STOCK MARKET BULLISH -- LONG -- CAUTION -- TURN MAY BE IMMINENT

Keybot the Quant flips back to the long side at SPX 2878 on Thursday during the big rally. Interestingly, the quant flipped at the same 2878 level two trades ago so consider this number as an important market pivot point. The whipsaw action continues and Keybot is champing at the bit to flip back to the short side again hence the imminent turn notation in the title line. The algo number is 3 points below the signal line so the algo wants to go short again but internal programming rules will not yet permit the move.

The bulls could not get volatility low enough to guarantee more market upside so they goosed the banks and retail stocks instead. The retail stocks then rolled over in the afternoon rejoining the bears, hence, the choppy, whippy, sideways market slop continues. This action is chewing up the bulls and the bears. The robot is smart to be in the single ETF's now since the losses are along the same magnitude as the broad stock market moves.

The algo wants to flip short but likely needs to see the SPX below 2856 today. The S&P 500 begins at 2876 so that would be a 20-point drop. S&P futures are down -13 as this is typed a couple hours before the Friday opening bell for the US regular trading session. A gap-down at the opening bell will not benefit the bears; it may delay a move to the short side. Bears would benefit more from a steady gradual down move in the stock market.

The bears will immediately receive downside fuel if the banks fail. Bears need XLF below 27.00 now at 27.06. It is a game of pennies. [XLF is trading down -0.666% to 26.88 in US pre-market trading.]

The bulls need the banks to remain bullish (which does not appear to be on tap). At the same time, they need retail stocks to regain strength. Bulls need RTH above 105.63 (now at 105.22). This will tell you that the bulls will take stocks higher into the weekend. Bulls will benefit greatly, and the upside will be guaranteed, if the VIX drops below 15.06 now at 16.21. The VIX unable to drop below 15.06-15.11 yesterday told the story for today's weakness in the futures.

Thus, bears are rooting for weaker banks and retail stocks and higher volatility while the bulls are cheering for stronger banks and retail stocks and lower volatility. These are the three most important parameters impacting stock market direction today.

On the last trade, that lasted only three days, the algo program and actual trading both lose -1.7%. The benchmark S&P 500 is up +15% on the year and Keybot the Quant algorithm continues to outperform with the actual trading, generated by the quant, up +19%. Keybot exited SH and entered SPY remaining in the single, non-leveraged, ETF's, due to the whipsaw action. The stock market remains erratic and unstable. The beat goes on.

5/19/19; 7:00 PM EST =

5/17/19; 10:00 AM EST =

5/16/19; 2:11 PM EST = +38 signal line is +41 but algorithm remains long

5/16/19; 10:05 AM EST = +54; signal line is +40; go long 2878; (Benchmark SPX for 2019 = +14.8%)(Keybot algorithm program this trade = -1.7%; Keybot algo for 2019 = +8.0%)(Actual results this trade = -1.7%; Actual trading results for 2019 = +18.5%)

5/16/19; 10:01 AM EST = +54 signal line is +42 but algorithm remains short

5/16/19; 9:47 AM EST = +38 signal line is +43

5/16/19; 9:00 AM EST = +22 signal line is +45

5/14/19; 3:36 AM EST = +22 signal line is +46

5/14/19; 11:17 AM EST = +38 signal line is +47

5/14/19; 9:36 AM EST = +22 signal line is +49

5/13/19; 1:36 PM EST = +8; signal line is +51

5/13/19; 1:03 PM EST = -6; signal line is +54

5/13/19; 11:37 AM EST = +8; signal line is +57
5/13/19; 9:36 AM EST = +22; signal line is +59; go short 2831; (Benchmark SPX for 2019 = +12.9%)(Keybot algorithm program this trade = -1.6%; Keybot algo for 2019 = +9.7%)(Actual results this trade = -3.3%; Actual trading results for 2019 = +20.2%)