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

Keybot the Quant flips back to the long side yesterday at munch time at SPX 2798. The semiconductors were a moonshot out of the gate so the fix, and whipsaw, was in. The price action in the chips is purely machine-driven as evidenced by the minute charts moving up in a straight line. The semi's and retail stocks are the two main drivers of the stock market strength.

Bulls need stronger copper and utilities, and lower volatility, to continue the rally. Bulls need CPER above 14.87 and VIX below 29.80.

Bears need weaker chips, plain and simple. People working from home are creating the near-term demand in chips and the pop in chip-makers. Bears need SOX below 1632 to create stock market weakness. If SOX 1632 fails, and the SPX moves below 2776 trending lower, Keybot will likely whipsaw back to the short side.

For the last trade, that ran all of 8-1/2 hours, the algorithm program loses -1.6% and the actual trading loses -3.2%. Interestingly, the correlations between the 1x and 2x ETF's and their respective indexes are tracking very closely, as they should, another indication of machine-driven markets (typically, the  numbers are all over the map). The sawtooth, whipsaw, choppy stock market, choose your description, chews up bulls and bears alike. In the last nine trading days, the SPX has flipped direction six times. The benchmark S&P 500 is down -13.4% on the year. The Keybot the Quant algorithm program is up a couple percent on the year but the actual trading slips more negative down about four percent this year thus far. Keybot exits SDS and enters QQQ. The robot flips back into single 1x ETF's for the next 35 days due to the whipsaw. The choppy markets chew up the 2x ETF plays so the quant slips back into 1x ETF mode to reduce risk.

It will be interesting to see if another whipsaw occurs. Watch the semiconductors. SOX 1632 dictates stock market direction. Keybot prints a pre-scheduled number tomorrow morning.

4/26/20; 7:00 PM EST =

4/24/20; 10:00 AM EST =

4/22/20; 12:42 PM EST = -44; signal line is -51; go long 2798; (Benchmark SPX for 2020 = -13.4%)(Keybot algo this trade = -1.6%; Keybot algo for 2020 = +1.9%)(Actual trading results this trade = -3.2%; Actual trading results for 2020 = -3.9%)

4/22/20; 9:36 AM EST = -44; signal line is -51 but algorithm remains short

4/21/20; 10:56 AM EST = -60; signal line is -51; go short 2753; (Benchmark SPX for 2020 = -14.8%)(Keybot algo this trade = -3.2%; Keybot algo for 2020 = +3.5%)(Actual trading results this trade = -3.2%; Actual trading results for 2020 = -0.7%)