PM	SDS	44.74
10/20/2017	2572	Go long	12:23 PM	SPY	256.70
10/25/2017	2565	Sell Long	9:49 AM	SPY	256.14
10/25/2017	2565	Go Short	9:49 AM	PSQ	37.50
10/27/2017	2576	Cover short	11:09 AM	PSQ	36.97
10/27/2017	2576	Go long	11:09 AM	DIA	233.95
11/14/2017	2568	Sell Long	10:04 AM	DIA	233.45
11/14/2017	2568	Go Short	10:04 AM	SH	31.49
11/16/2017	2589	Cover short	2:05 PM	SH	31.24
11/16/2017	2589	Go long	2:05 PM	IWM	148.16
12/5/2017	2636	Sell Long	2:23 PM	IWM	149.90
12/5/2017	2636	Go Short	2:23 PM	SDS	42.35
12/15/2017	2668	Cover short	10:16 AM	SDS	41.40
12/15/2017	2668	Go long	10:16 AM	SSO	108.79
12/29/2017	2678	Sell Long	3:56 PM	SSO	109.49
12/29/2017	2678	Go Short	3:56 PM	TWM	17.43
1/1/2018	2674	Cover short	3:00 AM	TWM	17.46
1/1/2018	2674	Go short	3:00 AM	TWM	17.46

Date – SPX – Position – Date Stamp – ETF – Price

Begin Printing Trade Data Entries Exits Reverse Order

FINAL 2017

Mark and Set

Date Stamp 1/1/18; 3:04 AM EST

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1/1/18; Algorithm Zeroed for 2018 Data = +54; signal line is +78; go short 2674; (Benchmark SPX for 2017 Final = +19.4%)(Keybot algo this trade = +0.2%; Keybot algo for 2017 Final = +2.1%)(Actual results this trade = +0.2%; Actual results for 2017 Final = +1.3%)

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